Renovating in a time of high inflation
If you’ve been thinking about renovating your home and are wondering what to do when inflation remains high and a mild recession is in the cards, you are not alone.
It’s important to keep in mind that the low interest rates and soaring housing market of the recent past were an anomaly. The days of securing million-dollar renovation loans are over.
Today, it’s less about expansion and more about reconfiguring your existing space to make it work better for you and your family. COVID-19 is still active and hybrid working is the new normal for many of us. We spend a lot of our time in our homes and want them to be functional, healthy and beautiful.
My advice is to do what we’ve always done. Renovate in stages. It’s easier to secure financing and can be quite transformational.
For example, a main floor gut renovation encompasses a third of a two-story home. It typically includes a kitchen, could include an additional bathroom, and offers an opportunity to open the space and improve functionality of a very busy area. Also, opening the front door to a renovated space can be gratifying.
If you are looking to add space, another option is to renovate the unfinished basement. The cost of doing so is comparable to renovating the main floor, but it’s a sound investment that will improve your home’s resale value and/or add additional income if it becomes a legal rental unit.
Often basements are viewed negatively. However, I’ve had clients wowed by their renovated basements. Underpinning – or lowering the floor – can add comfortable headspace. You can also allow for natural light to add more warmth to a beautiful renovation, making a basement feel not like a basement. As an added bonus, basement renovations require waterproofing and sump pump upgrades, which defend your home against flooding, something we’re seeing more of due to the changing climate.
Speaking of climate change, many of my clients are asking how to reduce their home’s carbon footprint. A full home energy retrofit is not something you do if you’re expecting short-term payback. However, including energy efficiency upgrades in smaller renovations makes sense, especially if you are gutting part of your house and can install high efficiency wall assemblies.
Many of our clients ask us to install heat pump-based systems to replace traditional gas-fired furnaces to avoid the use of fossil fuels. This new and rapidly developing technology allows you to re-use your existing heating ducts while also providing summer cooling.
One reason why heat pumps and the like are so popular is because of the Canadian government’s Greener Homes grant, which incentivizes home energy retrofits with grants. Also, the City of Toronto’s Home Energy Loan program offers low interest loans of up to $125,000 to cover the cost of home energy improvements. For a list of public and private rebate programs visit betterhomesto.ca.
Finally, I can’t overstate the importance of working with a trusted contractor, particularly one that integrates design and build, to help you get the best bang for your buck and a renovation you love.
Chris Phillips, Greening Homes’ founder and President, is an expert contributor of Neighbours of High Park Magazine. This article appeared in the March 2023 issue.