Renovate or relocate?
For homeowners caught between staying put or starting fresh, the decision to renovate or relocate is more than just a personal preference; it is a question of smart investment.
According to property experts at RE/MAX Southern Africa, the answer lies in understanding where the better return on investment (ROI) lies and which option holds the most potential for future house price appreciation.
“The choice between renovating and relocating hinges on a homeowner’s financial goals, the state of their current property, and market conditions in both the current and potential new neighbourhoods,” says Adrian Goslett, regional director and CEO of RE/MAX of Southern Africa.
For example, he explains that in an area with slow house price appreciation, selling and upgrading could yield a better outcome than investing further in a stagnant area. Conversely, in high-demand suburbs with limited stock, upgrading your current home might be the best way to ride the property value wave.
Another aspect to consider when weighing up whether to renovate or relocate is the transactional costs of buying a home, such as transfer duties, legal fees and commissions. These can typically total around 7–10% of the purchase price.
“These costs can offset short-term gains unless you are upgrading to a home with stronger upward value potential,” Goslett cautions.
Strategic move
On the other hand, home renovations can be a strategic move, especially in areas with stable or rising property values. Updates to kitchens, bathrooms and open-plan living spaces can significantly increase the appeal and value of a home. However, Goslett warns that the key is not to overcapitalise.
“Spending more than what the neighbourhood can support in resale value may mean losses down the line. Homeowners should also consider the cost of temporary accommodation during extensive renovations, and the unpredictability of construction timelines, which may erode ROI if not carefully managed,” he notes.
Beyond financial returns, homeowners must also consider how well their current property supports their day-to-day life, and whether they could afford to buy a new home if they want to remain in the same suburb, perhaps because of schooling, work commutes or family considerations.
When a home’s footprint simply cannot accommodate the household’s evolving needs, Goslett says relocating may be the more practical and cost-effective solution. Similarly, if homeowners must remain in the same area, renovating may be the better option.
When it comes to making this decision, homeowners are advised to speak to a professional real estate agent before making a final call.
“A Comparative Market Analysis (CMA) can give insight into your home’s current value, while a property investment consultation can identify suburbs with promising growth. Our agents can then guide you towards the most financially sound decision - whether it is breaking ground or packing boxes,” says Goslett.
