New build V’s renovation – weighing up the pros and cons

Source: http://www.talktalk.co.uk/property/new-build-v-renovation.html

Property purchases fall into two camps; those that want a fully finished, sleek product and those that want a project – either to add value or fulfil a dream of creating a home. For those that fall into the ‘project’ camp there continue to be considerations, the biggest being – new build or renovation? The two approaches are radically different, both with their pros and cons – here we weigh them up, particularly with regard to the impact on money, aesthetic and schedule.

 

Cost

The first consideration to take account of is this: in the UK new builds are eligible for a VAT refund – which if you’re spending the average of £1,000 per square meter and are creating an average sized house of 76 square meters, equates to quite a massive refund – roughly £15,000. Renovations and extensions do not generally fall under this remit, however if you have bagged planning permission to convert a building into residential use you could be applicable. The reclaim is made at the point of completion, which means you still need to find the cash up front, but the refund comes at a good time to finance interior finish and fittings.

New builds are also easier to budget for – working from a blank canvas allows for pretty specific figures, whilst a renovation always encompasses a number of ‘unknowns’, which can prove costly and are impossible to accurately budget for. New builds can be designed around standard fittings i.e. doors, windows etc, where as the renovation of a 16^th Century cottage will demand bespoke measurements which can be more costly. Listed buildings also fall under tighter planning regulations that can greatly influence how a building is renovated and the resulting cost.

Financing for both renovations and new builds should also be a big consideration – houses without kitchens can often be hard to mortgage, whilst special mortgages for self-builds will need to be sourced, which may only release equity in stages rather than a lump sum.


Aesthetic and build

The common assumption when comparing new builds with renovations is to assume that the aesthetic cleanly falls to either clean modern or traditional character, respectively. But this doesn’t have to be the case – a new build, using traditional materials such as lime, granite, timber and stone can create a character feel with the added benefit of modern developments such as double glazing and super insulation; whilst a carefully planned renovation might inject steel and glass into an historic shell.

Older properties are not the most environmentally efficient option either and many ‘eco builds’ seem to be confined to the concept of a complete new build – whilst faster and potentially cheaper, this doesn’t have to be the only option. Retro fitting both insulation on interior and exterior walls, double glazed windows, floor and loft insulation can go a long way in improving the energy efficiency of a historic home, whilst a renovation is also less likely to require concrete foundations and slabs; the carbon footprint of concrete is huge and is estimated to currently account for 5% of all global emissions.


Schedule

The beauty of an old building is its unique character – the downside is that the character can often cost on both budget and schedule. The most revealing part of a renovation project is the dismantling that takes place at the beginning – revealing roof timbers, foundations – or lack of, and the overall structural stability of the building. It’s only at this point that a project manager can start to make a fair estimation on cost and timescales. It’s often the case that the resolution of one problem will reveal another four issues that need to be dealt with.

Similar to budgets, schedules on a new build are much easier to calculate and fairly accurate estimates can be made on each stage of the project, from the foundations up to the roof and render. Timber frames and pre-fab buildings are the popular choice for economy and schedule for new build, both of which offer incredibly quick solutions for time poor projects.

Sourcing materials and delivery deadlines are critical on both types of build – delays can be costly and result in trades wasting time on site. A seamless approach to project management would ideally see each stage of the project flow into the next.

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