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Published by Contour Mortgage on June 19 2024

Renovate or Relocate: A Comprehensive Guide to Making the Right Decision

Choosing between renovating your current home or relocating to a new one can be difficult, involving a maze of financial, emotional, and market considerations.

To assist in navigating this challenge, we've crafted a comprehensive guide that weighs the pros and cons of each option. It's designed to provide clarity and direction, helping you assess whether the hassle of moving beats staying put and making your old home fit your new dreams. 

Balancing Home & Future Plans 

While entering your kitchen may feel like time travel to the dark ages, or your living space seems to shrink with each passing day, it’s important to balance short-term considerations with longer-term goals. 

Remember to consider the situation holistically, taking into account personal and family requirements, future plans, and lifestyle preferences. For instance, will you cover your children’s college expenses in the coming years? Or maybe you’re moving to a fixed income, or starting a business? Both renovation and relocation can be costly and disruptive, so it may be prudent to postpone the decision for a while or revisit your home’s existing capacity to meet your changing needs.

However, once you've decided to pursue either renovation or relocation, it’s time to start planning. The following sections detail the pros and cons of each, along with important considerations to guide you through the decision-making process.

renovation vs relocation infographic


A renovation project enables you to transform your living space to your exact specifications, eliminating the less attractive features while keeping those you treasure. If you love your ample backyard or proximity to the airport but need space for a home office, renovation may be just the ticket. 

Here are some of the key pros, cons, and considerations to contemplate:

Renovation Pros 


Customization is one of the greatest benefits of renovating your existing home. If you want that open-plan kitchen with custom cabinetry, specialty lighting, and an island-based beverage station, you might do better to remodel your existing kitchen. Finding the perfect kitchen in a new house may mean compromising on other home features.

Staying Put

Renovating also means avoiding the new home search and general upheaval of moving. Several markets across the U.S. are in short housing supply, driving prices and competition up. Would a move include new schools for the kids? A longer commute? Leaving neighbors and friends? The emotional toll of relocating can be deep and protracted. 

Cost Efficiency 

In many cases, renovating can be more cost-effective than relocating, especially considering the upfront costs of buying a new property, moving, and adapting to a new environment. You can stage renovations according to your budget and timeline to spread expenses in more manageable tranches.

Increasing Home Value

Renovation projects can often increase your home’s market value. Kitchen and bathroom remodels often yield high returns, with even minor updates potentially boosting home value by considerable margins. Energy-efficient upgrades appeal to eco-conscious buyers.

By updating outdated features, enhancing curb appeal, or adding modern amenities, homeowners can attract a broader range of buyers and command a higher selling price.

Flexible Loan Options

Even though renovation projects can be expensive, a wide range of loan options can help make your budget go further. These include a home equity loan, home equity line of credit, and cash-out refinancing. 

Government-backed renovation loans designed for borrowers requiring more financial assistance are also available. These include loans from the U.S. Department of Housing and Urban Development, the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, the U.S. Department of Veterans Affairs, and others.

Renovation Cons 

Living at a Construction Site 

Living in a home undergoing a remodel can be trying, as daily routines are upended and spaces are temporarily unavailable. Noise and debris can make the situation worse, testing even the most patient and flexible of homeowners.

Project Delays 

Despite the best of intentions, project slowdowns often seem inevitable. Common culprits include supply chain issues, labor shortages, poor weather, securing permits, and change orders. The list can go on and on. 


When undergoing a renovation, it’s essential to have a reasonable estimate of the marginal increase in value expected from the project. Overcapitalization occurs when the project cost exceeds its incremental gain. 

For example, a homeowner upgrades to a high-end gourmet kitchen costing $200,000. In a market of comparable properties selling for $300,000, the homeowner can sell their house at a premium price of $350,000. The house is considered overcapitalized because the improvement costs ($200,000) exceed the marginal value ($50,000) it provides. 

In short, the local market can’t support the high-end renovation, and the homeowner can’t recoup their full $200,000 cost. 


Relocating to a new place can mean finding a home that better suits your needs and preferences, providing a fresh canvas for creating your ideal living space. 

Here are some of the key pros and cons to consider when selling your house and buying a new place to call home.

Relocation Pros

Opportunity for a Fresh Start

Relocating to a different property enables you to start over with a new environment rather than work around the constraints of your current home’s layout or design.

For example, renovating an existing home with structural limitations or insufficient space can be challenging, time consuming, and pricey. In fact, a home addition is considered one of the most expensive home remodeling projects a homeowner can make. In many cases, moving to a larger house may be simpler, more convenient, and less costly. 

A new location may also come with better schools, new job opportunities, more attractive communities, and improved amenities.

No Renovation Project Headaches

From budget overruns to construction delays, clutter, and debris, undergoing a renovation project can be a logistical nightmare. Even if you’ve hired a general contractor, you may spend more time on project management than you bargained for. 

Relocating avoids the stress of navigating construction challenges and hiccups, enabling homeowners to focus on finding new living spaces without sacrificing their existing ones.

Cashing Out

If the real estate market is favorable and you have substantial home equity, selling your home might offer a lucrative opportunity. In such cases, leveraging your equity through a sale may be preferable to investing time and money into renovations, especially if the potential return on investment is uncertain. Remember to consider all costs associated with selling your current home and purchasing a new one in your analysis.

Flexible Financing Options

Should you need to finance a home purchase, there are many options available to most borrowers. From traditional 30-year fixed-rate loans to ARMs (adjustable-rate mortgages), government-backed mortgage programs, VA loans, and non-QMs (Non-Qualified Mortgages), there's likely a loan program available that caters to your unique needs and circumstances.

Relocation Cons 

Potential for Disruptions to Family & Social Networks

If you’re relocating to a new community, the disruptions to family and social networks can be severe. Leaving the familiar surroundings of friends, schools, and jobs can cause stress for everyone involved.

Hassles of Selling a Home

While you may be excited about buying a new home, selling the existing one comes with challenges. It can be a complex and time-consuming process, often involving numerous steps, such as preparing the house for sale, dealing with inspections and appraisals, and navigating financial negotiations.

Uncertainty About a New Location & Community

While your new digs may be perfect, the new neighborhood may take some time to adjust. Establishing new connections takes time and effort, which can add to relocation challenges. 

Comparing Costs 

Costs and funding options will be important in determining whether to renovate your existing home or relocate to a new one. And while costs can vary widely in both cases, the overview below provides standard cost estimates to help with your decision.


Expected renovation expenses include construction, materials, and labor. Recent estimates of average project costs by room are provided below:


$10K - $50K


$9K - $20K


$10K -$15K

Living room

$5K - $10K

Attic or Basement

$12.3K - $33.3K


$3K - $15K

*Architectural Digest, 2023 


Moving is a large undertaking that involves numerous expenses, not just the cost of the new home. These can vary widely depending on the market price and your down payment.

Relocating can cost you anywhere from $1K to as much as $12K or more, depending on how far afield you’re moving, the number of household items moved, and whether you employ professional movers or do it yourself.

Additional Costs

Whether renovating or relocating, additional expenses can include temporary housing where necessary, increased property taxes and insurance, and unforeseen costs such as structural repairs and time away from work. 

Funding costs should also be considered and can vary depending on the type of financing selected. A general rule of thumb is to factor in closing costs of 2 percent to 5 percent of the total loan or line of credit amount.

The Takeaway

Regardless of where you land on the renovation versus relocation debate, Contour Mortgage stands ready to assist. We understand the complexities and considerations involved in such decisions and offer tailored loan options to meet your unique needs.

At Contour Mortgage, we focus on customer service, ensuring our expert mortgage origination and operation teams seamlessly guide you through the process. With a wide range of residential home loan programs, including government-backed options, we provide the flexibility and support you need to achieve your dreams. Whether you're enhancing your existing space or starting fresh in a new one, Contour Mortgage is your trusted partner for navigating the path with confidence and peace of mind.

Contact Contour Mortgage to learn more about how we can help with your renovation or relocation financing requirements, qualifications, and questions.

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