Should I Delay Home Renovations Due to the COVID-19 Crisis?

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Life as we know it has changed.  COVID-19 has arrived on our idyllic shores stopping us in our tracks, turning our lives upside down and putting our economy at risk of diving into a deep recession.

As all New Zealanders face the potential outcomes of this viral pandemic, many homeowners may be wondering whether it’s still a good idea to continue with their home renovation plans.

The answer?

Is not a simple one and it ‘depends’…


What Are Your Renovation Plans And How Are You Funding Them?

Some renovations are more expensive than others.  Lower cost projects, that will make your home more livable without draining your ‘rainy day’ savings, perhaps don’t need to be put off.

That kitchen or bathroom upgrade or new larger deck might be just the improvement you need, especially if you’re going to be spending more of your time at home in the coming months.

If you’ve been considering a larger renovation project and funding it through a home loan, then the decision could be a bit more complex.  It’s certainly too soon to tell how badly the COVID-19 pandemic will hurt the economy - how this crisis might affect job security and funding from the banks in the longer term.

That said though, when the Reserve Bank dropped the OCR to just 0.25%, banks did the right thing and passed the full 0.75% reduction to their floating rates.  As a result, home loan interest rates have never been lower, with indications from financial commentators that they’re as low they will go and are likely to stay that way for the foreseeable future.

Renovating your home, your biggest asset, usually means increasing its value, making the long-term return on investment worth the trouble and initial expense.  Homeowners with good equity in their homes, and particularly those planning to stay put for the longer term, might want to seize the current opportunity – now could be a great time to take advantage of the low mortgage rates and press ahead with your plans.


What Stage Are You At On Your Renovation Journey?

There will be homeowners across the country who were already underway with their renovations when the Level 4 lockdown was announced.

Construction may have already started when progress on site came to a complete standstill.  We know that for sure – we had projects at varying stages of the build and we truly sympathise with homeowners in that situation.

Those renovations will continue regardless.  The homeowners, the banks and the builders are already committed to the project and will be keen to get back to see the renovation works completed.


Thinking About Starting Your Renovation In the Near Future

Perhaps you’re right at the other end of the renovation journey – you’ve been thinking about renovating your home and about to engage someone to help you with the design phase of your project.  Should you continue?

The initial concept design phase of a renovation project takes four to six months on average.  That should be plenty of time to get a better understanding of the longer-term impacts of the COVID-19 situation.  Perhaps we’ll even be out the other side with the economy well on the way to recovery.

So, while you’re in your ‘bubble’, you’ll have extra time to observe how your house is working, what the shortcomings are and ponder what you really need to enjoy your home.

Take the opportunity of some downtime and start the conversation with your bank or lender.  It’s always beneficial to understand how much you can afford to borrow in this important phase.

At the end of the day, the biggest investment required to develop your renovation concept design is your time – and that’s what many of us have plenty of right now.

Signing up to start concept plans is just that – it’s not a commitment to do the actual build - so if your circumstances change in the meantime, there is no need to go any further.  You’ll have a great vision of what the possibilities are for your home.

So just relax and enjoy the design phase!


Middle Of Planning Your Renovation

The good news is that designers and the Auckland Council planners are still working (from their homes), so there is every chance your renovation plans and/or building consent application will continue to progress during this time.

  • Concept Design In Development

You have already made your initial investment in your renovation plans.  Our advice is to use your spare time now to ensure your plans include everything you are expecting.  Check, check and re-check your plans.  Take a good detailed look at every nook and cranny drawn in your plans.  Changes at the consenting stage or even during the build could be very costly.

  • Ready to Move to Building Consent Drawings

Perhaps you are happy with your concept or sketch plans and you’re ready to move onto the next design phase – the development of the detailed building consent drawings.  At this point you’ll be required to make a further investment.

Provided finances allow, we suggest you continue as planned.  After all it could take in excess of five to eight weeks for the designer to draw up a comprehensive set of plans.  Just be warned, if specialists such as geo-tech or land surveyors need to be involved, you could hit delays if they are required to visit the property and we are not at an Alert Level that allows that. Maybe it would be prudent to first check with your designer which specialists will be required before committing to this stage.

  • About to Submit for Building Consent

If you are about to submit your plans into the council, you may naturally want to push the pause button.  But we suggest this may not be necessary.

A building consent is likely to take many weeks, if not months, to be issued and it certainly won’t expire overnight.  You have twelve months to start construction, and if necessary, you can extend the consent for a further twelve months for only $150*.

With any luck we’ll have this COVID-19 virus well and truly kicked into touch by then and you’ll have all the fundamentals in place and ready to start your project whenever it’s opportune for you.

  • Plans Are In The Council

For those waiting on their building consent to be issued, you have nothing to lose.

If you haven’t done so already, use your spare time to consider your fixtures and fittings – your kitchen appliances, your lights, your plumbing fittings, even your door handles.

While you might not be able to get to supplier’s stores right now, many of them have comprehensive websites with all their products detailed. Develop a shortlist to touch and feel once we are able to visit shops again – and who knows, there might be some good deals to be had once the doors open again!


Quoting Stage

You’ve already spent months planning your renovation.  The building consent has been issued, the funds are approved and your builder has given you a quote – you’re almost ready to start construction.

There are both pros and cons about this situation.  You have invested a lot of time and money to get to this stage, so you need to carefully consider your next move.


On the positive side, other homeowners may get cold feet and pull out of their projects, freeing up capacity of subcontractors and suppliers in the short term.  It’s possible your build schedule could be accelerated.

Meantime, you’re also in a great position to take advantage of the all-time record low interest rates.  Get your construction completed and lock those great rates in.

You are also one of the lucky ones and already have some clarity around your build costs.  The prices of many building products and materials may go up in the coming months if local manufacturing or imports into the country are held up.  It could therefore be wise to sign your builder up now and get key product ordered.

On the other hand, if you push ahead with construction, there may be disruptions to the usual supply chain causing delays and a drawn-out build schedule.  It is still not clear if the building industry will be affected by COVID-19 restrictions on business operations and whether the Level 4 lockdown is going to have any lasting effects. Simply put, no one knows.

Additionally, if there were to be another lockdown or a COVID-19 related issue on site, you would have to be prepared that your project would likely come to a halt.  Whilst a start-and-stop would be inconvenient, a well-organized and efficient building company should be able to re-schedule your project with some priority and get progress happening again quickly.


Everything considered, if all this uncertainty is of concern to you, we suggest revisiting the scope of your renovation project.  Most (good) builders will be sympathetic to the situation – after all, we’re all in this together.  They will want to work with you to find a win-win situation.

That may mean focusing on the priorities of the renovation project while leaving the ‘wants’ for another day.  Review the materials and finishes selected – perhaps there are cheaper alternatives that could be used that will not affect the quality of the final outcome.


A Partnership Approach

At MyHome Renovations our philosophy is to reduce the risk and uncertainty for Auckland homeowners looking to renovate.  Unfortunately, in these exceptional times, it’s very difficult for anyone to predict what the next few weeks, even months, will look like.

Whatever happens though, homeowners deserve to have a true partner in their renovation project.  They should feel informed about their options and empowered to make the best decisions for themselves and their home renovations.



Still confused?  Contact Us at MyHome Renovations to discuss your situation and possible options for you.



*Auckland Council fees as at 13 April 2020

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