Renovation: The Most Important Facts on Remodeling and Refurbishing at a Glance

A new kitchen, the renovation and insulation of the exterior walls, or solar panels on the roof: Refurbishing and remodeling come in many forms. Find out what you need to consider when planning this type of work and what your financing options are.

Building is trendy. However, renovations are more common than new construction projects. According to the latest construction statistics for 2015, structural engineering investments grew by 1.7 percent within one year. At 3.1 percent, the increase in the number of renovations was significantly higher than the increase in new constructions (1.0 percent).

Renovation, Value Preservation, and Modernization

In addition to the low interest rates, there are other good reasons to invest in remodeling. One of the most important is age-related renovation. Many houses in Switzerland are around 100 years old. Here, value-maintaining measures are necessary.

Sometimes, however, the purpose of the modernization is to make the property more comfortable, regardless of its age. For instance, a new coat of paint, new tiles in the bathroom, or an entirely new kitchen. In addition, individual components of a house have to be regularly replaced. Wooden window frames, for example, last on average 25 to 35 years. A renovation might also be necessary because the family is growing. A loft conversion or ground-floor extension can provide more space.

Improving Energy Efficiency Pays Off

However, the building structure is not the only thing that must be maintained. Especially for older houses, renovations that improve energy efficiency are worthwhile. Not just for the sake of the environment, but also from a financial point of view. For example, new insulation can specifically help to conserve heating energy. You can also reduce heating costs by replacing the heating system – for instance, with a wood pellet system or a heat pump. Hot water can be generated with solar panels. Over the years, investments in energy efficiency pay off.

Energy-related refurbishments are also subsidized. Depending on the canton of residence, there are various incentive programs and subsidies available for increasing energy efficiency. It is advisable to look at the guidelines for incentives and subsidies early on and possibly factor them in at the planning stage, as in some cases it may be too late to request financial assistance once you have already started renovating.

Costs and Financing of the Renovation

Good planning is imperative, regardless of the reasons for the renovation. What and how, specifically, do you want to renovate? Do you need a specialist to coordinate the work? Is a building permit required? A number of factors need to be taken into account when planning your renovation.

After rough planning, it is important to clarify the financing. By now at the latest, it is worth getting in touch with the bank. It reviews the rough cost estimate and the current mortgage situation of the client. Depending on the property value, existing mortgage, and available equity capital, a cost ceiling is determined for the planned renovation.

Even before you reach the detailed planning stage, we recommend that you work out the specific financing solution with the bank. In doing so, the future market value of the house or apartment will be calculated, among other things. If there are discrepancies in project planning, you can still adjust them at this stage. A sustainable financing model is an essential part of your planning. After all, you want to be able to enjoy your new kitchen or solar installation on the roof for many years to come, without having to worry about financial difficulties.

Are You Planning to Renovate or Upgrade Your Home?

You will find more information on financing, mortgage and affordability here.