Renovations even hotter than Sales
Renovations even hotter than sales
Even Canadians who didn't buy a new
home in the past few years probably know
this country is immersed in an
unprecedented housing boom. But there's
another market growing at a pace so
furious, it may even dwarf new-home
buying. In a word: renovations.
Whether it's putting a Jacuzzi in the
backyard or spending $500,000 to rip
apart an entire house, Canadians are
spending like never before on facelifts for
their homes -- to the tune of $38-billion
last year.
And that number is only expected to rise.
A report by Clayton Research suggests
renovation spending in Canada will hit
$40.7-billion this year and $43.5-billion in
2006. And the market is expected to grow
by 7.2% a year, twice the rate of the
Canadian economy as a whole.
Another study, by Ipsos-Reid, found as
many as two-thirds of Canadian
homeowners say they will likely overhaul
their homestead this year.
That isn't news to the staff at Calgary's
building permit department, who have
seen the reno trend move in lockstep with
soaring housing prices and one of the
country's hottest job markets.
Canada's oil capital happens to be in a
province expected to boast the fastestgrowing
renovation market in the country
next year. "There's an extensive amount
of work being done in this city," says Gary
Klassen, director of Calgary's development
and building approvals department. "In the last three to five years, the numbers have
just kept rising. We're approaching one million in population, and it's a really strong
employment centre, too."
Peter Brieger
Financial Post
CREDIT: Dollhouse Courtesy of Little
Dollhouse Company, Toronto,
www.thelittledollhousecompany.com. Photo:
Brent Foster, National Post
A dollhouse.
CREDIT: Jason Payne, CanWest News
Service
About 72% of Canadian homes are over 20
years old, and "many of those houses are in
need of repair," Rona's Sylvain Morissette
says.
Take a look at any residential street and start counting those big steel dumpsters
filled with dust, doors, plaster and carpeting. BFI Canada Income Fund does just that.
Though it won't release numbers, the waste management giant says it has seen a
spike in demand for monster trash receptacles.
If you're still not convinced, just ask Mark Jackson, a general contractor who heads up
Jackson & Associates Inc. in Toronto. "Right now, you could be the worst contractor in
the world and still get work," he says.
But why are Canadians redoing their homes in record numbers? "Cheap money," Mr.
Jackson says. "I think that's really it in a nutshell."
Those record low interest rates propelling new home sales are undoubtedly driving
the reno market too. But low borrowing costs are just one piece of the puzzle. The socalled
"cocooning" trend that grew out of Sept. 11 has many people rediscovering
living -- and entertaining -- at home.
Others want to hike the value of their house if they decide to sell. Still others weigh
the hassle and cost of buying a more expensive house, and opt to stay put instead --
inevitable disputes with contractors notwithstanding. After all, why move when you
can remake a home to suit your tastes, says lawyer Adrienne Rutherford, who
recently plunked $70,000 into her mid-town Toronto home. "I don't really want to buy
someone else's renovation," she says. "Prices for new homes are insane, and we
weren't going to be able to get a house that was close to the kids' school."
One of the biggest factors behind the renovation boom is the age of Canada's housing
stock. In many urban centres, the most sought-after properties are downtown, and
those homes are getting a little long in the tooth.
About 72% of Canadian homes are over 20 years old, according to Sylvain Morissette
at home improvement giant Rona Inc. "Many of those houses are in need of repair,"
he says. "They need to rebuild the roof, patio, bathrooms and windows."
Robert Macpherson, co-founder of Lieux Architects Ltd., says many neighbourhoods
are undergoing an "accidental preservation," one that sprouted out of a resurgence in
downtown living. "Almost all the most desirable neighbourhoods in Toronto have
houses that are 60 to 100 years old," he says. "But many of these people aren't living
downtown for the reasons you might see in a left-wing city councillor who bikes to
work. Most of them have two cars, and they've got money."
A big bank account comes in handy, since most home renos end up being pricier than
expected. The Ipsos-Reid poll found half the Canadians who expect to renovate this
year plan to spend less than $5,000. About one-quarter aren't sure how much they'll
shell out, and 28% expect to spend more than $5,000.
These days, the sky's the limit: Italian faucets, marble countertops, home theatres,
spa-style bathrooms and stainless steel refrigerators equipped with TV screens. Some
people spend upwards of $60,000 on a kitchen alone, and $500,000 renos aren't
uncommon.
More and more, homeowners are also willing to hire an architect who can take their
ideas -- often soaked up from design magazines -- and put that vision on paper, says
Mr. Macpherson.
Sandra Turley-Ewart, a Toronto IT professional, did just that before she and her
husband put down $150,000 to turn their 1957 house into an "ultra-modern" living
space styled as an open-concept New York pad. Materials were specially ordered, and
the couple won inspiration for their piece de resistance -- a conversation pit in the
refinished basement -- from 1964's The Pink Panther.
Carpeted bright orange, the sunken pit features a small glass table in the centre and
a wood-burning stove to keep guests warm during late-night chats. A sheepskin rug is
draped down the steps of the mini-amphitheatre. "The days of the white fridge are
over," Mr. Macpherson says. "We're finding people are much more open to things now
than we would have ever thought."
Conversation pits are rare, of course. Home theatres are not. In fact, they're the top
trend in home renovation, according to the Appraisal Institute of Canada, which
values residential and commercial properties. "How big a scale do you have?" says
James Marshall, director of custom installation at Toronto's Bay Bloor Radio, when
asked about demand for home theatres. "It's pretty alarming. Flat-screen TV sales
were up 450% last year."
For some people, home theatre rooms are a place to gather with family. Others just
want to flex their bursting wallet. "There's definitely the bling factor with some people
who want the cooler, bigger plasma TV than the neighbour," Mr. Marshall says.
"Designers will hate me for this, but a plasma is cheaper than buying that 16thcentury
French provincial armoire, and it looks nice on the wall."
Buying your very own Carnegie Hall, with top-quality sound in every room and an
entertainment refuge boasting "Cineplex-type" sound and video, can cost as much as
$40,000, Mr. Marshall says.
Elaine Khotek-Holmes, a 43-year-old Toronto financial planner, had Bay Bloor equip
her overhauled home with plasma screens and central sound -- all controlled by an
easy-to-use keypad.
Ms. Khotek-Holmes and her husband considered buying another home, but figured
they might do better enlarging their 1,500-square-foot house, picked up at a thrifty
price. And she has no plans to leave -- at least not for the time being.
That's a key question for aspiring renovators because expensive work may not show
up in a home's selling price, says Mike Garcelon, a Saskatchewan-based real estate
appraiser.
"People naturally assume if they put $10,000 into their home, they'll get $10,000
out," he says. "Unfortunately, that isn't always the case. There are thousands of
variables, including big ones like the home's location and health of the local
economy."
The Appraisal Institute's study found renovating bathrooms and kitchens or slapping
on a fresh coat of paint generate the best returns -- anywhere from 75% to 100% of
the cost. Building a deck, finishing the basement or installing a fireplace tend to give
renovators a lower bang for their buck. The worst updates on that scale include
landscaping, installing a skylight or breaking ground on a new pool, the report found.
Homeowners can also customize their abode too much, shrinking the number of
possible buyers, Mr. Garcelon says.
© National Post 2005
Even Canadians who didn't buy a new
home in the past few years probably know
this country is immersed in an
unprecedented housing boom. But there's
another market growing at a pace so
furious, it may even dwarf new-home
buying. In a word: renovations.
Whether it's putting a Jacuzzi in the
backyard or spending $500,000 to rip
apart an entire house, Canadians are
spending like never before on facelifts for
their homes -- to the tune of $38-billion
last year.
And that number is only expected to rise.
A report by Clayton Research suggests
renovation spending in Canada will hit
$40.7-billion this year and $43.5-billion in
2006. And the market is expected to grow
by 7.2% a year, twice the rate of the
Canadian economy as a whole.
Another study, by Ipsos-Reid, found as
many as two-thirds of Canadian
homeowners say they will likely overhaul
their homestead this year.
That isn't news to the staff at Calgary's
building permit department, who have
seen the reno trend move in lockstep with
soaring housing prices and one of the
country's hottest job markets.
Canada's oil capital happens to be in a
province expected to boast the fastestgrowing
renovation market in the country
next year. "There's an extensive amount
of work being done in this city," says Gary
Klassen, director of Calgary's development
and building approvals department. "In the last three to five years, the numbers have
just kept rising. We're approaching one million in population, and it's a really strong
employment centre, too."
Peter Brieger
Financial Post
CREDIT: Dollhouse Courtesy of Little
Dollhouse Company, Toronto,
www.thelittledollhousecompany.com. Photo:
Brent Foster, National Post
A dollhouse.
CREDIT: Jason Payne, CanWest News
Service
About 72% of Canadian homes are over 20
years old, and "many of those houses are in
need of repair," Rona's Sylvain Morissette
says.
Take a look at any residential street and start counting those big steel dumpsters
filled with dust, doors, plaster and carpeting. BFI Canada Income Fund does just that.
Though it won't release numbers, the waste management giant says it has seen a
spike in demand for monster trash receptacles.
If you're still not convinced, just ask Mark Jackson, a general contractor who heads up
Jackson & Associates Inc. in Toronto. "Right now, you could be the worst contractor in
the world and still get work," he says.
But why are Canadians redoing their homes in record numbers? "Cheap money," Mr.
Jackson says. "I think that's really it in a nutshell."
Those record low interest rates propelling new home sales are undoubtedly driving
the reno market too. But low borrowing costs are just one piece of the puzzle. The socalled
"cocooning" trend that grew out of Sept. 11 has many people rediscovering
living -- and entertaining -- at home.
Others want to hike the value of their house if they decide to sell. Still others weigh
the hassle and cost of buying a more expensive house, and opt to stay put instead --
inevitable disputes with contractors notwithstanding. After all, why move when you
can remake a home to suit your tastes, says lawyer Adrienne Rutherford, who
recently plunked $70,000 into her mid-town Toronto home. "I don't really want to buy
someone else's renovation," she says. "Prices for new homes are insane, and we
weren't going to be able to get a house that was close to the kids' school."
One of the biggest factors behind the renovation boom is the age of Canada's housing
stock. In many urban centres, the most sought-after properties are downtown, and
those homes are getting a little long in the tooth.
About 72% of Canadian homes are over 20 years old, according to Sylvain Morissette
at home improvement giant Rona Inc. "Many of those houses are in need of repair,"
he says. "They need to rebuild the roof, patio, bathrooms and windows."
Robert Macpherson, co-founder of Lieux Architects Ltd., says many neighbourhoods
are undergoing an "accidental preservation," one that sprouted out of a resurgence in
downtown living. "Almost all the most desirable neighbourhoods in Toronto have
houses that are 60 to 100 years old," he says. "But many of these people aren't living
downtown for the reasons you might see in a left-wing city councillor who bikes to
work. Most of them have two cars, and they've got money."
A big bank account comes in handy, since most home renos end up being pricier than
expected. The Ipsos-Reid poll found half the Canadians who expect to renovate this
year plan to spend less than $5,000. About one-quarter aren't sure how much they'll
shell out, and 28% expect to spend more than $5,000.
These days, the sky's the limit: Italian faucets, marble countertops, home theatres,
spa-style bathrooms and stainless steel refrigerators equipped with TV screens. Some
people spend upwards of $60,000 on a kitchen alone, and $500,000 renos aren't
uncommon.
More and more, homeowners are also willing to hire an architect who can take their
ideas -- often soaked up from design magazines -- and put that vision on paper, says
Mr. Macpherson.
Sandra Turley-Ewart, a Toronto IT professional, did just that before she and her
husband put down $150,000 to turn their 1957 house into an "ultra-modern" living
space styled as an open-concept New York pad. Materials were specially ordered, and
the couple won inspiration for their piece de resistance -- a conversation pit in the
refinished basement -- from 1964's The Pink Panther.
Carpeted bright orange, the sunken pit features a small glass table in the centre and
a wood-burning stove to keep guests warm during late-night chats. A sheepskin rug is
draped down the steps of the mini-amphitheatre. "The days of the white fridge are
over," Mr. Macpherson says. "We're finding people are much more open to things now
than we would have ever thought."
Conversation pits are rare, of course. Home theatres are not. In fact, they're the top
trend in home renovation, according to the Appraisal Institute of Canada, which
values residential and commercial properties. "How big a scale do you have?" says
James Marshall, director of custom installation at Toronto's Bay Bloor Radio, when
asked about demand for home theatres. "It's pretty alarming. Flat-screen TV sales
were up 450% last year."
For some people, home theatre rooms are a place to gather with family. Others just
want to flex their bursting wallet. "There's definitely the bling factor with some people
who want the cooler, bigger plasma TV than the neighbour," Mr. Marshall says.
"Designers will hate me for this, but a plasma is cheaper than buying that 16thcentury
French provincial armoire, and it looks nice on the wall."
Buying your very own Carnegie Hall, with top-quality sound in every room and an
entertainment refuge boasting "Cineplex-type" sound and video, can cost as much as
$40,000, Mr. Marshall says.
Elaine Khotek-Holmes, a 43-year-old Toronto financial planner, had Bay Bloor equip
her overhauled home with plasma screens and central sound -- all controlled by an
easy-to-use keypad.
Ms. Khotek-Holmes and her husband considered buying another home, but figured
they might do better enlarging their 1,500-square-foot house, picked up at a thrifty
price. And she has no plans to leave -- at least not for the time being.
That's a key question for aspiring renovators because expensive work may not show
up in a home's selling price, says Mike Garcelon, a Saskatchewan-based real estate
appraiser.
"People naturally assume if they put $10,000 into their home, they'll get $10,000
out," he says. "Unfortunately, that isn't always the case. There are thousands of
variables, including big ones like the home's location and health of the local
economy."
The Appraisal Institute's study found renovating bathrooms and kitchens or slapping
on a fresh coat of paint generate the best returns -- anywhere from 75% to 100% of
the cost. Building a deck, finishing the basement or installing a fireplace tend to give
renovators a lower bang for their buck. The worst updates on that scale include
landscaping, installing a skylight or breaking ground on a new pool, the report found.
Homeowners can also customize their abode too much, shrinking the number of
possible buyers, Mr. Garcelon says.
© National Post 2005
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