Financing for remodelling or renovations
Anyone who renovates, refurbishes or remodels a house will quickly find himself digging deep into his pockets. Therefore it's important not only to address the question of financing but also consider the tax implications.
by Gabi Hophan
1. Sustainable construction
Homes and other buildings are large consumers of energy and are responsible for a large portion of all CO2 emissions. Therefore communities, the cantons, the federal government and even banks promote sustainable construction, remodelling, renovations and refurbishments.
Get informed, and only then start thinking about your remodelling or renovation project.
2. Plan carefully and thoroughly
Plan out your project carefully, thoroughly and without haste. Bring in the necessary experts and, following these preliminary discussions, consider which modifications you would like and which are worthwhile. If necessary, divide up the work into two categories - that which is urgently needed and that which could also be carried out later. Then go out and get the corresponding bids.
3. Take into account tax implications
Some renovation or remodelling expenses have an impact on your taxes while some do not. It pays off to study this issue and consider the implications in your planning.
4. Set up financing
The best approach is to identify your own financial means and options for the construction project and discuss all these aspects with your bank in good time.
Consider whether or not to use funds from your Pillar 3a private pension fund or, in case it's necessary to apply for an increase in the amount of your mortgage, whether a Minergie mortgage is worth looking at. With energy-efficient construction perhaps you can even hope for some subsidies.