The problem many homeowners face when their home starts to feel a little cramped is whether it is better to renovate or sell. There are a number of things to consider before you make your decision including:
Your neighbourhood has played a key role in your life for the past few years. When you decide to move you might not be able to afford a home in your current area. This can be especially troublesome if you have kids as well as for your commute to and from work. When you decide to renovate you have the option of creating a perfect custom home in the perfect location without the need to uproot your family.
You also have to consider expenses. You want to know how much money would be available to you for renovations and compare that to the ideal renos you would need to make it worth your while to stay. You then have to look at what your budget would get you if you were to purchase a new home. Weigh the differences and decide which works more in your favour in hand with your wants and needs. Many homeowners have plenty of equity in their home. This means you can get a loan that is simply added back onto your mortgage. This is both an affordable and logical option as it does not add an additional financial burden to monthly expenses.
Make a list of all of the things you would do to create a custom home if you were to stay. List each item such as an additional bathroom, the need for a basement reno, a new kitchen, a mud room, a better backyard, etc. Each change will have an impact on the cost as well as the improvement to your comfort. Ask for quotes from a few contractors and see if the numbers match up to the amount of money you have available to invest in the renos.
If you feel your current house has the homey feel you desire in a neighbourhood you love, making a move is not the answer. Speak to a contractor and share everything you love about your home and everything you hate. Speak to your bank and then begin the renovations to create a custom home you will live in comfortably for years to come.