Thinking about renovating your property to make a tidy profit on the real estate market?
Think carefully. Not all home improvements deliver a solid return on investment. In fact, some home renovation projects can cost much more than they will ever deliver back.
So, before you begin your plans for property refurbishment or renovation, it’s worth considering the traps to avoid – and stay focused on what might be the most lucrative ways to genuinely add value to your investment property or home.
Renovating Your Kitchen
When it comes to property flipping for profit, updating the kitchen – or completely replacing the kitchen – is one of the most popular home renovations to undertake.
For a cost-effective, relatively smooth kitchen update solution, modular kitchens can transform a space and add new levels of convenience and liveability. Buying an off-the-shelf modular option can deliver great results but to add a unique touch, working with a custom kitchen builder can deliver even more stunning outcomes. Be warned, though – with the cost of a custom kitchen able to head well towards the $100,000 mark (and even beyond, depending on fittings and fixtures), it’s important to crunch your numbers first to ensure you set a budget limit that helps you stay within the range that sees you return a profit, rather than extra stress.
Beautiful Bathroom Renovations
Today’s homes have more bathrooms than those of yesteryear, with a spokesperson from the Housing Industry Association reporting that there are now, on average, 2.6 bathrooms per new home.
If renovating an existing bathroom, or adding a brand new bathroom, is on your renovation radar, be sure to have a clear budget planned right from the beginning of the project.
Discerning buyers and would-be tenants are fussy about clean bathrooms with modern, stylish fixtures and fittings but for the home-owner planning the refurbishment to attract a keen buyer, it’s easy to fall into the trap of over-capitalising and kissing any hope of profits goodbye.
Be stylish without being extravagant. Do your research on tapware and tiles to help you create a wonderful look without going all out on the premium options. Choose colours that create a spacious, sleek look that gives incoming home-owners a chance to add their own touches and budget every aspect of the bathroom renovation to ensure the project stays on track.
Repainting Makes a Big Difference
When it comes to smart renovations, focus on things that highlight your home’s best qualities, while still giving incoming owners the opportunity to make their own mark, should they wish to.
Painting is a relatively affordable way to give a home an instant face-lift and if you choose a colour palette that helps create a sense of fresh, airy space, you are on the right track to add value to your home. If you are skilled with a paintbrush, you can save a lot of money by tackling the project yourself but be sure to be realistic. Painting is time-consuming and needs to be done well. If you can’t commit to seeing the job through in a way that is professional and with incredible attention to detail it’s a false economy if using your painting skills (or lack of them!) means the job will detract from the quality of your home, rather than add to it.
Creating Friendly Outdoor Space
Outdoor living is something so many Australian families enjoy and it’s increasingly common to see the once-humble patio area take on the role of an additional outdoor room. A well-designed all-weather area that lets sunlight stream in, while offering protection from the nastier winter elements, is a wonderful way to add value to your home, but it’s still critical to keep a firm eye on your budget before going overboard on gas-plumbed barbecues, stone pizza ovens and outdoor catering kitchen facilities. Again, talking to your real estate agent about the type of buyer likely to be interested in your home can help guide your decision about whether investing money in renovating your outdoor space is the smart thing to do, before putting your house on the market. If your area is poised for development opportunities, no matter how much love you put into an outdoor entertaining area, you might find a new buyer may be more interested in building townhouses right where your outdoor conversation pit once was.
Think Before You Renovate
Generally speaking, renovation work that makes the kitchen and bathroom areas obviously better is always attractive to potential buyers, offering those would-be buyers the opportunity to move in and start living straight away. Whenever potential buyers feel a strong emotional connection to a property, they are more likely to want it – and that means more competition and higher bidding – so if you are keen to attract passionate buyers who will fall in love with your house, a well-planned kitchen renovation can be a wonderful way to invest some money prior to putting your house on the market.
Talk to your real estate agent first, though – depending on what’s happening in your local area, your home might be seen as a knock-down to re-build completely and develop and if that’s the case, even the fanciest kitchen will still be wasted time and money.
If you need advice on refinancing to renovate your property, talk to our mortgage broking specialists at Lending Specialists today.