Renovating is one of the best ways for property owners to increase the value of their homes. If you’re looking to add value to your home, but don’t want to renovate every room, it can be difficult to decide where to start.
Here are some ideas to help you decide which part of your property to focus on for the best results.
One of the quickest and easiest ways to give your home a new look and coordinated interior or exterior is a fresh coat of paint. Painting can be relatively inexpensive, whether you decide to do it yourself or hire professionals.
The kitchen is widely regarded as the best place to start when renovating – and while it can be a lot of work, the rewards can be substantial. Despite being one of the most expensive rooms in the house to renovate, there’s no need to break the bank.
An updated kitchen can make a huge impact on potential buyers, by giving your home a ‘ready to move in’ feel. The Housing Industry Association of Australia report that the average cost of a kitchen renovation (PDF 3.1MB) in Australia is $21,862, but the difference a modern kitchen makes when you’re selling can be substantial.
As far as appliances go, you might choose to purchase a single-brand suite to give a cohesive look and feel to the room. However, there’s often no need to go ‘top of the line’ when it comes to elements such as ovens. Adding value is about keeping costs to a minimum while refreshing the room.
If you’re not looking to make structural changes or spend a lot of money, you can consider some of these other quick ways to spruce up your kitchen:
- Clean or if needed replace grout and silicone to tiles and sink areas
- Polish stainless steel sinks with recommended cleaners
- Replace taps and mixers
- Replace handles on cupboards and make sure doors are level
- Polish floorboards, or if this is too big a task then you can revive them with regular application of O’Cedar revive wood polish and a warm mop.
Next on the list is the bathroom, a key element in any house – especially if the structure isn’t particularly modern. Similar to kitchens, an updated bathroom can provide a home with a much-needed contemporary boost, and it doesn’t have to cost the earth.
There are a number of cost factors to consider when renovating a bathroom that don’t apply to other rooms in the house, such as plumbing and waterproofing. Moving the location of sinks, toilets and showers can add a lot to the overall cost and this money probably won’t result in a lot of value being added in the long run.
Therefore, a key tip for doing up a bathroom: don’t overcapitalise.
It’s important to consider your home as a whole and the features you believe will be desirable for your location and target buyers. If you’re hoping to attract a family, for example, consider installing a bath.
Pay close attention to cracked tiles, worn or mouldy seals and leaking taps. Like kitchens, bathrooms should also be stylish, modern and functional (and above all, clean!). Replacing broken towel racks or dripping shower heads can make a big difference, while new mirrors and lighting can be a great finishing touch to make your bathroom feel more spacious.
Another area ripe for high-impact renovation is gardens and back yards. Opening up the rear of your home to create an outdoor entertainment area is effectively the same as adding a whole new room.
If your home already has an outdoor entertaining area, it’s worth considering whether there are elements that could be updated. Adding an outdoor kitchen or designated barbecue area can have a positive impact on the value of the property.
Also, first impressions count so don’t overlook the front yard. ‘Curb appeal’ can be the difference between potential buyers driving by or stopping to take a look inside. After all, the exterior is usually the first photo people see when they are looking at internet and newspaper advertisements.
Three things to consider before renovating
1. Avoid overcapitalising
The cost of renovations normally adds at least equivalent value to a property and lenders can take this into consideration when establishing finance. However, be conscious to avoid over capitalising as valuers will have a limit on the maximum amount they will attribute to the renovations. For example, granite bench tops and porcelain tiles could be a great investment for an executive residence, but for a modest rental unit may not be appropriate.
2. Weigh up your return on investment
Will the cost of the renovations have a benefit in either significantly increased rental returns, ease of renting the property, or potential resale value? This of course becomes less of an issue if the renovations are for your long term residence, but should still be considered as your situation could change.
3. Budget for unforeseen circumstances
While you may make your best efforts to ascertain costs associated with your renovations, its often a case that plans may change mid project, especially if structural issues are discovered along the way. Lenders recommend that you allow at least 10% of the project cost for these contingencies.
There’s more to adding value than giving your property a quick lick of paint and hoping for the best. The right renovation, in the right area of the house has the potential to add tens of thousands to the value of your home – and choosing the right way to invest your time and money could mean a better result when you decide to sell!
All the best,
You have just read a sample chapter from my Free Homebuyers Guide
Topics in the series include:
- Are you ready? Rent vs buy
- The First Home Owners Grant and other assistance
- Improve your chances of getting a loan
- Saving your deposit and budgeting
- What can you borrow… or what SHOULD you borrow?
- Count your costs – Buying a property
- Finding your property
- Buying your property
- Types of finance and accounts
- Loan application process
- How to repay your home loan early
- More about buying ‘off the plan’
- Adding value through renovations
- More about building
- More about auctions
- Alternative ways to find property
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