Deciding to renovate your home or investment property is an exciting period. We all of course have the intention to make our properties more attractive, comfortable and valuable. Unfortunately, that final goal is the one many budding renovators tend to struggle with.
The right renovation can help you achieve all three goals, transforming a drab and outdated house into a cash flow positive property, or simply ensuring your family home has a better chance of selling for more than your purchased it for and then some.
What you need to keep in mind before being your renovation is that there is a fine line between investing money to make your property more desirable and over-capitalising on your renovations; and the one point I find as an expert in the field is, you are almost guaranteed to set yourself up for failure if you don’t forward plan and really consider the space.
Now, if your plans are to make your home your “family home” and you’ll be living in it for the next 20+ years, it’s definitely worth going to extra mile to create a space you’ll absolutely love. But, if you’re not in that category, here’s what you need to know.
Start with a valuation. Contact a local realtor or a professional property valuer to determine what your home is worth in its current state.
Once you have your valuation, you want to consider your neighbourhood and this is something your realtor can help you with. Generally speaking, all suburbs (or even streets) have a ceiling value and this, as expected, varies significantly between luxury and starter homes.
Now, you have your valuation and your likely future value so you can create a budget. When compiling your budget there are two main figures to keep in mind for a full house overhaul. If you are planning on cosmetic upgrades you should invest no more than 15% of your home’s current value, and for structural or major renovations aim to invest no more than 45%.
Finally, you want to make your renovation strategic to ensure any changes you do make, makes the most out of the available space, so it’s a good idea to enlist the help of a designer. For help with your project contact us.