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Maintaining a home

How renovating can boost your home’s worth

26 April 2019

Thinking of renovating your home? Taking on a renovation can seem like an endless and overwhelming task – no matter if it’s small scale improvements or large recons. On top of that, some projects can end up costing more than they’ll ever give back, rather than adding resale value.

Hopefully you’re more interested in achieving the latter, and completing renovations that can potentially add value to your home. If that’s the case, read on – we’ve got some tips for you!

Boosting the value of your home through renovations

Renovate with your market in mind

It’s almost impossible to increase the value of your home if it doesn’t appeal to a mass audience. You might like that off-mustard feature wall in the bathroom, but does your target market?

If you can aim to renovate with your market in mind, there’s more likely to be a bidding war for your house when it comes time to sell. It can be worthwhile to chat to a local real estate agent about who’s interested in the area, and may able to give you advice on what potential buyers are looking for.

For example, if your main demographic is families with young kids, a real estate agent might advise against creating a paved deck space. Instead, you may want to utilise that backyard with grass and plenty of space to play.

Remember; if you can give the buyers what they want, they’ll be more likely to pay a premium for it.

Start small and work your way up

Ever heard of the saying ‘it’s the little things that add up’? If you concentrate all your efforts on the big project, you’re more likely to neglect all the other, smaller tasks. So start small –  by getting your paint brush out and giving the walls a coat of paint to breathe new life into a room. Choosing a fresh coat, like neutral grey and beige, can appeal to the largest amount of people possible. It’s also amazing what fresh paint can do to a space in livening it up.

Focus on what’s seen, not what’s unseen

OK, so we don’t necessarily mean to sweep the dust under the rug and adopt an “out of sight, out of mind” approach to your renovation. What we’re trying to say is that a smart renovation pulls the right emotional strings with potential tenants or buyers, which can impact the value of a property significantly. And usually, that’s achieved more through aesthetics rather than the inner workings that are hidden away.  

Consider questions like, what does it look like from the street? Does the entryway ‘wow’ when people enter? Quick wins for creating a good first impression include:

  • Replacing the front door – a new door or a new coat of paint can give the impression of new start for a prospective buyer
  • Painting the letter box (or fixing its wayward tilt) to add street appeal
  • Replacing any overhead lights and polishing the house number

Don’t go overboard on the big projects

It goes against logic, but sometimes it’s wise to avoid high-end upgrades that are beyond the level of the rest of the house. Doing this can even adversely impact the resale value. For example, say you need to update bathroom taps. Finding incredibly fancy fittings might seem tempting, but it can make the remaining, un-updated basin seem extra old and rundown in comparison.  

With that being said, big projects can sometimes add the most value to your home - if you do the right ones. For example, adding another bedroom or re-doing the entire bathroom can be (relatively) quick and cost-effective wins.

You may want to think about how you can maximise the space of the house. If you have an old dusty attic, it’s worth taking the time to clean it out, spruce it up, and maybe even converting it into a useful space, like a parent’s retreat. If you’re game and have some extra space within your property lines, knocking down a portion of the house and creating an extension can also add tremendous value to your home. Of course, it’s important to check with the local authorities and building requirements before undertaking a renovation of this magnitude.

Renovations to avoid

Not all renovations are instant improvements. Some of them should simply be avoided (or won’t provide a big return, so should be carefully considered if your main aim is boosting resale value). These include:

  • Swimming pools – an average concrete swimming pool costs $50,000*, with fibreglass pools usually costing up to $25,000, plus installation costs which can be between $25,000 and $75,000. Not to mention, Australians spend an average of $1000-$1400 on pool maintenance every year, an additional cost that may ward off potential buyers
  • Hidden renovations – things like insulation, double glazing, and air conditioning systems may improve the comfort levels of tenants living in a home, but they won’t necessarily immediately add obvious worth to your property’s value
  • Extravagant kitchens and bathrooms – although kitchens and bathrooms are important, they can be a black hole for throwing endless cash in, and you may not get back how much it adds to the overall worth of your home
  • Complex gardens - potential buyers/tenants can be put off by the work they’ll have to take on. Plus, getting an expert in to design your garden can be quite expensive – between $2000 and $5000 for a full service.

Renovations can do wonders for a home’s value – when done right. With a little bit of know-how and a good plan for tackling the necessities, you can spend less time worrying about the renovation and more time getting ready for the goodbye (if you’re selling, of course!).

 

Learn About Personal Loans for Renovations

 

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Information is intended to be of a general nature only and any advice has been prepared without taking into account any person's particular objectives, financial situation or needs. You should make your own enquiries, consider whether advice is appropriate for you and read the relevant Product Disclosure Statement or Product Information Document before making any decisions about whether to acquire a product

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