Remodelling to add value to a property is very different from renovating for lifestyle. If it’s your ‘forever home’, you will gain emotional and physical comfort from your expenditure. But if you are remodelling to sell – to increase the value of your property – you need to think hard before committing.
Home owners who are considering selling often spend money ‘fixing up’ the wrong things. For example, repainting is generally an expense, not an investment. The reason is that buyers usually under-estimate the value of that new ‘paint job’. There’s also a risk that they will not like your colour scheme!
The same is usually true of floor coverings. You might love that new planked vinyl floor but will a prospective buyer? If they happen to be carpet lovers, you just wasted a lot of money.
So if you’re thinking of renovating your property before selling, there are a number of things to consider so that your investment is exactly that… an investment and not an expense!
Whether a renovation adds value will vary as every property is different. Knowing what adds or detracts from value is essential if you’re looking to make a profit in the competitive housing market.
So what are the three areas that will generally add real value and help to achieve a quick sale?
Even as families in many countries continue to get smaller, housing continues to get bigger! It seems that we all our love our ‘space’! This is especially true now that so many of us have discovered the benefits of working from home!
Creating extra floor space by extending the footprint of a property is by far the biggest drawcard for buyers to pay more. In some cities, the addition of an extra bedroom can add anywhere between $80-200k on top of the price.
If you have sufficient land to extend at ground level, this can be a relatively inexpensive exercise as it need not involve any new plumbing or drainage work.
If you land area is limited in size or by building covenants, consider going up. Again, assuming you do not need plumbing or drainage to the new area, you can potentially get a significant return on your investment.
Another area worthy of investigation is to create additional, off-street, parking. This is especially true in inner-city areas. It’s a simple feature that can add many thousands to your home’s value.
Kitchens and bathrooms
Kitchens and bathrooms are – by far – the most labour and materials intensive part of any home. Many prospective buyers looking at your home are ‘borrowing to the hilt’ and won’t have the financial capacity to retain funds to remodel kitchens and/or bathrooms.
But both buyers and lenders know the value of these big-ticket rooms. Your investment in these areas will directly and potentially, significantly increase the (mortgage lender’s) valuation of your property.
Also keep in mind that bathroom and kitchen renovations can be very disruptive. No-one enjoys having limited cooking or bathing facilities for weeks on end, so not having to plan and spend here is an area where renovators can really profit. As the renovator, you can stage or time the works to minimise inconvenience to you and your family.
If this pandemic has taught us one thing, it is that the ability to spend time outdoors is precious.
Here in Australia, we have a climate that allows us to relax and entertain outdoors for much of the year. Even in colder climates where winters can be harsh, there are typically five or six months of the year where outdoor living is very pleasant.
The bottom line is that having an attractive, usable and well-designed al fresco area or garden can be a real boon for value-adding.
If your home is in a younger family area, creating a safe, level area for children to play will add value.
And since humans are a visual animal, simply adding a beautiful garden oasis can add emotional value to a property. Screening from neighbours and generally improving the outlook from your home will also add value.
So there you have it! Three areas that will enhance your home’s appeal to potential purchasers. If your budget is tight, you’ll probably get the most ‘bang for buck’ from appropriate landscaping. As a bonus, you will be able to do most, if not all of the work yourself!
Ready to get started?