Refinance and renovate your dream home on a budget

April 07, 2015
Ali Batten

Is it finally time to transform your house into your dream home? Renovations can be a costly exercise, and without proper planning it doesn’t take long before budgets are blown and your simple little reno has spiralled out of control. Luckily, it doesn’t have to be this way!

It’s absolutely possible to renovate on a budget. All it takes is some planning, prioritising and finding creative ways to save. Every dollar counts and there are loads of ways you can avoid paying full price. So as long as you go about it strategically, you might be surprised by how cheaply you can renovate your home.

Set a budget
Before you can even start planning your renovations you need to work out how much you can spend. A rule of thumb for renovating is to spend no more than 10% of your home’s current value. So to come in under budget, plan to spend only 5% of the value, leaving you some wiggle room in case you need it.
If you don’t have access to the cash you need to renovate you might want to think about refinancing. Refinancing is essentially paying out your current home loan and taking out a new loan that better meets your needs, either with your current lender or a different lender. It’s a simple process and one of the easiest ways to get the cash you need for your renovation.

Write a plan
While you might be itching to take a hammer to that interior wall, the first tools you’ll need are a pen and paper. Sit down and write a list of what needs to be done, prioritising everything from the most to the least important. Be strategic – if you’re thinking of renovating for profit when selling, you might prioritise renovating the kitchen, but if it’s for personal reasons then focus on where you spend the most time. Always keeping in mind, however, how your renovations might affect the house’s value if you decide to sell further down the track. If your focus is keeping everything under budget and saving as much as possible, you could even explore cheaper ways to sell your home to avoid paying that costly commission.
Once you have a plan in place, make sure to get in touch with your local council to ensure your plans comply with regulations and apply for any necessary permits before getting started.

Choosing DIY vs. professionals
Maybe you’ve watched every season of The Block and you’re ready to tackle the renovations yourself. That’s great! A DIY renovation can save you thousands on labour, not to mention the sense of achievement from doing it all yourself.
But how do you know if DIY is the right approach for you? Firstly, you need to have a certain skill level to get it done right. If you end up paying someone to fix your mistakes, it’s not going to be the cost saving exercise you’d hoped for. You’ll also need to keep in mind that if you have a full time job and can only renovate on weekends, you may end up living in a half-finished house for quite some time.
Sometimes the best way to go can be a combination of the two. The labouring hours that you can knock out on your own can save you a lot of money and you can then get the professionals in to do the more technical aspects (think plumbing).

Purchasing low cost materials
Whether you’re working with professionals or doing it yourself, one of the best ways to save money is by sourcing low cost materials. And that doesn’t mean cutting corners on quality! It’s just about being smart and looking for deals. Ask if your tradies if they have stock left over from other jobs that could be repurposed for your project. You can always try and hunt down second hand materials from scrapyards or even online using Gumtree to snag yourself a bargain. Just remember to be creative; floorboards can be used for bench tops, house bricks can be used for paving - you’re only limited by your imagination when it comes to renovating so shop around and see where you can save.

A high quality renovation will almost always add value to your property. By putting a solid plan in place and sourcing materials at the right price, there’s no reason you can’t get the renovation you want while sticking to your budget.

Contact either Owun, Suzanne or Costa on 02 9517 1818 or to discuss your options. Or, if you feel like dropping in at our office, we are located at Suite 106, Flourmill Studios, 3 Gladstone Street, Newtown 2042. Be sure to share our blog on Facebook and Twitter and let others join the conversation!


Posted in: Refinancing

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