What has been happening in the real estate market could be described as volatile, so a lot of property owners are considering renovations on their home in order to increase the value.
“Year on year, the number of renovation jobs posted on ServiceSeeking.com.au increased by almost 10 per cent” said chief executive, Jeremy Levitt. “This is because the appetite for real estate and The Block-style home improvement rises”.
But renovating your home and renovating your investment property are two very different things.
Renovating your home is based on emotion and comfort, whereas renovating for your investment property is about financial returns. For example, in an investment property you would typically resurface bathrooms, maybe replace handles and benchtops in the kitchen, whereas an owner occupied, you would replace most things.
The first question any renovator should ask is who the renovation is for.
When renovating an investment property, it’s all about who you are trying to impress with the renovation and your end goal. If you’re renovating your own home with intentions to live in it for five or more years, the demographic is yourself.
When the home is an investment property, the demographic is who you expect to buy the home when it is sold – an outcome heavily dependent on location and the type of home you have bought.
Yet not all renovations for investment properties are best done cheap – when looking at higher end homes, higher end buyers will expect more.
Quality and style
Understanding the demographic will quickly allow you to know what you should be spending and the quality to aim for. When it’s your own home and that demographic is yourself, you may include the high-quality fixtures and fittings you’ve always wanted. But for a rental property you should opt for the budget range.
Time is money
When choosing to renovate your home, your decision on how long to take and when to renovate will largely be dictated by your lifestyle, funds available and other personal considerations.
With an investment property, time is money and every delayed day or week is a mortgage repayment you have to make, often without a tenant in situ.
Sticking to tight deadlines and schedules, it is possible to co-ordinate tradespeople to come at the same time from the early morning. While this suits investment properties, being woken up at 7am every day by tradespeople in your own home wears thin.
When to renovate
Renovating your home is a personal choice, but renovating an investment is a strategic business decision. Some investors will look to renovate before or between tenancies, aiming to get the tenant to pay a little more each week, improve their cash flow and increase their equity.
Five “bang for your buck” investment property improvements
1. Update your kitchen with a cosmetic refresh: Tile paint, laminate paint, resurfacing.
2. Update your bathroom: Speciality paints can quickly update a bathroom, as can changing coloured shower screens to clear glass.
3. Paint internally and externally.
4. Update your floor coverings: Rip up old carpet.
5. Change your window coverings: Replace old curtains with white venetians or plantation shutters.
Contact either Owun, Suzanne or Costa on 02 9517 1818 or firstname.lastname@example.org 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!