A recent article written by by Michael Matusik and published in the Courier Mail, gives valuable insight into the considerations and actions that should be pursued to ensure a successful home renovation.
NO matter how simple it may look on those made-for-TV programs, successful renovations don’t just happen. They require research, knowledge and planning.
A recent survey by the Commonwealth Bank found that almost 60 per cent of their clients were forced to make compromises to home renovation projects, including delaying work, simplifying plans or using cheaper materials.
Almost 75 per cent had failed to seek early financial advice from their lender and most had gone over budget as well as over time.
It is estimated that each year Australians spend in the vicinity of $30 billion on major alterations and additions — that’s around 40 per cent of our national residential investment.
When factoring in more minor alterations, the annual spend on renovations lifts to over 50 per cent.
According to Mortgage Choice, some 43 per cent of homeowners have said they are planning to renovate their homes this year — and the majority are planning to do so for lifestyle reasons.
Here are some tips to help with the renovation process.
Be clear from the outset what you want to achieve and what you can afford. For a major renovation you will need to get advice from an architect or designer. And from there, develop a plan and a budget to help guide you through the process.
But make sure that your renovations fit in with the local demographic of the area, so that when it comes time to sell, there is a ready market for your home.
Knowing your target market will help direct the focus of renovations to areas that will appeal to potential buyers and occupants; and ultimately help to bring in the best sales price.
Know where to invest your renovation dollars, and where to save them.
If you are renovating to sell, painting is still the cheapest option for maximum effect. Other basic improvements, like rendering the exterior of an outdated home, replacing old skirting boards, adding new flooring, or replacing window coverings, can do wonders without an enormous outlay of money.
The most expensive areas to renovate can be kitchens and bathrooms. But these two areas generally have the most impact on the value of a property.
Buyers are usually willing to pay a premium for homes with renovated kitchens and bathrooms, providing the renovations are done well.
This means using professionals to ensure quality work and great functional design.
The kitchen should be well-planned and in synch with the way today’s families use kitchens as multifunctional hubs for food preparation, family gatherings and entertaining.
But whether you are renovating for comfort or for profit, one of the traps to avoid is over capitalising. This occurs when a property is improved beyond its resale value.
Before you even start planning, get online and take a look at comparable homes for sale in your area, and their asking prices. That information should serve as guide for your overall renovations plan.
My rule of thumb has always been to cap spending at around 5 per cent of the total property value for kitchens; 2 per cent each for bathrooms and 3 per cent for landscaping.
For more information visit www.matusik.com.au
Story originally published in the Courier Mail on 29.09.2013