News

The Balance Between Renovating & Selling

By Nikkita Barlow

Most home owners will consider the idea of renovating at some stage during their time in a home; some renovate to make the home more liveable now and others to attempt to increase the sale price.

No matter what the reason is, you need to consider the cost of the renovation and compare that to the potential financial benefit.

This is important because overcapitalising can be a risk. While most investors have a good understanding of what overcapitalising is and how to avoid it, this is not always the case for owner–occupiers.

Overcapitalising is spending money on renovating your house that you are unable to recoup because the value of your house did not increase as expected.

This is less of an issue if you never have the intention of leaving your home but if you want to sell at a later date you need to think it through carefully.

It can be a particular issue if you are considering selling soon and are weighing up the value of a new kitchen or bathroom.

When you are planning to renovate it is prudent to consult an estate agent and architect or building designer.

In the first instance you need to consider how much your property is currently worth and how this compares to the median price in your area. If you spend too much on your house you may put it out of reach of buyers in that area.

Also consider how your renovated property will fit into the area in which you live, as buyers are often attracted to a particular area because of a style of housing.

Finally, if you are looking to sell and move in the shorter term it is important to consider if the cost of the renovations will be recouped by an increased value; if not, renovating is not going to be worth the time, stress and cost.

– REIV

Up to Date

Latest News

  • How to prepare your home for winter with Jamie Pagourelias

    Winter is the most important time to continue to hold a high standard for property maintenance. Whether your a new tenant or a homeowner, winter can bring a lot of added property maintenance issues that may not have been apparent during summer. For your own safety and/or your tenant’s safety, … Read more

    Read Full Post

  • Why the Customer Journey is Important with Marc Lum

    Have you ever wondered what the customer journey looks like for a real estate agent ? Ray White Glen Waverley’s Elite Agent, Marc Lum has a lot to offer in terms of what his customer journey looks like and what he firmly believes is the best method for continuing a … Read more

    Read Full Post