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  • 7 top tips for renovating for profit

    7 top tips for renovating for profit

    Renovating for profit isn’t about simply painting a wall and watching the returns roll in. It’s about carefully adding real value over the long haul.

    We spoke to renovating expert and founder of The Makeover Group, Richard Armstrong, for his renovating-for-profit tips.

    Here are his seven renovation tips to set you up for success.

    1.     Get studying

    Take the emotion out of the equation and learn what improvements are most likely to add value to your property, versus the renovations that won’t improve the selling price for your style of home in your suburb and in the current market. Changes that don’t fit won’t fly, no matter how fancy they are, and your renovating for profit dreams could become a nightmare.

    7 top tips for renovating for profit - 1 
    When renovating for profit, simple is best.  Picture: The Makeover Group

    2.      It’s not about you

    If you’re looking to renovate for profit, adding ‘character’ can be a touchy subject, according to Richard. “There’s always a risk that your ‘character’ will be someone else’s turn-off. So, with this in mind, how do you ensure your improvements will add value?”

    The starting point is to think about your buyer. Consider their needs in a home and tailor your renovations to suit them. Are they a young family or are they empty-nesters?

    “If you’re targeting family buyers, some of the features you’d look to have would be; two bathrooms, three to four bedrooms, a kitchen with direct sight to the rear yard where the kids can play, secure gates/fences and a winter playroom,” Richard says.

    7 top tips for renovating for profit - 2 
     Renovating for profit can mean leaving your own tastes at the door. Picture: Unsplash

    “On the flipside, empty-nesters prefer a smaller footprint with two to three bedrooms (for an office and guests), higher-end fittings, low-maintenance yards and building materials, and close to public transport and shops.”

    The key when renovating for profit is to keep the renovation accessible to the buyer, according to Richard.

    “If you’re undertaking an extension, avoid ‘edgy’ and run with popular, proven finishes that are in vogue.

    “Lots of natural light, warm white walls and sociable open spaces always sell a home.”

    3.     Budget like a hawk

    This could be the most important point to note. Blowing out your renovation budget can breed cash-flow issues and unhappy suppliers, not to mention kill morale and raise blood pressure, so it pays to budget properly during a renovation.

    A professional valuer can help you estimate costs and craft a disciplined budget. Aim to double what you spend as your end game, and always add a buffer for those unpredictable hiccups.

    Richard suggests undertaking feasibility and cost estimates while weighing up market trends: “This is where you make your money.”

    He also suggests chatting with an accountant sooner rather than later about capital gains tax and repairs vs improvements: “The timing of your work and the period for which you hold your property makes a big difference to your taxable bottom line.”

    4.     Simple can work wonders

    There are plenty of small, low-cost improvements that could make a huge difference to your property’s value. Fresh paint, new light fittings, new bathroom fixtures and updating door handles can all help a place command more for rent or sale.

    Richard says to avoid overcapitalising don’t renovate your house to be the best on the street, instead aim for the second or third best.

    5.     Agents are your friend

    Sometimes agents will chat to a network of prospective buyers before they list properties. Connect with agents in the areas you’re looking to renovate-for-profit, and share your goals, so they can hit you up with a winner before the competition.

    6.     Build a team of workers

    Cleaners, painters, electricians, plumbers, roofers… Relying on professionals is usually essential when transforming a property safely and soundly. Invest in a competent team you trust and have a rapport with. Grievances and misunderstandings will cost you time and money, whereas finding the right tradies will save you money.

    Richard adds, “If you’re looking to add period detail to an older home’s facade, consider engaging a design expert who can advise on authentic finishes that stay true to the period.”

    When you want to renovate for profit it pays to have a good team around you.

    7 top tips for renovating for profit - 3 
    Picture: Unsplash

    7.     Add space

    Aussies have some of the biggest houses in the world and love having room to move! Enlarging or adding rooms is a popular way to create atmosphere and appeal.

    If you’ve already got larger areas, consider creating multiple rooms within these, especially if it increases the number of bathrooms or bedrooms in the home.

      

    Originally published on realestate.com.au as “6 top tips for renovating for profit

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    About the author

    • Raymond

      Raymond A Ram is the RAMbassador for RAMS Financial Group. Raymond works with the RAMS team to bring simple, helpful and expert information on home loans and savings accounts to life with his down to earth and cheeky personality. He enjoys seeing everyday Australians turn their dreams of saving for a goal or getting into a home a reality. 

      Growing up in Goulburn, NSW, Raymond was brought up with good old-fashioned Aussie values of hard work and a fair go. It soon became apparent that Raymond wasn't content for the conventional path of grazing, producing the very best wool, and finding a nice sheep to settle down with. So it wasn't long before his passion for performing and his talent as a likeable larrikin shone through - landing him a few roles such as 'RAMlet'. He was even tipped to play RAM-bo at one point but chose to become star of the small screen instead as RAMbassador for RAMS. He now finds this role so much more rewarding.

      Contact your local RAMS Home Loan Centre about your home loan options.

      Raymond A Ram

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  • Disclaimer:

    This information is general in nature and has been prepared without taking your objectives, needs and overall financial situation into account. For this reason, you should consider the appropriateness of the information to your own circumstances and, if necessary, seek appropriate professional advice.