HOW TO ADD VALUE TO YOUR HOME
How do you boost the resale value of your home? Should you add a bathroom or another bedroom, should you create an outside entertaining area, or would a garage be better?
For the majority of us, our home is our most valuable asset, therefore it is important that any home improvement or renovation project is reviewed on the basis of whether it will add value to your property in the long run…or will you lose money if you go to sell down the track.
You will read many articles that talk about where to spend money when renovating and what rooms add the most value to a property. Whilst kitchens, bathrooms and bedrooms are always a priority for buyers, there are many additional ‘must-have’ features that buyers look for, that they are prepared to pay extra for, and these features vary dramatically from suburb to suburb.
Let’s put this in context…
Assume you own a house in the Lower North Shore in Sydney….we know that buyers in this area are prepared to pay more for a property with the following features:
71% want 3 bedrooms
27.7% want a pool
12.5% want a laundry
10.8% want a garden
However, when we look at Fairfield in Victoria, although they value the same number of bedrooms as the Lower North Shore, they also value different property features.
71% want 3 bedrooms
43.2% want a garden
12.4% want a balcony
11.8% want air-conditioning
As a property owner in either of these suburbs, ensuring your property has 3 bedrooms may be a good decision. Converting a two-bedroom property into a three-bedroom property may attract more buyers and in turn help push up the resale value.
Additionally, if you were in Fairfield it may be worth spending time and money on your garden. Perhaps adding an outside entertaining area or play area for the kids will help make your property more appealing when / if you go to sell. You get the idea, knowing what buyers’ value and are prepared to pay more for makes for smarter home improvement decisions.
If you are ‘renovating to stay’ of course it is important that your property is transformed into a home that you want to live in and therefore not all decisions should hinge on what future buyers want, but knowing this information can be valuable when working out where to spend your hard earned money. Where could you add the most value to your property.
But where do you start and how can your local McGrath Area Specialist help you?
Step 1 Understand the value of your property
A good idea before you undertake any home improvement project is to understand what your property is worth in the current market. Your local McGrath Area Specialist lives and breathes real estate in your area and can provide you with a price estimate if you were to sell your property in the current market.
To get to this figure, they’ll conduct a detailed comparative market analysis and review similar properties that have sold within the last 90 days. They’ll consider the properties location, its features and how desirable they are, current competition, wider market trends, the condition and structure of your property and its overall presentation.
Once you know how much your home is worth you can determine how much you want to spend on home improvements. As a general rule if you are looking at selling your home in the near future or you’re renovating an investment, allow 10% of your property value for your renovation budget. For example, if your home is valued at $800,000 a good budget to work with is $80,000. However, if you’re planning on staying in your home for the long term, you may be able to spend more.
A property appraisal also gives you a benchmark on which to measure the value you’ve added to your property following your renovations.
To connect with your Local Area Specialist for an obligation free property appraisal.
Step 2 Understand the features buyers are prepared to pay more for in your suburb
As we highlighted above, having insights into what features buyers are prepared to pay more for, can be extremely valuable. Regardless of whether you are renovating to sell or renovating to stay, considering whether the home improvement makes financial sense and whether it will appeal to a wide range of people is important in the long run.
Our Local Area Specialists can provide you with unique and valuable insights into specific property features that buyers in your suburb have on their wish list, what features they are prepared to pay more for and we would love to share it with you.
Using data and local insights to power your home improvement project decisions, to create a property that appeals to more buyers is a smart decision
To connect with your local McGrath Area Specialist.
10 proven ways to add value to your property
Here are some practical ways property owners can add value to their property.
1. Refresh the exterior
We all know how important first impressions are, so spending time on enhancing your curb appeal can pay dividends. Consider painting the façade, fix loose bricks, cracked tiles. Add outside lighting, ensure the gate works well, the fence is in good condition and the paint is not extensively chipped.
2. Tidy up the garden
A well-presented and established garden is another way to appeal to both renters and future buyers. Consider spending money on landscaping, planting trees and easy to maintain plants. Add paving, top up the lawn and build garden beds.
A quick option here is to create an instant garden with ready-made containers and pots from garden centres.
3. Fix the flooring
Dirty and frayed carpets are not appealing to renters or buyers and heavily scuffed floorboards make the property look tired. Clean carpets or replace them if they are in bad condition. Consider sanding and recoating floorboards if they are very worn.
4. Update the kitchen
You do not need to spend a fortune, simply paint or replace old cupboards or change the door handles. Add a new benchtop and splashback if they are heavily stained or chipped and replace any old, leaky or rusty looking taps.
5. Refresh the bathroom
Try and make the bathroom look as inviting as possible, consider adding new fixtures or a new vanity. A large mirror is an economical way to dramatically enhance the space. If you cannot clean grime from tiles, consider replacing them and if the paint is old and dated consider repainting it.
6. Add some ‘extra’ features
Consider adding some extras like air conditioning / heating, good quality blinds or shutters.
If you are a landlord adding dishwasher or installing a washing machine and ensuring you have a good internet connection is popular with renters.
7. Add storage
Open plan living is popular with both buyers and renters, and these spaces can often benefit from extra storage to ensure they don’t feel overly busy and cluttered. Consider adding practical storage options, including built in’s, shelving and alcove storage. Backyard sheds are also popular if space allows.
Bedrooms can also benefit from additional storage, not only can the conceal clutter they can give a room a feeling of luxury and order.
8. Add an extra bedroom
If you have a spare room that is currently being used as an office or storage room, or a large one that could be divided into two, consider adding a stud wall. This can help increase your rent if you are a landlord and if you are an owner occupier, when you go to sell, an additional bedroom can add significant value to the sale price.
9. Outdoor entertaining
You don’t need to spend a fortune but adding a BBQ and outdoor seating is extremely popular with both future buyers and tenants. It creates a whole new space to live in. As we all love being outside this is can add significant appeal and value to your property.
10. Add parking if possible
Not all properties have the option to do this, but if possible, creating a car port or off-street parking is popular with both future buyers and tenants.
Before you get started on any larger scale property improvement project, it is a good idea to talk to your local McGrath Sales Agent or Property Manager about what buyers and renters in your area are looking for, and most importantly what they are prepared to pay more for.
Having insights into what will appeal to future buyers and renters without over capitalising, makes good financial sense.
ARTICLE PROVIDED BY.:
SARAH LEFEBVRE
18/11/19 | 7 MIN READ
https://www.mcgrath.com.au/advice/articles/value-add-renovations-for-your-suburb