GETTING FULL VALUE FOR YOUR HOMES RENOVATIONS
Depending on your motivations for renovating, you could be looking at a few changes or a complete overhaul. It is important to make sure you are going to get a good return on your investment especially if you are looking to renovate to sell soon. Significant investment might turn your home into your castle but if you are looking to recoup that investment when you sell it is good to know how much to invest where.
What adds the most value to your home?
It is the kitchen and bathroom that will deliver the most increase in value from a renovation project, but you always must keep in mind the home and property, and the location. Whether or not “high specification” adds value varies. If you put in a $30,000 bathroom or kitchen, whether it will add the same amount of value to your home as you spend depends on the home and the neighbourhood. The kitchen and bathroom are a good place to spend money, but you can overdo it. Spending money on kitchens and bathrooms will usually add value to a home. But if you want to know whether to spend $10,000 or $30,000 on your bathroom makeover you need to consider the overall value and location of your home. On a higher priced property, you are likely to add at least the value of a ‘high spec’ bathroom but at the lower end then you might be better to spend $10,000 instead. A modern kitchen that doesn’t break the bank will still add value to a home. But if you spend $40,000 on a kitchen in a modest home, you may not get the same value back.
What about insulation and heat pumps?
Insulation and heat pumps are expected today. If your home does not have insulation or heating it may detract from the value so this is a good investment and will usually add some value. Solar panels could result in an increase in value, but it is difficult to quantify because cost and value are not the same. You also need to consider what benefits the solar power brings and whether these benefits will be returned over a long or short period.
How much value does landscaping add to your home?
Tidy and well-presented landscaping can add a significant amount of value a property. However, it may not be a direct relationship between value spent and value added. The added value of well-presented landscaping is generally on the overall saleability of a home through increased street appeal/utility. It is a great way to get potential purchasers through your home on open homes. Regarding how much should be spent on landscaping, it really depends on the overall value level and type of property. The market expectation of the level of landscaping in a high value suburb is significantly greater than that of a lower value suburb. The nature of the property can also dictate the nature of the landscaping and site development utilised. For example, if you own a high-end character villa you ideally want to keep that timber picket fence out front rather than replace it with something more modern. Property owners should consider the nature of their property and the wider neighbourhood before commencing any major landscaping works. An example of this could be replacing timber joinery in a villa/character bungalow with modern aluminium joinery as this does not enhance the character and detracts from the value.
Does new carpet and a new roof add value?
These are generally considered as on-going maintenance costs. From a valuation point of view, the focus is more along the lines of what would it cost to rectify any issues caused by not maintaining items of this nature rather than the value that they may add to your property. Because carpets are a chattel, generally they won’t add value but will maintain value and help with saleability. Your roof falls under repairs and maintenance. The roof on a house is expected to be functional and do its job. You will lose money if it leaks otherwise it is just a cost. You wouldn’t do it unless it’s needed. If the roof of the dwelling is well maintained, functional and in reasonable condition, you will not add huge value by putting on a new roof. But if the roof is leaking and does need replacing then this will detract from the value of a home quite substantially so it is worth renewing your roof if it needs replacing.
Does a garage add value?
The added value of garaging is also very dependent on the locality of the property. In areas which have larger land sites and generally more space, a new garage may not add much in value. However, in inner city suburbs where land is at a premium and the lots are much smaller and off-street parking is scarce, a garage could add a
significant amount of value to your property.