Australia is in the grip of renovation mania, thanks to a booming property market and the many reality TV shows based around home improvements. Most renovations are aimed at improving the comfort of the homeowners, but many are designed for profit by investors or homeowners planning to sell.
In most cases, it’s a bit of both. The renovation will be lived in and enjoyed for some time, perhaps many years, but the property owner would like to see it add real value when the home is finally sold or rented out.
So which home improvements are most likely to add to the value of a home? Let’s take a look!
Adding Bedrooms
Adding additional bedrooms can be one of the best ways to add value to a home. A study by Andrew Crossley, author of Property Investing Made Simple showed that an additional bedroom is worth between $75,000 and $95,000 – this figure comes from comparing average values of 3- and 4-bedroom homes across several randomly selected suburbs around Australia.
Extra bedrooms can be added through reconfiguring existing space, however this is likely to have trade-offs in the reduction of living space. Additions or extensions are often the best choice for adding bedrooms without impacting living space. These additions can also include a second living space – and that all-important second bathroom.
Kitchens and Bathrooms
Kitchens and bathroom renovations are among the most popular types of home improvements, but do they really provide bang for buck?
If you plan to live in the home for several years and your plan is to update with a classic kitchen or bathroom design, then you might get the benefit of both worlds. However, more contemporary designs can date quite quickly so they may be better suited to people planning to renovate and sell sooner rather than later.
As a guide, the kitchen renovation should cost no more than 3-5% of the value of the home to avoid over-capitalisation, and the bathroom around 1-2%. Keep in mind that your taste may not be everyone’s, so if an imminent sale is on the agenda, stick to more neutral colours and simple but quality fixtures and fittings.
Walls and Floors
One of the most cost effective ways to add value is through painting – both interior and exterior. A well-chosen colour scheme that has universal aesthetic appeal will add real value. With exterior painting, a focus on the ‘’kerb appeal” is important as first impressions do count.
Floor finishes are important too, but don’t think that wall-to-wall carpets are the way to go. Most buyers these days are looking for low-maintenance floor finishes like timber, although carpets in bedrooms are still popular.
Outdoor improvements
Decks are a common addition that can add cost-effective living and entertaining space while adding real value to a home.
Landscaping when done well is also a value-adder, but it’s easy to over-do it, and many prospective home buyers may not be at all interested in maintaining a high-maintenance garden. The best rule of thumb is keep it simple.
Pools are near the bottom of the list when it comes to adding value. If you have kids and plan to live in your home through their childhood, then go for it, but don’t be under the illusion that adding a pool will add more value to your home than it cost you.
Need some advice?
We’ve been helping Sydney home owners improve their homes for over 30 years – both for pleasure and profit. If you’d like some advice on what types of improvements would be possible, cost-effective and profitable for your home, please get in touch – we’d love to have a chat!
All images via www.houzz.com.au
