Which renovations offer the best Return when you sell?
Not all renovations will make you a tidy profit when you come to sell your property. Some projects will cost more than they will ever give you back. So, what are the most lucrative projects to add value to your home and give you the best return come sales day?
KITCHEN
Updating or replacing the kitchen is one of the top renovations for profit. Modular kitchen can be a cost effective and fast way to update the liveability of a property. Use a custom kitchen builder wherever possible, as they will supply and install the cabinets as well as offer a warranty. Cost for a basic custom kitchen installed with all plumbing, electrical and tiling can be as little as $10,000. This can add enormous appeal and value to a property, with the increase in value sometimes being as much as $50,000 – $60,000.
The emotional connection between buyers and imagining living in the house they are buying is a bigger driver, so when renovating it is vital to spend money on the design of how the occupant will live in the area. For example, kitchens are now a lot larger areas with bigger fridges and ovens for entertaining and more casual dining.
However, when setting aside a budget for renovating it has to be consistent for a good return. An expensive oven with DIY cupboards does not work. Be consistent, realistic and look at the bigger picture.
BATHROOM
Update, or add bathrooms. The average number of bathrooms in new dwellings has been increased over time and this is being reflected in the renovation market as well. There are now on average 2.6 bathrooms per new home built.
If you are going to renovate or add a bathroom it is important to have a clear budget set out from the beginning of the project and always work to a fixed price. Buyers and tenants demand bathrooms to be modern and up to date with clean and stylish fixture and fittings. Be careful not to over capitalise.
REPAINTING
Renovations that help show off a home’s qualities, rather than detract from it have the best chance of providing a good return. Painting is always a great option to give a home a lift, with modern colours and shades. Paint is the most powerful renovation tool as you can instantly modernise and refresh a property in a contemporary colour scheme.
STREET APPEAL
When renovating a home with resale in mind, improvements that add to the street appeal of a home are always beneficial. Maximising the number of potential buyers that are enticed through the door is the first step towards ensuring that the sale price meets your expectations. Consider elements such as the garage or modernising cladding materials or colours.
The front door is an important element in the street appeal. Replacing with a modern door or simply painting with a rich, oil-based paint, can add a big “wow” factor. If garden beds are bare, garden mulch is an easy way to spark them up. Also, repair and paint the front fence, add a new letter box and new letter box numbers.
OUTDOOR AREA
There is a definite trend towards upgrading outdoor areas to more indoor/outdoor living. An alfresco area, in the past, was a Barbie on the patio, whereas now the outdoor area is an extra room, an all-weather extension of the house. The money spent on a well designed all weather outdoor area brings returns when the sale sign goes up.
The outdoor area is an emotional driver for buyers. They see the area, imagine themselves using it and already they are sold on the lifestyle it offers.
SUMMARY
With any home renovation for profit, plan renovations with a brand audience in mind, rather than injecting too many personal taste and preferences. The last thing you want is for buyers to factor post-sale renovations into the equation.
The same goes for poorly done renovations, particularly in the kitchen or bathroom, which can be off-putting for buyers. Consider using a professional so that buyers can picture themselves in the area for many years to come.
WANT TO SPEAK WITH A PROFESSIONAL?
Ask one of our friendly Team Members to take a personalised look at your property so you can make the best improvements to increase your return.
Contact the office:
Phone 09 440 5260 Email hello@CollettRealty.co.nz