Slow and steady wins the race
Before embarking on a renovation, it’s important to seek professional advice from organisations such as Archicentre, the building service of the Australian Institute of Architects. According to Archicentre, renovation costs in Australia have dropped between 5 to 15 per cent in the past six months. David Hallett, general manager of Archicentre, believes that due to reduced interest rates we are seeing the best climate for residential construction for many years. With such ideal conditions it’s easy to see how potential renovators who are eager to get the job done rush into the process and fail to take the proper planning precautions. “Some renovators are paying between 60 to 80 per cent more for their renovations because they have poorly planned renovations and fail to tender their projects,” says David. For new houses and major renovations, labour generally makes up 33 per cent of the total cost, so it’s essential for renovators to obtain a variety of quotes to ensure they are getting a competitive price. Mr Hallett says that one of the other big mistakes made by people is that they get a quote only on the structural part of the renovation, failing to recognise that around 50 per cent of the cost is to be found after lock-up stage in fittings and finishes. Big blunders
It’s a familiar story: the family has outgrown their current dwelling so it’s time to upsize and upgrade. Rather than going through the heartache of finding a new home in an area everyone is happy with, you decide it makes financial sense to stay put and invest the $50,000 to $60,000 it costs to move into renovating your home and increasing its resale value. Achieving this successfully requires striking a delicate balance between your family’s wants and needs and those of potential buyers.
One of the most disturbing trends is people selecting extremely niche, inappropriate materials and designs that actually devalue their investments. “Some of the worst examples we have seen involve period houses where poorly designed flat roof extensions have been added, houses painted in garish colours and money poured into expensive kitchen and bathroom fittings at the expense of light and space,” says David. Another costly mistake is to inadvertently change the house from one market segment to another; for example, converting the third bedroom of a three-bedroom house into a walk-in-robe or ensuite will change the house from a three-bedroom house to a two-bedroom one with a drop in value of possibly $100,000 after spending perhaps $40,000 on the project.
Tried and tested
Presenting an attractive option to renovators desiring a cutting-edge design, trends have a tendency to detract from the value of the house, as they can lose their lustre and become passé over the years. It’s best to stick with the tried-and-tested methods such as a minimalist look, which proves functional and timeless, simple finishes and neutral or muted colours that can be modified with little trouble and multi-purpose rooms. It’s a woman’s world
Well-known kitchen and bathroom designer Rex Hirst from Let’s Talk Kitchens in Melbourne has an interesting take on renovating for profit, which involves targeting a specific — female — segment of the market.
“Essentially, men don’t ‘buy’ the house, our wives, partners and girlfriends do,” he says. “The man certainly goes through the inspection of the building, nodding in the appropriate places, but he is not nearly as closely connected to the process as the lady is.” Broadly speaking, Rex believes that when you’re renovating, you’re renovating to impress “her” not “him”. The two rooms where this is seen most is arguably the kitchen and bathroom. “If the kitchen and bathroom grab the lady’s attention, the house is well on the way to being at least placed on her shortlist, if not purchased,” explains Rex. “At its most basic, if you recognise the importance of the female’s ‘nesting instinct’ your efforts will be all the more relevant to a prospective buyer.”
When it comes to renovating your kitchen and bathroom, Rex advises keeping bells and whistles, such as soft-close runners and other internal fittings, to a minimum as these things are often not seen until later, by which time potential buyers have already formed their critical first impressions of the property. Instead, Rex believes money is better spent on fittings that will give the space “wow factor”. “Even though most lower-end canopies don’t extract very well, they are extremely eye-catching, so use them if your demographic is a younger one,” he says.
Keeping the costs down
If you have limited funds but are still looking to make improvements to your home, there are many popular low-cost options with known financial results. A new coat of paint is the best value for money. Colours should be neutral and elegant or, for a flashy result, apply a cement-based paint for a nice, textured finish. Floorboards are also a big seller, so if floorboards exist under carpet, tear up the carpet and polish the floorboards using an odour-free, water-based satin.
It’s also important not to neglect outside. A properly landscaped garden is like having an extra room in the house and if planned out correctly can be extremely cost-effective. A low-maintenance garden full of plants that require little watering is the safest route to take, while fruit trees such as olive, lemon and Kaffir lime trees are also popular. Carefully chosen, colourful vegetation will help create a striking façade that will entice potential buyers.
Striking it rich
Instant returns are certainly possible but are never guaranteed. A better strategy is to renovate with the intention of living in the property for at least five years. If the design is well conceived and the materials are tasteful, you can end up with good cash flow and better reselling options. Anecdotal evidence suggests that a well-designed renovation can add up to 10 per cent extra value over a less-inspiring alternative and can help realise a future sale quicker. | 
