Seeking out the ugly duckling has become a popular pastime. Nowadays, buying a house with the intention of undertaking a renovation to return a profit is fast becoming the chosen option, even for those non-investors amongst us. With property prices booming in suburbs all over Australia and the ultimate family home hard to come by, knowing how to target the more shabby properties on the market in strong holding suburbs is essential. When renovating for profit, the right property really does matter.
Let’s take a look at ways in which you can not only seek out a fabulous renovators dream but add value without over capitalising.
Location – choosing the right suburb
The suburb you choose to purchase property in really should always be one of the top priorities. Not only does it need to be convenient for work, family and life needs but should cater for the now and the future.
Consider browsing properties in areas that are in close proximity to the ones you love and more importantly suburbs that are on the fringe of being up and coming. Many locations that used to be undesirable are now flavour of the month because they are not yet highly sort after, are still relatively affordable and are in beautiful settings that are almost untouched.
Location is key and can be the foundation of a great investment. This is especially true for restoring derelict homes!
Don’t judge a book by its cover
Older homes were built to last. Whilst their facades may be tired, tattered and scream at you to continue driving past, consider that their foundations and structure might just be solid as a rock. And this is going to be a huge financial bonus.
If you can overlook the overgrown garden, the shabby paintwork and neglected look and feel, you might just be in for a great investment. A property that brings with it an overall good base can be a fabulous canvas for you to put your own special touches to.
You can even consider doing a church conversion! These can be great foundations to work off of.
Opt for cosmetic renovations – minimise structural changes
When planning to renovate for profit, it is wise to consider the potential return. Over-capitalising and making significant amendments to the structure will not only cost you a lot but you could also end up spending more money than you will get back in return when you ultimately sell. Remember if it is a property that you are keen to flip – in other words, buy, renovate and sell – then you need not put all your heart into it. Adding excessive extra touches, elements that you would want in your own personal home, are not a necessity.
Whilst there may always be the need for some minor structural adjustments, try to choose a house to purchase that needs more of a cosmetic facelift. A new kitchen, bathroom, coat of paint and shutters can instantly transform a home making it look like a million dollars. A few changes to the garden, minor landscaping and possibly some new shrubs and greenery can work wonders. The key is to spend money on adjustments that people can see and therefore appreciate. This is essential when it comes to reselling and aiming for a nice tidy profit.
Permits and heritage restrictions
Whilst you’re seeking the appropriate council and building permits before undertaking any renovations, always enquire as to whether the home is heritage listed. If it is, this can restrict much of what you do to the property. It can also be limiting if there are particular interior features that you are seeking to touch up and find that the accessories you require are now hard to come by.
Talking about building approvals, it is wise to have your intended house checked by a professional prior to buying. This ensures that any changes that have been made to the property over time are all above board. The last thing you want is to buy a home and find out that certain parts need to be demolished or worse still, extra financial outlays are needed to ensure the council gives you the tick of approval – all before you even start your own renovations.
Renovating for profit – Get a building inspection
If you think you have spotted a great renovator’s dream, before you count your lucky stars, it is wise to have the property inspected by a professional. What may seem structurally sound could very well not be. An independent property inspector will visit the property, inspect it from inside and out and provide you with a detailed report identifying all concerns, no matter how large or small, and give you the power to make an informed decision. Based on this report alone, you will have a great idea as to what your financial outlays may be to repair and renovate the property. This inspection will also verify any prior building renovations and can incorporate an all-important pest inspection, too.
It goes without saying that keeping an eye on your budget is also essential. You can very easily get carried away with buying a property and then spending way too much money in an effort to pretty it up. Buying a good renovator’s dream is an exciting and rewarding exercise. Prepare, plan and protect yourself by seeking the right advice from those in the know. When you are able to buy the right property in a developing suburb at the right price, you can easily and quite cheaply renovate it and make a profit.
If you are seriously considering purchasing a property in Brisbane with the intention of renovating for profit, seek professional advice first. Action Property Inspections will provide you with a detailed report identifying any concerns. Don’t enter the property market or commence a house renovation without this vital report in your hands.
Check out all the architectural issues you should consider for your renovations here.
Renovating for profit? Call Action Property Inspections today FREECALL 1800 642 465. Their independent advice will empower you to make the right decision. For further expert advice, click here.