If you’re planning to sell your home, you’ll want to make sure it’s looking as good as possible so that you can get the best possible price for it.
Perhaps you’ve thought of doing a quick makeover or renovation to attract a higher sale price.
But how far should you go? Should you even renovate at all? If you do renovate, how do you know how much to spend, where to start and when to stop? How can you guard against over-capitalising? Getting it right can be a tricky business.
Sometimes real estate agents will advise potential vendors not to renovate. The problem with this is that it can give your buyer more room to negotiate.
The last thing you want is for the buyer to come in and start dictating the terms. If they’re looking at the house and thinking “Well, the kitchen needs doing and the bathroom is a mess, so I’ll deduct the costs of that from the sale price before making my offer”, before you know it, they will have offered $30,000 less than the asking price.
Ideally, you want to renovate for maximum improvement at minimal cost. Here’s how to do that:
Start at the end and not the beginning
Many people make the mistake of looking online or watching TV and trying to copy all the wonderful ideas they see there. The problem with this is they often have a variety of diverse ideas and can’t piece them together in a way that adds appeal and value to the house.
A better way to approach the renovation is to ask yourself what outcome you want. If you’re renovating to sell, your outcome should be that you want it to appeal to your target market so spend some time defining who that is.
Analyse your suburb and your property to see who it would appeal to.
Do a lot of young families settle there? Is it handy for families with teenagers because it’s close to local high schools? Is it attractive to single people without kids because it’s close to the city? Is it a quiet suburb, close to shops and public transport? Would it suit retirees?
You might find your suburb and property would appeal to more than one group.
What is the effect that you are trying to achieve?
Once you’ve defined your target group, think about how you can renovate to make your property more appealing to them.
If they’re a young family, having secure fencing might be important. If your target group is retirees, having a flat, even lawn and a nice, easy-care garden might be attractive.
Examine your renovation ideas.
Are the things you want to renovate ones that will make a difference to your target audience? Or are they things that would make it more appealing to you?
Sometimes they’re not the same thing, so ensure you are renovating with your target audience in mind rather than as if you were going to live there yourself.
How much do you want to spend?
It’s tempting to plunge straight into your renovation, especially when you have wonderful ideas about what you want to do.
However, it pays to stop and do some solid research on costs first.
It’s no good finding out halfway through the renovation that what you thought would cost $10,000 is actually going to cost closer to $30,000.
Whatever you intend on spending, ask yourself if you will make that money back on the sale of the property.