Renovations - Increasing Value

Hi All - I've been lurking on this forum for the past 12 months (since buying my home) and been using it to motivate me to get some work on my home............ which I've now decided to commence!

However, I now face a wee dilemma as I have a large number of jobs in mind, but it is likely that I wont afford all off them straight away.

Overall, the jobs I will be looking to do are:

- Downstairs renovation (Rumpus/Home Theatre/ 2nd Bathroom).
- 1st Bathroom (Cosmetic) renovation......... it is extremly DATED!!!
- Conversion of Two Car Garage to a 4th Bedroom
- Car Port
- Internal Stairs
- 2nd level Deck (6mx3.3m)
- Ground level decking around pool deck.
- Retaining Walls/Landscaping/Fencing that will reclaim about 20sq metres of our land (previous owners only fenced the pool leaving the rest as an enlarged nature strip!!!).
- Air Conditioning
- Solar Hot Water System.

So as you can see, there is a lot of work planned, but we're in this house for the long haul so we have time on our hands.

Our concern is that we may do the wrong jobs first, which will make it difficult to achieve the gains in value that will fund the other jobs (i.e. we will be periodically drawing on the equity), so was hoping that some of you friendly people might have some ideas on what jobs will provide the greatest gains in terms of cost to resulting value.

Our current thoughts are that we will do the Rumpus/Home Theatre room and 2nd Bathroom, as well as the internal stairs. However, our funds will only leave enough for one more job and we are tossing up between the renovation of the 1st bathroom or the 2nd level deck, any ideas?

Thanks in advance. :U

Thinking only about immediate value to your home, I think the priorities are:

1. Landscaping.
2. Bathrooms
3. Air Conditioning (?)

The rest.

Unfortunately, At the moment, I find that bank valuers dont really value a property that much higher when renovated, especially if there's been a valuation done recently (ie within that last 12 months). They're all pretty nervous about sticking their neck out and giving a realistic sale value.
In my experience the difference between bank valuation and sale price has been as much as $150,000.

To add value to a sale price is a different story. Presentation, Presentation, Presentation.
$10k on Aircond will add at best $10k to sale price, no real gain there.
A lick of paint and tidy up the gardens can offer returns 10 fold.

HI Digit

Your plan for renovating rests entirely with ever increasing valuations? If so then I hope the price you paid for your home was below the median valuation for your immediatte area.

Unless your property is substantially unique ( much better or much worse) from those around you - bank valuations will only increase by the average increase / decrease of the value of the house sales within a 500 mtre radius from you.

Bank valuers have often to comply with some very strict guidelines set down by lenders. They have to prove statistically that the valuation they give on your property can be justified in terms indicative sales in your area.

This is why for would be renovators the old rule of the "a bad house in a good street" should always apply.

Basically what I am saying is that if your house is more or less the same as everyone elses around you - it will be hard to fund reno's by creating extra value by reno's - especially as interest rates are on the rise.

If on the other hand there are houses selling for much more than you bought your house for nearby then your reno's may make you some wealth.

As a general rule value (x) is added by attention to the following areas

1) Street presence (- 30% to +30%) - how the house looks from the street. CHARM STYLE CHARACTER adds value. Detached carports are a no no (As a renovator I look for detached and incontiguous car ports - many dollars can be made by nuking em)

2) Entrance areas (10%) - are they inviting, interesting stylish, clearly defined

3) Bathrooms, Kitchens, laundry (20%) - depending on taste as to actual fitments but should be in very good order ,layout and repair.

4) Landscaping - often under estimated for the value it can add. (30%) . Landscaping can create views and aspects from windows where nothing except a panorama of the back fence exists now. And can create privacy etc . Under the heading of landscaping I include a shed/ storage area which is a must I think.

5) Homogenity - all areas of the property should impart a similiar level completeness, design, style and repair to max out value increases. If every room is diferent in dated fittings, type of finish etc it will come across as needing renoing again - not what you want at all.


These are only general recommendations based on my experience and the experience of friends over the years.


Air con and solar water wont add any extra value beyond what they cost.

I would be happy to give some more definite suggestions if you could post some pics and maybe a rough plan of your house - but also a pic of the most expensive house within 5 minutes walk from your place and or the streetscape .

Regards Doog

Quote:

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Originally Posted by Digit

So as you can see, there is a lot of work planned, but we're in this house for the long haul so we have time on our hands.

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As you're in the house for the long haul I suggest you do the things that will improve your living conditions and your lifestyle first. That way you can enjoy the benefits whilst doing the other jobs.

Just make sure that you have an overall plan and coordinate various jobs and finishes. No good doing one room and then find that you have to redo it because of work in another area.


Peter.

Thanks Guys, we've got no real concerns about the rise in properties as comparable homes (3bed 1 bathroom) in the area are selling for at least 12% more than what we paid 12 months ago. Although these homes have since dried up with very few now being on the market.

However, most of the homes on the market now appear to have been renovated beyond the original 3 bed and 1 bathroom that was once common in the area (which is what our is at the moment). The area is in a hills district with most homes being elevated, the renovations seem to have trended towards at least 4 bed, 2 bathroom, Rumpus and second level deck. You won't see one of these homes on the market for less than $400k.

As for the Banks, don't worry my partner and I are both in Banking so have factored that in too our assesment.

I hope the above helps, unfortunatley i don't have any pictures at this stage :(

Here is a link to the homes on the market in the area at the moment (via realestate.com.au) as it nmight help put the above into perspective:

http://www.realestate.com.au/cgi-bin...rea&t=res&q=Go

Ferny Hills - a good place to buy - lots of further growth in Values to go in next 6 years IMO. And a good range of prices and property styles also. And a lot of houses just ripe for bringing up to date.

I think the area is right for you to consider adding another bathroom and bedroom etc. No doubt you already know how much you could borrow - but try not to max out your LVR just yet.

Certainly I would consider the upstairs bathroom 1 as a priority and maybe consider putting in bathroom 2 at the same time - Plumbing costs could end up cheaper. The internal stairs and a bit of entrance door work would also be on the list of first jobs.

I would also be considering the landscaping ideas - large shrubs and trees take a while to grow so I often start planting these before anything else is done.

I still dont think it is a good idea to close in a double garage to make room for living areas - Impossible to advise without seeing the set up. It is very convenient in wet /cold weather to drive home - unload the car without getting wet. Just my thoughts.

Keep us posted and welcome to the forum.

By the way - if your house is the type I am thinking it could be (A highset 70's weatherboard or fibro box on a brick or block base) there is a lot of scope to improve the property very artfully. You might even have floorboards of Tasmanian Myrtle (lilypilly)!!

Cheers

Dont fall into the old trap of over capitalising,spending $150,000 on a house when you will never get your money back:U

Quote:

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Originally Posted by Dirty Doogie

Ferny Hills - a good place to buy - lots of further growth in Values to go in next 6 years IMO. And a good range of prices and property styles also. And a lot of houses just ripe for bringing up to date.

I think the area is right for you to consider adding another bathroom and bedroom etc. No doubt you already know how much you could borrow - but try not to max out your LVR just yet.

Certainly I would consider the upstairs bathroom 1 as a priority and maybe consider putting in bathroom 2 at the same time - Plumbing costs could end up cheaper. The internal stairs and a bit of entrance door work would also be on the list of first jobs.

I would also be considering the landscaping ideas - large shrubs and trees take a while to grow so I often start planting these before anything else is done.

I still dont think it is a good idea to close in a double garage to make room for living areas - Impossible to advise without seeing the set up. It is very convenient in wet /cold weather to drive home - unload the car without getting wet. Just my thoughts.

Keep us posted and welcome to the forum.

By the way - if your house is the type I am thinking it could be (A highset 70's weatherboard or fibro box on a brick or block base) there is a lot of scope to improve the property very artfully. You might even have floorboards of Tasmanian Myrtle (lilypilly)!!

Cheers

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You sound like you know the area well........ you got my house spot on (Although someone with some experience who has seen our house has mentioned the floorboards are actually Brushbox?).

We're lucky so far as landscaping is concerned that the house has a couple of mature Palm Trees around the pool area, coupled with some fantastic shrubs and hedging that have very much come to life over the last 12 months and look fantastic in the front yard. Our only frustration though is that the fence line around the pool is short of the actual property boundry, so its our intention to expand that and really ramp up the landscape in that space and really show off the size of the property itself, importantly though there are currently some fantastic gums and trees in that space which are technically ours but are instead part of a glorified nature strip at the moment!.

As for the built in garage, we were thinking of having the carport built on from the house where the current drive is, allowing us to also create an immediate entrance into the house from the carport into the house. However, any such decision will be based on the design being a natural fit (cosmetically) with the house itself. Fortunately the lay of the land should make this easy to acheive........... but this aspect is still on the drawing board!

Thanks for the tips, I'll keep you posted as we progress boh before and after........ as well as give you updates as we go.

Quote:

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Originally Posted by OLDPHART

Dont fall into the old trap of over capitalising,spending $150,000 on a house when you will never get your money back:U

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Thats ok, I'm Scottish so I instinctively resist any urge to part with my cash and spend money!!! :U

I agree with sturdee - if you're in for the long haul then isn't increasing the houses livability at minimum cost the equation?

And I'm sorry, but unless you're planning at least three kids then converting the garage to a fourth bedroom must be the very bottom of the list and remain there with all other future jobs jumping it so it never gets done. But by all means, build the carport. Let's face it, garages aren't really for cars. They're for tools and a work space (oh, and motorbikes).

A couple of other comments...

Air conditioning is great for the real hot days - but it's worth going for the good stuff so if it's too exe is there something else you can do. A regime of closing windows and curtains at certain times to maintain/release heat in the house works well but hard to adhere to. How is the roof ventilated, any sarking (OK putting this in can be exe). My roof isn't sarked and I've just put in a roof fan (12V electrical one - not wind driven which don't work anywhere near as well on the real hot still days) and I'm using my aircon much less now.

For the solar hot water I'd wait until your current unit carks it.

Dated bathroom. If it's all holding together I'd say bottom of the list. But then my girlfriend would put it at the top.

With landscaping - if you create a low tend garden then this can save you time for other jobs and may be worth moving up the list. Depends on what you're replacing. Maybe get it planned and time it for when you can get free fill and stone (someone local's putting in a pool or something) - but then you might not be a scab like me.

Cheers