With everyone spending more time at home in 2020, there has been a sharp spike in the number of people renovating. If you are amongst the many who have decided their property is in need of some TLC, whether it be to achieve a more modern look or to add more space, you need to start by asking yourself: How much should I spend? What areas should I focus on? And how can I avoid overcapitalising?
Let’s begin with the first question:
How much should I spend?
The answer is, it depends on your motivation. Are you renovating to sell or for lifestyle reasons and as a long-term investment?
If it’s to sell, consider the following general rule:
For every dollar you spend, you should expect $2 back in the sale.
If it’s for a long-term investment and lifestyle, opt for good quality, hard-wearing finishes and focus on renovations that have the greatest impact, such as the kitchen and bathrooms.
Click here for a short video in which The Block’s Shelley Craft and Domain’s Alice Stolz discuss whether or not it’s true that kitchens sell houses.
Interior designers also suggest not going over the top with colour when renovating, sticking to a neutral theme but adding touches of colour you love that can easily be transitioned back to neutral when it comes time to sell.
How much should I budget for a kitchen or bathroom renovation?
A full kitchen renovation installed by a professional will cost from around $30,000 upwards. For a DIY IKEA kitchen reno, expect to pay around $10,000 to $15,000. But at the end of the day, you get what you pay for.
As for a bathroom renovation, expect to pay anything from $20,000 upwards.
If you are working with an architect, it is recommended to have your builder look over the plans and price it for you before going ahead.
Any tips to save money when renovating?
If you are completing a partial renovation you could save a substantial amount of money by:
- Refacing your kitchen if the carcass and layout are fine,
- Changing the benchtop or respraying it,
- Adding a new, modern splashback, handles and tapware,
- Updating your lighting, such as installing a statement pendant light,
- Updating your flooring (engineered floorboards start at around $20 a square metre and can dramatically lift the look and feel of a property),
- A fresh coat of paint (especially if you do it yourself),
- Giving your garden some love.
How do I avoid overcapitalising when renovating?
According to the experts, it is harder to overcapitalise closer to the city than it is in the outer suburbs. If the property you are renovating is further from the city, the best advice is to keep it simple and focus on the fundamentals, which first and foremost is space these days.
If you’re renovating to sell, think carefully about the target market: who will be living there? Will it be a family, a professional couple or empty nesters? A professional real estate agent will guide you on that. Once you know the type of buyer for your property, renovate to their needs. It’s also a good idea to research median house prices in your area for properties like yours to avoid overdoing the renovation and over-spending.