Renovating? Read This First
Some of us renovate because we want to create our dream home. Some of us renovate because our house is our biggest asset, and we want to make sure it holds its worth. For most of us, however, it is a bit of both. We want to live in a home that suits us, but we also hope that the renovations we do today may help us when we are ready to sell.
So if you are planning a renovation, how do you spend your money wisely? Two experienced renovators – financial adviser Kate McCallum and Anna McMillan of McMillan Design – share the questions you need to ask yourself before you start spending.
How long are you going to stay?
“This is always the starting point,” says Kate. “The reality is every house depreciates year on year as it becomes less fashionable. If you are not likely to sell within the next 10 years, it makes sense to create the home you want to create.”
Conversely, the sooner you plan on selling, the more you want to play it safe with the look, says Anna. “You don’t want to go for any radical finishes or layouts – you want it to appeal to a broad selection of buyers.”
What is happening in the rest of your area?
If your aim is to recoup at least part of your costs, you need to be realistic about what buyers are looking for – and that will depend on what your neighbourhood is known for. “You don’t want a home that’s out of character for the area, because that cuts down your pool of potential buyers,” says Kate. If your neighbourhood is known for its heritage terraces, for instance, building a McMansion doesn’t make any sense.
Do you really need to do a full renovation?
If you are looking to make an impression on future buyers, Anna says that the three most important elements are contemporary kitchens and bathrooms and indoor-outdoor living areas. But if you just want to make the house feel more modern, you don’t necessarily need to start remodelling rooms. Small fixes can have a big impact.
“Places that are light and have a sense of space are in-demand, but that doesn’t necessarily mean knocking walls down,” Anna says. “Fresh paint colours and more contemporary light fittings make a big difference, particularly if you have the right tone for your place – warmer colours to soften a stark space and bright lighting to help a place feel bigger.” Ensuring the furniture is positioned correctly in a room can even create a sense of space.
Are you shopping smart?
“You want to be a price-maker, not a price-taker,” advises Kate. What does that mean? “If you explore your options and think about which trade-offs you are willing to make, you will find it easier to achieve the effect you want within the budget you have.”
Kate speaks from experience. “When we were redoing our bathroom recently, I really wanted to have a frameless glass panel on the shower,” she says. “However, the cost was double that of the next best option, which was a simple black frame. When we thought about it, the difference in the look was so minimal that we simply couldn’t justify the cost.”
Smart renovators also shop around. Websites such as Gumtree, where retailers sell excess stock, can offer massive savings. That goes double if you are patient enough to wait for the price drops when retailers get rid of the last of their range. “If you want to save money, take your time,” Kate advises. “Having time enables you to be a price-maker.”
Have you counted all the costs?
You have costed all your items, obtained quotes from tradesmen and are satisfied that your renovations will come in on budget. But there may be something you have overlooked. Are you borrowing money to fund your renovation? “The interest on the loan could easily add an extra three or 4 per cent on top of your costs – on $100,000, that’s an extra $3000 or $4000,” Kate says.
The other cost you may not have factored in is the time you spend shopping around. “Your time is valuable,” says Kate. “If you enjoy renovating, and you are spending your weekends shopping around for your own pleasure, that’s fine. Otherwise, you’re using time that could be spent on something else – so factor that into the equation.”
Words Ute Junker
Photo_ Yoann Siloine/UnSplash