Most home owners think that renovating or extending their property will increase their net gain when they do eventually sell, however research has shown it is often cheaper to sell the property and buy another.
Whether you renovate or extend, it is not always a cost effective way to improve your standard of living or accommodate that new family member. The arithmetic is not as simple as original value plus the cost of the extension equals final selling price. There are many more factors to consider when giving the valuation to the renovated house. The fluctuating property market will also mean that a house worth a certain amount one month could be worth a different amount the next. Therefore it is important to consult your agent about the peak seasons and best time to sell for your property.
Before going ahead home owners should consider the recent sales price of comparable properties being achieved for houses within their area. However beware of going by the advertised price, always follow through to see what the property actually sold for. Factors including being positioned on a corner block, a busy main road, having a south facing backyard, a sloping block or no lawn at all or even the materials used and quality of the structure of your home are all examples of characteristics that could potentially decrease the value of your property. It is important to do your research and be wary of these types of potentially damaging factors, as some you will be able to change – like the sloping block, where as others are a constant challenge – like being positioned on a busy main road.
Once you have received reliable quotes for the cost of your extensions, you are then in a position to put your equation together. By estimating the reasonable selling price of your home post renovations, and working out whether you believe it to be more than the original plus the quoted cost of the renovations to be done.
Above all make sure you don’t end up with the best house in the street or the surrounding properties will negatively affect yours. Alternatively, if you’re not feeling confident about your renovation objectives it is often easier to save yourself the time and energy and upgrade to another property instead of renovating.
We are only a phone call away if you would like some advaice on what is the right choice for you.
Wishing you all the best in achieving your property goals,
The Team at Richardson & Wrench Seaforth Balgowlah.