Once upon a time, it was the Australian dream to own a home.
If you were fortunate enough, it was to own several. There’s not a person alive interested in the property market who hasn’t entertained a fantasy of renovating an old place and ‘flipping’ it for profit.
But in a waning retail market, is it too late to earn the big bucks this way?
Not if you’re smart about it, according to Cherie Barber, a bonafide celebrity renovator who imparts her wisdom at Renovating For Profit.
“Renovation is almost a recession-proof strategy,” she told ten daily.
“The whole underlining premise is about adding value, regardless of what the market is doing.”
It comes with an understanding of the property cycle: boom, bust, slow down and recovery. The last 12 months in Australia have seen the property market slow down and bust, but just because less properties are selling doesn’t mean you sit on your hindquarters and wait for it to right itself.
“The worst thing you can ever do is do nothing,” said Barber.
The property investment cycle. Photo: Renovating For Profit.”You can still do a renovation in a down market. If there’s not a lot of buyers, you might get a 10 or 20 percent discount on your property.”
It’s really a glass-half-full situation. The question is: can you make a down market work for you?
It wasn’t too long ago that Barber set a new suburb record with her Sydney property in Leichhardt. She bought it four years ago for $950,000, did a structural reno, sat on it for a few years, then sold it 18 months ago for $3.6 million.
“Timing the market is essential,” she said.
The renovated Leighhardt property Barber sold for $3.6 million.
The three big areas of your property are the kitchen, bathroom and front facade — which is especially important when property isn’t moving.
“If you’re selling in a down market, buyers need to rock up and think, ‘This looks nice, I want to go inside’,” said Barber. “If it’s a shabby facade, they’ll keep driving.
And unless you’re working with a pricier property — above $750,000 — you don’t need brand name appliances or a total refit. Simply replace things like panels and drawers with budget furnishings and give it that once over.
Elsewhere, updating the “big six” items are going to give you the most bang for your buck: paint, floor coverings, window furnishings, built-ins, lighting and the ‘wow’ factor.
“Even a budget property deserves a wow factor,” said Barber. It doesn’t have to be super pricey, but something like a beautiful wallpaper or feature pendant light can take the place from “drab to fabulous”.
Floor coverings should be updated to something more modern than whatever old carpet or terracotta tiles you’ve inherited (wooden floorboards is a great one) and paint is like “liquid gold for renovators”.
“A fresh coat of paint can transform a property like no other change,” she said.
The big thing when renovating a property is to keep bringing it back to the value. Landscaping, for example, isn’t a big necessity for a cheaper house, but is vital for a multi-million dollar property.
“Typically, you want to concentrate on things that can be seen, not on things that can be hidden,” saidÂ Barber.
Unless your property is worth over $750,000, you’re wasting your money on an alarm system, smart house electrical cabling, or that $10,000 Melee cooktop.
Doorbells are also a complete overkill. Whoever rang the bell at an open for inspection?