Renovations have long been touted as the best way to inject quick growth into the value of your home or investments, with this being a key tool for any investor flipping properties. Suggestions on how much of a return you can see on renovations range from earning $2 to every $1 spent to five times this figure.
With data provided by view.com.au’s Property Price Estimates tool, it is now possible to highlight just the sorts of value growth households can expect to see after renovating.
Looking at comparable sales data for three like properties to that being analysed, it is possible to identify a gap in value that can be filled through renovations.
A three-bedroom, two-bathroom home in Caulfield South last sold for $1.39 million and now has an estimated value of $1.65 million. Its three comparable properties, generated by the Property Price Estimates algorithm, are each listed as having an estimated value of $1.51 million, $1.73 million and $1.63 million, indicating an average of $1.64 million across the three comparable properties and a difference in estimated value between these three as 18% or $253,000. With this information, it is possible to see that renovations within the Caulfield South home could help bridge this gap of over $200,000 in value, keeping in mind other variables that affect estimates (e.g. location, age, size).
With an investment of less than $70,000 (less than 5 per cent of the estimated value of the property), the homeowner of this Caulfield South home can expect to see this gap between the value estimate of their home and its three comparable properties to be significantly bridged.
Kitchens and bathrooms are traditionally the first rooms to attach within a home renovation, as they tend to provide the best return on investment, yet there are still other cost-effective renovations you can do throughout the home. For more thorough ideas, check out these renovations for every room in your home.