RENOVATIONS – ARE YOU RENOVATING FOR FUN OR PROFIT?

Reception • January 22, 2018

Planning a renovation? Some people love to buy a new home, sit back, relax and do nothing. Others itch to renovate their home at some stage – especially if they believe in the age-old advice of buying the worst house in the best street.


If you are planning on living in your purchase for many years, it makes sense to ensure its renovation provides the features and inclusions that will enhance your lifestyle and support family changes over time. Beware though – when your heart is involved it’s easy to overcapitalise.


What if your property has been bought as an investment? When it comes to renovating an investment property it pays to leave your heart firmly tucked away and have your head in the right place. The ultimate aim is to maximise the return on your investment. The good news? You really don’t have to spend a fortune to make a profit.


As a general rule, renovations fall into two categories – structural and cosmetic.

Structural changes


These include changes to floorplans and structural additions which usually cost more but often have greater potential to add value to a property. For example, if you are adding a bedroom, it is likely the home’s value will edge up into the next price bracket depending on location.



Cosmetic changes


These involve aesthetic improvements such as painting and rendering, floor coverings as well as kitchen and bathroom upgrades. Cosmetic changes can add immediate pizzazz to a previously dowdy property, however they also start to depreciate as soon as they are finished. To ensure maximum impact from a cosmetic renovation it should be completed no more than 18 months prior to listing the property for sale.



Return on investment (ROI)


As a financial rule of thumb, your renovation should give you a return of at least $2 for every $1 you spend. It pays to do your homework in the local area:


  • How do sales of renovated properties compare with those in original condition?
  • What features make some properties highly appealing while others wallow on the market?


Visit recent developments that are selling fast to see what builders are doing to attract buyers.


Kitchen and bathroom renovations often deliver the best return but once again, do your homework. Some markets will pay for extra panache. The demographic of potential buyers will ultimately determine the most desirable features to consider in a renovation.



Fake it ‘til you make it!


It may be tempting to go for cheap materials but those that are poor quality can end up costing you more in repair and replacement costs.


Track down expensive looking fake or imitation finishes such as:


  • re-purposed or recycled materials
  • faux finishes that look like the expensive real thing, e.g. brick that looks like marble, laminate that look like granite, decorative paint finishes, and wallpapers which imitate other finishes
  • basswood instead of real timber venetians



DIY or professionals?


Reality TV shows like The Block have renewed interest in renovating across Australia. The true reality is that renovating your home can’t always be a DIY job.


Some tasks should only be attempted by a reputable, qualified tradesman. Yes, it may cost more initially to seek experienced help but it will save you time and money in the long run. Hiring a professional will ensure that the work completed meets building standards, preventing costly repairs. Jobs best left to a qualified tradesman include:


  • electrical work
  • plumbing
  • structural changes



Paying for your renovation


There may be a number of options for financing your renovation. These will be dependent on the size and cost of the renovation and your individual circumstances.


Options may include:


  • using the equity in your home
  • construction loan – for a major renovation
  • line of credit


Call the office and we would be pleased to book you in for a chat to discuss your finance options.


A renovation can definitely provide a profitable return on your investment. You can achieve this by a combination of research and using smart strategies for both materials and the services you hire. You may even benefit from tax deductions.

Disclaimer: This article is generic in nature. All finance and investment decisions should be considered wisely and based on your personal and financial circumstances. Seek proper advice before committing to any course of investment action. This is not deemed as advice. © 2016

4 Tips For Finding That Perfect High Yield Property

By Kola Dev • March 19, 2025
Any property guru worth their salt will tell you that a dream property investment has nothing to do with a prestigious address or sleek amenities. The ultimate goal, is to find that perfect “high yield” property that will give you maximum returns for as little input as possible. Yield refers to the amount of cash a property produces as a percentage of its value and is calculated by the rental income you are receiving compared to the purchase price. There’s a lot more that goes into the calculations, which I’m happy to run you through, but to give you an idea on what to look for, I’ve put together some simple tips. 1. Do your research. There are plenty of stats out there that will give you the median rental yield for each suburb. This is a great place to start! 2. Look for dual income properties such as a house with a granny flat. You can potentially have two streams of rent coming in, meaning the chance for a higher rental yield significantly increases. 3. Have you thought about looking rurally? Country towns offer some great properties at a low price and because the cost of living is low, the rental yields tend to be higher. 4. Always think forward. Be on the lookout for up-and-coming areas and ask yourself if they’ll still be flourishing in five years time. At the end of the day, you need to be realistic. Just because a property has a high yield doesn’t mean it’s going to be a great investment. As a mortgage broker, I can talk you through your options for investment loans so you can see what your monthly outgoings might look like. Please call our team on (03)8657 8664 or email reception@futurefinancegroup.com.au to arrange an appointment.

7 Quick Ways to Upgrade Your Home

By Kola Dev • March 19, 2025
The continuing boom in property prices has tempted many homeowners to invest in renovations to maximise the value and then put their home straight on to the market. There’s no doubt you stand a better chance of enjoying a great return on your investment if you modernise your home. Properties that enjoy a mix of the traditional and the contemporary are in big demand among today’s buyers and nothing ticks the boxes more than a brand new kitchen or bathroom. Two increasingly popular features at the moment are a dedicated home office and a design that connects the indoors with a garden or entertaining area. But renovation projects of this size can become expensive. If your budget doesn’t allow for large-scale upgrades, there are plenty of ways to enhance the value of your home at little cost. Here’s a seven-point guide to upgrade your home. 1. Break out the brushes It’s amazing how a fresh coat of paint will improve a property. Don’t focus only on the walls but attend to the skirting boards, ceilings and architraves. Select neutral colours as these make rooms feel bigger. 2. Go green Small-scale improvements to your gardens work wonders. Focus on the front yard as this creates an all-important first impression. 3. That’s entertainment If your property lacks an area to entertain, this is a great low-cost project to enhance your property’s desirability. Consider adding a deck or a barbeque area. 4. Floor ’em A mixture of different floor types can make a home feel bitsy while a home with consistent flooring creates a great sense of flow. Replacing the floor can be a painful project but you’ll be amazed how much bigger your home feels. 5. Say it with storage You can never have too much storage. A bedroom without built-in robes is just asking for clothes on the floor. Think about storage in bedrooms, bathrooms, kitchen and laundry and looks at ways to create clever storage solutions in nooks and under the stairs. 6. Kitchen upgrades If yours is a little tired, don’t worry – you don’t have to rip it out and spend big dollars. Consider replacing only the doors, drawers and handles. You’ll achieve a transformation at the lowest possible cost and it will feel like new. 7. Unbeatable bathroom Like the kitchen, this can be an expensive renovation. You can avoid replacing tiles by using a professional company to spray-paint them. This treatment can also be applied to sinks, baths and showers. New tapware and shower screens complete the refresh for a fraction of the cost of ripping and replacing. Please call our team on (03)8657 8664 or email reception@futurefinancegroup.com.au to arrange an appointment. *This article is provided for general information only and does not take into account the specific needs, objectives or circumstances of the reader. Before acting on any information, you should consider whether it is appropriate for your personal circumstances, carry out your own research and seek professional advice.

7 Tips for Organising Your Finances Before You Buy A Home

By Kola Dev • March 13, 2025
There are many tips for buying a property, but there’s one essential element that no one can avoid - getting your finances in great shape before you start. Knowing what you can afford is a critical element of finding your first home or the next one that takes you higher up the property ladder. The most successful buyers begin their search with their finances in order and a pre-approval letter from their bank or lender. They know their budget and tailor their efforts accordingly. There’s no greater waste of time than visiting properties that are beyond your price range. Using a mortgage broker can help you shortcut the hours of research through various banking products and good brokers have detailed market knowledge and can offer an array of products. We can suggest the loans most suitable to your circumstances and assist you with paperwork, and review your credit history. We can also help you understand any grants or tax exemptions from state and federal governments that you may be eligible for. Below are a few tips for securing the finance that will help you find your dream home. 1. Clarify your finances If you’re a homeowner, you’ll need to obtain a valuation on your current property and provide proof of current earnings. A first-time buyer will ideally have 10% of the purchase price as a deposit to get the best interest rate and conditions for their first loan but the more the better. Money for legal fees, property inspections and taxes need to be set aside, too. Make sure your tax returns are up to date to prove your earnings. It will make life easier. 2. Low barrier to entry You can obtain a conventional loan with as little as 5% of its total as your deposit. Some government-backed loans do not require a deposit. 3. It pays to save The more you save, the less you borrow. And that means lower your monthly repayments for you over the term of the loan. 4. Go for a grant First-home buyers should research the current grants from various levels of government that are designed to encourage them into the market. 5. Credit crunch You’ll need a good credit history to be attractive to lenders. Check yours out by using companies such as Experian and Equifax. If your track record is not the best, we can discuss ways to address this. If errors appear in your credit history, dispute them immediately. 6. Find the right loan You can save thousands of dollars by choosing the right mortgage product for your situation. It pays to shop around and make a note of not just the interest rate but the fees that come with it and other services that may be offered. As your mortgage broker, we can guide you through this process. 7. Be pre-approved A written undertaking from your lender will help you focus on what you can afford, as well as signal to a prospective seller and their agent that you’re not kicking tyres. Watch out for lenders who will only “pre-qualify” you, as this represents only an estimate of what you can afford and does not offer any guarantees of intention to lend. Please call our team on (03)8657 8664 or email reception@futurefinancegroup.com.au to arrange an appointment.
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