In the world of real estate, the art of renovation can be both a passion and a lucrative investment. The Renovation Company, a prominent player in the Tauranga, Papamoa, and Mt Maunganui regions, specializes in transforming houses into gems through meticulous kitchen, bathroom, and whole house renovations. The philosophy is simple yet profound: make strategic changes that yield a minimum 200% return on your investment.
Property investment coach Steve Goodey, known for his expertise in buying, renovating, and reselling houses, shares a critical insight: avoid houses with structural problems. The allure of severely damaged properties is a common trap. Goodey's experience suggests that houses that are outdated, rather than dilapidated, offer better returns. A glaring example is a derelict house on Creswick Terrace in Northland, Wellington, which sold for $700,000 and required almost equal that amount in renovations, only to be valued at $1.6 million – a scenario fraught with challenges and narrow profit margins.
According to Goodey, cosmetic modifications are the most cost-effective. He emphasizes the importance of carpet and paint, which cover the largest surface areas and offer the most noticeable improvement for the least expense. Contrary to popular belief, replacing a roof, while essential, does not significantly increase a property's value, as buyers expect a functional roof in any purchase.
Michael Burge, another property investment coach, concurs, noting that flooring, paint, and curtains are economical paths to a significant return. With a budget of around $50,000 for these changes, a return of at least $100,000 is a reasonable expectation.
Bathrooms and kitchens are critical in any home renovation project. Goodey advises a like-for-like replacement approach to avoid the high costs associated with moving plumbing. Simple replacements and upgrades can significantly enhance the appeal of these spaces without breaking the bank.
An often-overlooked aspect of renovation is the sensory experience. Goodey suggests keeping newly carpeted or painted areas closed to preserve the fresh scent, enhancing the perception of newness and quality. Investing in good underlay for carpets adds a luxurious feel, further enticing potential buyers.
Finally, Goodey recommends maintaining a modern, clean, and somewhat neutral aesthetic. The goal is to appeal to the broadest range of potential buyers. While colorful and unique designs might attract some, they can alienate many. The use of furniture and home staging should introduce color and character, leaving the permanent aspects of the home relatively neutral.
The Renovation Company, guided by these principles and insights from seasoned property investment coaches like Steve Goodey and Michael Burge, offers a roadmap to successfully doubling your investment through strategic home renovations. The emphasis is on smart choices - selecting the right property, focusing on cosmetic changes, and maintaining a universal appeal - to ensure a profitable and satisfying renovation journey.