When it’s time to spruce up an old property, you can’t just slap on any old coat of paint, make things a little bigger and call it a day. One expert lends his knowledge on what owners can do to make their property fit the situation.
According to investor and CEO of Binvested Nathan Birch, many Australians are overcapitalising when it comes to renovating property.
“Too many people are overcapitalising with unnecessary renovations,” Mr Birch said.
“When property values are rising, often they would have anyway as a result of the market, but when you’ve forked out $100,000 for a renovation you want to believe that had more to do with it.
“People think they can imitate shows like The Block, without having the team of behind-the-scenes tradies and sponsorship discounts to back them. It’s crazy.”
In order to make sure you do not overcapitalise, Mr Birch recommends to first have a reason why you are renovating a property – whether it’s cosmetic or structural.
“For me, if I can avoid it, I steer clear of structural renovations as they’re more likely to result in overcapitalising as the costs of labour have increased significantly in recent years,” he said, while he added “cosmetic renovations appeal to the emotions of buyers”.
When it comes to cosmetic renovations, Mr Birch pointed out two different paths to go down when renting or selling.
For renting, Mr Birch will paint every wall and all of the ceilings the same colour. His preference is ‘Whisper White’, which appears to have two different shades on walls and on ceilings.
This not only saves him quite a bit of money and time across his portfolio, but if any issues arise on the walls or ceilings, he only needs to remember the one colour.
Mr Birch also recommends using dark coloured carpets, “as these can get destroyed quickly by tenants.”
When intending to sell, Mr Birch will look at the walls as if it were for renting, but with additional touches, such as a feature wall.
Instead of a darker carpet, Mr Birch would opt for a lighter colour, as it makes the property “feel homely and appeal to the emotion of the buyer”.
When renovating, Mr Birch says the biggest mistake someone can make is to revert to personal aesthetic tastes.
“Just as when buying a property, research is your best friend here. Start by looking at what features other properties in the area have,” he said.
“I personally prefer carpet in a home, however different cultures will prefer tiles, timber or hard wood, so it’s important to understand the market that you’re doing the renovation for and tailor it accordingly.”