If you’ve bought a property to renovate without doing your due diligence, you’re already behind. You need to undertake some crucial steps, and understand where renovators commonly mess up, to ensure you’re covered.
Here at Smart Property Investment we’re all for getting experts on board to avoid future ‘hidden nasties’.
While not every property will require the same level of analysis and some will be easier than others, if you are looking at something more rundown and your budget is limited, it’s worth being extensive in both the checks you undertake and the advice you seek out.
“The main problem with buying anything that’s likely to have issues is falling short on the due diligence process,” warns Bernadette Janson director of The School of Renovating.
“If you’re planning to renovate a house, it’s worth doing a master plan up front,” advises Ms Janson. “When we were young and silly we’d have stars in our eyes seeing the property and you go in and just start doing things and you don’t coordinate it. You start to have to pull back what you’ve already done. Hold fire a bit and plan out what you’re intending to do.”
It’s also worth covering off on all those problems you can’t fix or that go beyond your intentions.
Pipe Perfection’s Darren Clancy has come across all sorts of “shoddy things” in his 20 years of plumbing. This includes garbage bags being suspended to catch water leaks, hose pipes being used to connect gas lines and owners covering up issues.
“[If the owners] are looking to hide something a lot of the time they’ll cover up the manhole panels so the building inspector can’t get into those areas, that’s an eye opener,” Mr Clancy suggests. Footpaths or paved areas with cutouts can also suggest problems.
From the offset, if it’s a property over 20 years old, and the pipes are made of clay (look where the sewer pipes come above the ground to find out the material), you may be up for replacing them. If they’re PVC, you can be confident they’ve been replaced, he says.
“Otherwise, start budgeting. Basically, $20,000 is where you’d start, with sewer and water pipes for about $5,000.”
For the unsure, plumbing checks and other inspections, in addition to building and pest, can be undertaken.
Brianna O’Neil from Styled by Hibernate shares the top trip-ups to be aware of:
- Being unaware of the overall goal
“Decide first up whether you are planning to stay long term or turn over quickly as this will affect your approach. If you are going purely for profit it's important not to get emotionally invested.”
- Not having a budget in place
“Doing things yourself verses what you should pay for - weigh up time versus money and how handy you are. If you have to take two weeks off a well paying job to paint a house, maybe it's worth your while to pay a painter/decorator.”
- Underestimating ‘miscellaneous costs’
“Tools, brushes, filler, sandpaper etc all adds up! Budget and then double it!”
TIP: Buy online to avoid impulse purchases and to get better deals
- Not looking at the project holistically
“If you are doing the bathroom, kitchen and laundry, get them quoted together so that cabinetry, tiles and fixtures have a sense of flow and consistency. Also it will be cheaper to have tradespeople come in once.”
- Not considering the future buyer or tenant (e.g. by getting too exciting with the colour palette)
“Neutrals are always safest for walls and floors. If you love bright colours, bring it in the artwork and decor so that it is easily changed.”
- Forgetting the property’s exterior
“Painting, rendering, roofing and landscape gardening is expensive. Whilst making some improvements to its curb appeal can add big profits, be aware that this can come at a cost so budget accordingly.”
- Taking shortcuts
“I've tried things like painting spray guns with little success. Sometimes it's best to just do it properly.”