Renovating your home

2012-09-08 09:31

It’s cheaper to spend money on extending your existing house rather buying a larger one

If your family home is bursting at the seams, renovating your existing home may make more sense than buying a larger one, especially once you calculate the real cost of selling and buying property.

By the time you have added all the transaction costs and your increased repayment on your higher mortgage, it
may make sense to stay where you are and spend that money on renovating for more space (see sidebar).

However, it is important to make sure that what you spend your money on will add value to your property.

A starting point is to speak to agents in the area to ensure you do not overcapitalise.

Most neighbourhoods have a cap on how much a house will sell for, so you want to make sure you don’t spend more than you can hope to sell for one day.

Adding value

According to Linda Rall, the KwaZulu-Natal sales manager at bond-origination company ooba, add-ons that add value in most cases are extra bedrooms, bathrooms, garages, pools or cottages.

Also be aware of what adds value and what does not. For example, Rall says, while you might want a certain unusual feature or space, these aren’t necessarily a marketable value to the average homebuyer.

Jenny Langton of estate agency RattleWalton says other aspects which enhance resale value include domestic accommodation or a form of ”incoming generating” area.

The quality of the workmanship is very important and can add or detract value. “Badly finished building, poor paint jobs and ill-fitting units immediately set off alarm bells for any prospective buyer that they might have to
fix problems.

So make sure you don’t cut corners and you get the right person in to do the job,” says Rall.

Watch the flow

Although adding an extra bedroom can add value, if it is poorly placed within the structure of the house it could actually be a deterrent.

Would your guests have to walk through a bedroom to enter the house?

Rall says problems like an illogical flow, cluttered space or the loss of a garden will more likely bring the value of your property down than push it up.

It’s also important to stay in keeping with the original style of the house – if you have wooden floors and high ceilings, a small, carpeted fourth bedroom isn’t going to give you much of a return.

Inexpensive ways to improve your property
Even without spending a lot of money, you can improve the value of your home with some minor alterations.

Re-grouting bathroom tiles, replacing damaged, dirty or tired fittings, cleaning or refitting carpets or applying a new coat of paint will all create a good impression.

“Basically, take a look at every room in the house as if you were a buyer and try to think what you would want to fix,” suggests Rall, “then make an effort to address those problem areas and boost your sale price.”

Another area that can add significant value is the garden. Rall explains that neat beds, manicured lawns and well-maintained boundary walls all create a good impression, and can be quite easily achieved.

Even adding a few pot plants and a seat to an outdoor area can create a pleasant and usable space for you and your future buyer.

Watch your costs
The good news is that now is the time to undertake serious renovations or to get ready to build yourself a home as the industry is struggling and there are good discounts available.

Praven Subbramoney, the head of product and pricing at FNB Home Loans says that, historically, building costs were significantly higher per square metre than the cost of purchasing a similar home.

However, with the economy’s collapse, many builders and suppliers to the building industry have been forced to negotiate and building costs are now far closer to the real value of the home on completion.

If you stipulate that you have a strict budget, suppliers will be quick to tell you about less expensive options which provide the same level of finishes:

1 Newly installed bathrooms and kitchens are appealing to buyers but they can be very expensive so you need to shop around.

For example, Caeserstone, an engineered quartz, is very popular for kitchen tops at the moment.

However, it comes with a hefty price tag.

There are now locally made versions of engineered quartz, which provide an equally attractive finish at a much lower cost.

High gloss kitchens are also popular and this effect can be achieved more affordably by opting for PVC-wrapped kitchen units.

2 Although taps and finishes are important, this does not mean you have to opt for expensive imports.

Local manufacturers like Cobra, for example, have a very attractive range of products that are more affordable and far easier to replace, or to find a matching tap if you ever extend again.

3 Make sure you do not overspend on your swimming pool.

Langton says that while some people may want a pool, many are very happy about not having one due to the cost to maintain and run it.

Given that it costs anywhere from R20 000 to R50 000 to put in a pool, you need to decide if a pool is important to you or if you would rather spend that money on other areas.

A small pool that is easy to manage may be the best option.

4 Garages are very important to buyers, says Langton, but you can further increase the value by including additional space for plumbing and laundry items which will not cost significantly more to include.

5 Security is also very important, with perimeter walling and fencing adding value.

Langton says “upmarket” security such as American shutters, which double up as security bars, add cosmetic appeal as well as security.

However, these can be very expensive, so shop around and only use them in key visual areas where you need the shade and then opt for static burglar bars that look like American shutters but are fixed to the window.

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