I have always been the equity buyer in real estate as I find it easier to add $20,000 - $50,000 to the value of my home than to get a second job! In so many cases the “ugly duckling” or the “renovator’s delight” is a great opportunity to make a quick buck. It was only 12 months ago that I witnessed the perfect example - a waterfront property here on the Sunshine Coast. I remember walking through this particular home thinking someone will snag this quickly, do ‘a job’ on it and re-sell within 12 months. It went on to sell for around $580,000.
Well, well, well, it didn’t take long at all for it to hit the market again with some simple, but noticeable changes. The new owners had rendered the front wall, applied a single coat of white paint throughout, added new turf, tidied the garden and yard and added a great little deck with a wood fired pizza oven.
This time when I went through on the Open for Inspection day, it was a totally different scenario from that previously. The wood fired pizza oven was burning and sending a nice fragrant smell through the home, the deck was lined with sun chairs and the corny coconut oil was burning to boot - it felt awesome! I imagined that each and every person who went through that place could picture themselves entertaining friends and family with pizza, whilst sunbaking with a fishing rod sitting in the canal. Needless to say, this effort earned the owners a quick $60,000 profit. Now, if you do the sums that equates to $1,153.85 tax-free for each week of the year they were there.
So, with all this in mind, I have a couple of quick tips for making your properties work for you:
- First impressions and street appeal are a great start (our local weekend markets are a great place to get plant bargains).
- Freshen up with a coat of paint - I recently picked up 40 litres of white paint at half price because it was a slight miss tint.
- Stick to a plan and budget. I like to get quotes from serviceseek.com. Don’t be afraid to name YOUR price.
- The use of technology - I love the app ‘Houzz’. I have created my own idea book – it’s very simple to do.
- Be aware of over capitalising - I spoke to a client last week who paid too much in labour costs and upgrades, making it very difficult to reach a break-even point in 18 months.