Warning: Don’t renovate before selling; THE demand for fixer-uppers in Brisbane is so strong, experts are warning sellers about the risk of renovating before listing
Sage advice here, best that you sell the dream to others.
Warning: Don’t renovate before selling THE demand for fixer-uppers in Brisbane is so strong, property experts are warning homeowners about the risk of renovating before they list.
THE demand for fixer-uppers in Brisbane is so strong, property experts are warning homeowners about the risk of renovating before they list.
SQM Research managing director Louis Christopher said too often people splash too much cash jazzing up their homes for a big sale.
“In a downturn, buyers will not value the renovations as much as the homeowner,” Mr Christopher said. “We know the market will penalise over-capitalisation.”
Star of Foxtel’s new show Love It or List It and design guru Neale Whitaker agrees, adding the decision to sell or renovate a property demanded thought and research. “Be careful about overcapitalising — have a look at similar properties that are unrenovated like yours in your area and see what they’re going for — and the type yours would be like after a renovation and what they’re going for and work out whether it’s worth doing because, let’s face it, even the most basic renovation is costly,” he said.
Even the most basic renovations are costly.
“But if you are torn, look at the potential resale value of the house as opposed to the property you would be thinking of buying and whether that’s a realistic transaction — and also the value that could be potentially added to your home.” Whitaker said the majority of homeowners who decide to stay and renovate want to create more space. “If they’ve been living somewhere for a long time, they stop realising the potential under their nose but with careful planning they can create the space they need,” he said. “On the show we came across rooms that were completely redundant — one room was completely occupied by a cat — people get used to living a certain way.” Renovations are booming in the city’s inner-ring including Albion, Alderley and the CBD, with building renovations and carpentry the most popular, according to Australia’s largest network of trades professionals, hipages.com.au. The data also showed bathroom and kitchen upgrades were a high priority with homeowners. In the midst of this statewide renovation activity, Brisbane’s property market has slowed in terms of price growth in the last 12 months, outperformed by the stronger Sunshine Coast and Gold Coast property markets.
REA Group chief economist Nerida Conisbee said interstate and offshore buyers were keen on sea change. Data from realestate.com.au shows in the last six months, the most searched suburbs in the sunshine state were located by the water. Surfers Paradise topped the list with more than 213,290 views followed by Buderim (184,640) and Southport (184, 040). “Beaches and jobs are drawcards to those suburbs,” she said. “The lifestyle of these places are attracting people from Brisbane, Sydney, Melbourne and offshore.” Mr Christopher said homeowners could renovate their property on a budget, sell it and upgrade to a better property for themselves. “There are more buyers and freestanding houses in the marketplace,” he said. “I don’t think we are in a market that is going to value one’s renovations all too well.” Mr Christopher said Brisbane’s property market had improved however added “the pendulum is in the middle”. “We are seeing more interstate migrations to Brisbane because of the price difference,” he said. Love It Or List co-host Andrew Winter advised buyers to have realistic expectations when selling their property. “Don’t expect to sell easily,” Mr Winter said. “Never believe that your house will sell for more than market value, it can happen but generally it won’t.” He said to avoid sellers remorse it was important to hang on to your property if your financial situation allowed. “Keep house number one when you buy number two, however that is not always possible.”
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