Renovate or not?
Every day a home owner asks the question, “should we renovate and sell or sell this home as it is?” And every day a home owner gets the renovation bug and spends thousands of dollars on their aging home only to find that they really made no profit on the work after sale.
DIY and home renovation is an extremely enormous trade and market in Australia and with all the inspiring shows we see on television and the radio each day, it is hard not to get the bug! Absolutely everything we need is available at the local hardware and there are even hardware outlet who offer free reno classes.
All that is missing is experience. The experience required to select professional materials and not just buy what is presented in the sale catalogue; the experience to handle the difficulties of the job, to prepare the many different types of surfaces that people are confronted with, and the experience to know what can and cannot be achieved without council permission, without specialised tools or without time to cure products or allow them to settle so that inherent problems do not affect how the finish performs over time.
I can imagine a renovator reading this and saying what rubbish! We finished our home and it looked fantastic and also added $40,000 to the price of our home after selling at auction. But may I ask you who valued the home before and after auction? How many people have you surveyed to find out the percentage of those who lost money revamping their homes because they went to far and over capitalised and were not paid for what they put into their physically time consuming renovation?
The various home shows on television are unfortunately extremely misleading. They price the hundreds of projects that they finish in 2 days for the audience with materials and usually with no labour. They show their teams racing against the clock to finish jobs that should be done carefully over weeks. They paint walls without surface preparation and proper drying time and then the cameras don’t allow you to see how rough the surfaces are unless the light gives away their secret. It all looks so easy.
So what do we do if selling the home is intentional and a profit essential? You need to do a serious market survey and compare your home with what is in your street and area and what they had that you don’t. If you are the best home in your street, then you have already hit the top of your market and it will be hard to predict what you will get. In this situation you are reliant on finding a buyer who is simply as passionate about your home as you are, and hope that an emotional bid may allow your home to hold the new highest street price as a future comparative yard stick for others.
Ask any real estate agent and they will agree, that people are very house proud in Australia. It becomes an issue when they have spent many hard hours of renovation on their home, supposedly increasing the value of their home, and they are then told that it is still worth what it was before the improvement. That they have in fact simply over capitalised. No one wants to be told that such a thing. And because they have seen again and again on Hot Property people renovating and making huge profits on their old homes, that it must always be the case.
I must say that as an Interior Designer and someone who was looking over the past 3 years to purchase investment properties, I was able to walk in and spot the DIY jobs within minutes. Seeing this made me just look harder, for faults that the owners may have been hiding with fresh paint or new floor covers. In eight out of ten cases the paint job was appalling in both the finish, brush strokes and lack of coverage, or in the horrid array of brightly painted walls here and there as supposed features.
Then there were the many curtains that were actually stapled to the walls and pelmets that I knew could never be laundered without pulling them apart and fixing properly. The doors that I saw hung crookedly, the kitchen splash tiles that ran off on angles instead of straight rows and the holes in walls that had been filled not properly sanded and painted over. All of this will cause extra work later to a professional with a high standard of work.
Now let me say that to many people home renovation is fun, exciting and gives you a feeling of such achievement. For this reason I understand exactly why everyone wants to have a go in their own home. That’s the reason why I am an Interior designer myself, its fun! If funds are limited, fun is your motivation and you just want to live in a brightly coloured home that means a lot to you emotionally, then go right ahead! Our homes should be our safe haven, a place where we can do exactly what we want, when we want to.
However if you are redecorating your home to attract attention to a new buyer, then you need to look at the situation from a different perspective. Believe it or not I have seen a brand new granite / polyurethane 6 x 5 m kitchen removed and thrown out because the layout and colours were not the preference of the new owners. I have been called in on thousands of occasions to newly purchased homes to select new colours for new owners.
It actually costs new owners more money than usual to have walls that were painted in deep base colours repainted in lighter hues. Simply because the walls either have to be stripped if the paint job was bad or many coats of paint used to fade out the base colour and then recoat the wall with the new lighter colour.
The most obvious question to ask when renovating a house for sale is what colour to paint it. Colour psychology is a very real area of concern. If you have ever studied colour psychology then you will have some understanding of the effects that specific colours have on individual people. In my experience over the past 17 years, you will be psychologically turning some people off by the colours that you select for your home.
For example did you know that red makes you eat more and that orange / reds should not be used in kitchens unless you have people in a family with eating disorders. In very real and practical terms, if a diet conscious athlete was looking to buy your home and was confronted with an orange or red kitchen (or any combination of these colours, (tints, shades or greys) they may indeed be turned off buying the home based on the way it psychologically made them feel in one of the most commonly used rooms in the home. Blues and greens in contrast are colours that calm the nervous and digestive system down and do not initiate hunger in the majority of people in fact may even act to suppress hunger in many.
Colour is thus a very important addition to any home. You also need to understand it physical characteristics beyond its psychological ones. For example you must understand what colours are warm and cool. Yes this is a very fundamental trait of colours to reflect a warm or cool glow that many people do already know yet last night I actually saw a supposed “interior designer” refer to a grey green roman blind that she had just added to a warm coloured room as “giving the room such a beautiful warm glow”! A silly error.
Why a silly error? Because if you were to put a cool grey green in a room that happened to face due south, then the room would become cold, depressing and dull. Simply because the light is indirect, the room is in shadow most of the time and the colour light given to a room from the south is nothing like the warm glow of the northern sun. Thus a home should be analysed as to what orientation the room face and the colours chosen accordingly. If predominantly cool colours are added to the northern and western rooms, then this will balance out the warm heat applied to these rooms from the northern and western sun that will fall upon them. The same of the southern rooms and to an extent the eastern rooms, where they will have either no sun or just early morning sun and may do well with a warmer selection of colours.
Again I come back to the question of how far do we go when renovating a home for sale. I believe that a professional finish can be achieved with a very minor budget. It would be very worth bringing in a professional painter and painting the home in soft colours that provide the warm or cool contrast that we just spoke of, but that did not dominate the colours within your rooms. That you also invest your budget in hiring new, fresh furniture for the auction or sale period, so that the furnishings were not tired and worn and perhaps modernised the feel of the home.
But do remember to ask agents or companies like Residex for advice on what is an acceptable limit for your renovation work given the area you live in. Who knows the time you waste in redoing the decoration of your home in this economic climate and falling market may even mean a loss of dollars as the market falls if you take to long to get it on the market! I will not forget the many auctions of dilapidated homes that look as if they should have had defective notices from local councils, actually sell for the same or higher prices as newly renovated homes in the same area.
Remember, everyone out there wants to purchase a bargain. And they all hold the same opinion about freshly renovated homes; that have already been purchased and redone by someone else in order to make the profit they may be looking to make also. Why not give your next buyer a home worth renovating! It might be just the thing that attracts them to it.