It is becoming increasingly challenging for buyers to enter the property market, as is evident by the average first-time buyer age which is around 37 years old. Sometimes the only way to get into the property market is to find a home that has potential and to renovate it over time as and when the funds become available.
READ: Tips: 3 ways to stay on budget when renovating your homeI
According to Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, renovating on a small budget might be challenging, but when done correctly, it can be the most profitable way to increase the resale value of your home.
“The trick with renovating any home is to avoid overcapitalising on the upgrades. This happens when the amount of money spent on improving a property exceeds the value those renovations add to the home. In other words, after the renovations, the home may be worth more, but not enough to recoup the costs of the improvements if you were to sell the property. Sometimes having a small renovation budget is helpful because it guards against this possibility,” he explains.
Whether you are updating a single room or tackling a whole-house renovation, RE/MAX of Southern Africa shares a few strategies that can help you maximize your budget and get the most value for your investment.
READ: Avoid these kitchen renovation mistakes
Prioritise and stagger your projects
Instead of tackling everything at once, break the project into manageable stages to help spread out the costs. Identify which areas of your home need the most attention and focus on those first. Tackle repairs and areas that could cause damage first. For example, replacing leaky windows or repairing the roof can get the home weather-tight and prevent further damages to the property.
Set a contingency budget
Before you begin any renovation project, determine how much you’re willing to spend and stick to it. Within this amount, set aside a portion as the contingency fund for unexpected expenses. As a rule of thumb, this is typically about 10-15% of your total budget.
DIY where possible
While certain tasks, such as electrical or plumbing work, should be left to professionals, there are plenty of other jobs you can tackle on your own. Painting, landscaping, fitting new cabinet hardware, and installing new light fixtures are all easy tasks that can cut down labour costs.
Hire the Right Professionals
Sometimes the most affordable contractors can end up being the most expensive contractors. Spending a bit more on a skilled professional can save you money in the long run by avoiding costly mistakes. Look for contractors with a solid reputation, fair pricing, and a history of delivering quality work. Get multiple quotes, check references, and make sure your contractor is licensed and insured.
“Renovating on a budget does not have to mean sacrificing quality or style. Careful planning, smart shopping, and a willingness to roll up your sleeves can help you achieve a beautiful and functional space without overspending. Involving a real estate agent can also help you gauge the possible returns on your investments and to avoid overcapitalising on your renovations,” Goslett says.
READ: Ways to ensure your home holds its value over time
Here are some ideas for home improvement projects that pay off courtesy of Home-Dzine:
Kitchens - Kitchen remodels are among the best for recouping the cost of renovations. Modernise with new appliances, counter tops and cabinets.
Bathrooms - Adding a bathroom increases the value of your home. So does upgrading an existing one. Adding new light fixtures, vanities with plenty of storage, ceramic tile or marble, and a new coat of paint are just some of the ways to improve a bathroom.
Outdoors - Building a deck or patio enhances your enjoyment of your garden and lets you recover approximately 85 percent of the project costs in added value.
Additions - Converting an attic into a bedroom or adding a family room are great ways to add value and make your home fit your needs as your family grows.
Painting - One of the most affordable and effective improvements you can make to your home is painting both the interior and exterior. Painting maintains the beauty and value of the home.
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