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Buyers need a level head

Date

Stephanie Anderson

Calculating the costs of renovations you think are necessary can take some of the shine off house hunting, Stephanie Anderson writes

Something incredible happened at my kitchen table a few weeks ago - my little sister announced she is ready to buy a home.

Despite struggling with the fact that she is a mortgage-ready adult, not the chubby toddler in oversized glasses I still see her as, I agreed to help with the house hunt.

The search started off as fun, but soon flipping through property magazines and agent handouts descended into an odd version of Goldilocks with an investment fund. No house was just right - this bathroom was too dated, that kitchen too cramped or the laundry room took up far too much floor space.

From bench tops to tiles, every property we looked at needed some form of renovating.

However, my sister isn't the only picky house hunter, according to figures from the Housing Industry of Australia.

HIA ACT says renovation costs in the capital totalled $461 million in the last calendar year, reasonably close to new housing costs at $513 million.

Luckily there are some simple measures house hunters can take to ensure their renovation costs stay down.

HIA ACT executive director Neil Evans says the most important thing to check before agreeing to anything is the structural integrity of the home.

''If that's wrong, you'll have major problems with every room in the house,'' he says.

Evans says the one person a potential buyer should bring to a house inspection is a building inspector.

''If there are any signs of minor cracks, I would then go up a step and get a structural engineer involved,'' he says.

If the home is structurally sound, Evans says the next step for house hunters is to inspect bathrooms, laundries and kitchens.

''It's the wet areas that are the killers,'' he says.

''When you have to renovate these, you can run into some big figures. It is a good idea to get a specialist in to get some quotes, so you can build that into the overall cost.''

Evans says it's also important to get people with the right expertise - someone with experience in building new homes won't be much help when looking at an older home in need of renovations.

''Get people that work and have done a lot of work in this area, because it's very specialised,'' he says.

While redoing a kitchen or bathroom can end up costing a substantial amount - some bathtubs alone cost thousands of dollars - Evans says the investment will add significant value to the home.

''The kitchens and bathrooms are good selling points,'' he says.

''And you will recoup that outlay.''

That's good news for my house-hunting sister - she has her eye on a tub that will set her back a good few weeks' wages.

 

What's the essential element you look for when buying a home? Let us know by commenting below.

 

This reporter is on Twitter: @stephanieando

4 comments so far

  • Do you think you should be advising your little sister to be careful entering the property market at the moment? She should aim to be finding the best bargain in an attempt to avoid negative equity. By investing more into the property with a renovation, there will be no guarantee of getting a return on the investment in the forseable future, despite what Mr Evans says.

    Also note that the REIV have updated their clearance rate with an additional 7 properties counted in their auction stats than what they were reporting yesterday. Where did those extra 7 properties come from?

    Commenter
    Observer
    Location
    Melb
    Date and time
    June 14, 2012, 11:22AM
    • Hey Observer - Do you think you should be telling the author how to suck eggs?

      Commenter
      Local Knowledge
      Date and time
      June 16, 2012, 1:16PM
    • After location - location - location ......I think its important find a place that you can update inexpensively....so things like changing a shower screen, or installing a new vanity are inexpensive ways to modernise an old bathroom. In the kitchen, if it has enough space and good cupboard doors it helps.... because a coat of paint, a new splashback and new kitchen handles can bring sparkle back at minimal cost and are all things you can do yourself.

      Commenter
      KP
      Date and time
      June 16, 2012, 1:30PM
  • While looking at the wet areas ask yourself, is it so bad that it must be done immediately, ie fixtures dontwork, show signs of dripping, or can it wait a while. Most wet areas DO NOT need to be renovated before or immediately after you move in. That 70's kitchen may not be attractive but you can still cook in it and if this is meant to be your long term home, well you have plenty of years to do something about it.

    Commenter
    Jane2
    Date and time
    June 21, 2012, 9:27AM

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