You may have some ideas for home improvements you want to carry out in the near future, but you need to be sure which ones will increase the likelihood of a quick and profitable sale.
To climb the property ladder to your dream home, it’s important to know how to maximise the value of your existing home. Before starting major renovations, you must determine which home improvements will add the most value to your property.
Don’t overcapitalise
Over-capitalising means that what you have spent on your home - including the purchase price and the cost of alterations and improvements - exceeds the amount you could sell the house for in the near future.
To avoid this, the first thing to do is find out the average selling price of homes in your area. Each suburb usually has an average selling price, with most homes in a specific area selling within a certain price range.
Building a luxury five-bedroom house in an area popular with young, first-time buyers in two-bedroom homes makes little sense. Instead, it's far better to renovate or add on to a smaller home in an area with families who want the extra space.
The key is to focus on what would make the property more attractive to a buyer like you.
Improvements that increase value
A swimming pool may be a nice addition to have, but it probably won’t increase the sale price of your home.
The following improvements are almost certain to add value:
- Adding floor space to the main house. Extra bedrooms, extended rooms and open-plan living are all popular improvements.
- Building additional accommodation space. A granny flat for income generation or teenagers staying home for longer, parents living with their adult children and extended families moving in.
- Adding bathrooms. Additional bathrooms are always good options, especially in older homes with several bedrooms and only one bathroom.
- Kitchen. A more modern kitchen could add value to your home, but you need to ensure your renovation budget is in line with the price of the house. You probably won’t recoup the costs of spending R100 000 on a kitchen upgrade on a R1 million property.
- Outdoor entertainment area. A deck or patio that extends the living area could add additional value.
- Increased security is a top priority for most buyers. Burglar bars, security doors and burglar alarms are all desirable additions.
- Energy- and water-saving options. Solar panels, heat pumps, inverter systems and water storage tanks will likely appeal to buyers.
Improvements that won’t add value
Some luxury fittings and features may help you sell faster – especially in complexes where they allow your unit to stand out from the rest. However, you should make reasonably sure that the sale price will cover your costs and yield a profit.
The following improvements are unlikely to add substantial value:
- A swimming pool.
- Air conditioning.
- Replacing windows and doors.
- Landscaping.
- Installing a borehole
Cost-effective
To ensure you don’t lose money on your improvements, you need to plan carefully.
- Draw up a list of the improvements you need and those you can afford, and include quotations from the best service providers available.
- Hire reputable builders with a proven track record in the type of work that you need doing.
- Insist on high-quality workmanship and ensure any additions match the rest of the house.
Keep in mind that good budgeting and cost containment are essential because even small extras can quickly add up.
Writer: Sarah-Jane Meyer
