1. Don’t Pay Too Much
Buy at or under market value for a property. By doing your area due diligence, and using the research tools available at naritas.com.au, you will recognise a good deal very quickly.
2. Know What You’re Looking For
Examine the type of house that you are interested in purchasing and visualise it finished. Ask yourself: Can you renovate it using its current character? Does that style of home sell well in the area? How much changing around is needed to get it to the point where it looks attractive in today’s market?
3. Check Council Restrictions
If your intention is to renovate, then checks with the local Council are essential. You need to know that the house you are about to work on has all its previous building approvals in place and that nothing around it will impact its estimated post renovation value.
4. Get a Building Inspection
Organise a building inspection and pay particular attention to foundations and pest damage. These issues can be rectified but they cost money, so you will need to factor this into the price you offer for the property.
5. Get Quotes
Quotes from builders and tradespeople will help you recognise if the house is worth renovating, or if the money required to fix it up will leave you with little to no profit at the end. It’s important to listen to your builder.
6. Don’t Cut Corners
Never cut corners with building approvals. Always follow correct Council procedures. The Council will stand by you if there is a complaint, so long as you have all of your approvals and are fully compliant.
7. Consider Your Neighbours and Do Not Attempt to Overdevelop the Site.
Try to put yourself in their shoes and ask, “If this was happening next door to me, what would I be the most upset about?” They will already expect the building works to impact their peace and quiet.
8. Consult an Accountant
If you intend to flip the property upon renovation completion, see your accountant before you buy it. They may advise you to set up an appropriate company structure (e.g. a Trust) as the Tax Office will view you as a property trader if your purpose is to renovate to sell for profit.
9. Renovate to Your Target Market
Your renovation project should be designed around meeting the criteria of a purchaser, not just what you consider to be an improvement to its value.
Remember, planning ahead, structuring properly, buying like a professional and renovating to your customers’ requirements will increases your success rate!