What are the implications of buying a property to renovate?

Many people are opting to buy homes to renovate, and there seems to be more people renovating their existing homes, said Lanice Steward, managing director of Knight Frank Residential SA. But what are the impilcations of buying a property to renovate?

While densification does fit in with the City of Cape Town’s need to remedy the shortage of housing, this should be done with sensitivity and thought to the look and feel of the renovation, she said.

“If you are buying to renovate, the most important thing to remember is that the money spent on the renovations must all add the right value to the completed home,” said Steward.

Frequently many badly thought out renovations are carried out, where costly changes have been made but when the owner comes to selling and is looking to cover the costs of the upgrades, finds that he doesn’t have the right value add, she said.

For example, if a buyer is considering building rooms such as a sewing room or craft room off the main bedroom (which is a very personal and unique use area), they should consider putting this room in a central position so that it can be used in an alternative way by other purchasers later.

Another example is when a home that was once a four bedroom family home has been converted into a two bedroom home, because the owners wanted larger proportions and, perhaps dressing rooms in the bedrooms. If this is to be done, it should be with thought to how the new buyer might be able to turn it back into a four bedroom house, without too much cost or complication, she said.

There is, too, a modern trend to create air-conditioned wine rooms that are features and placed in prominent places of the home. The placement of these needs careful thought as many have been built actually blocking off sections of living rooms or part of the entrance hall, which impedes the natural flow of the house.

“What needs to be remembered,” said Steward, “is that trends come and go, and anything built on or added to a home might not be wanted by the future buyers. Make sure the value of the renovation is in proportion with the value of the property and maximum that could be achieved in the area when selling it.

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