Jacqueline Barton

There are many reasons to consider renovating, from making your property more liveable to driving up its market value and increasing the rental income if it’s an investment.

So, which renovations should you consider when looking to generate a return on investment? Here’s some inspiration.

The kitchen update

The kitchen is often the focal point of a property, and it gets a lot of use, so it’s little wonder kitchen updates often drive up resale value. Consider giving your kitchen a facelift by removing walls and making it open plan, adding islands or storage areas, or upgrading benchtops, splashbacks, cabinetry, and appliances.

While it may be tempting to completely rearrange your kitchen layout, relocating plumbing or electrical work can significantly add to your overall costs. Keeping the cabinets in place and simply replacing or resurfacing the doors can offer substantial savings.

Cost guide: Anywhere from $10,000 to $45,000+.

The bathroom remodel

After the kitchen, bathrooms are possibly the next most popular area of the home to renovate. Buyers and tenants love fresh, modern bathrooms, so it’s worth considering as part of your renovation plans.

You can start simple by replacing old grout and upgrading fixtures such as taps, sinks, showerheads, and mirrors. Re-tiling or adding new baths and showers will obviously cost more but may pay off in the long run. If you’re looking to get fancy, consider adding heated towel bars and flooring.

Cost guide: Anywhere from $8,000 to $35,000.

The curb appeal boost

First impressions count, and when it comes to prospective buyers or tenants, you want your property to make a good impact. Landscaping can help boost the property’s curb appeal and add value.

If it’s an investment property, low-maintenance plants are a smart choice. You may also consider adding lighting and updating the fencing to give your property that ‘wow’ factor.

Cost guide: It’s recommended to avoid spending more than 5% to 10% of the property’s value on landscaping. The national median property value is $779,819, so in this instance, budget for between $39,000 and $78,000.

Landscaping estimates vary widely, so make sure to consider multiple quotes before contracting a landscaper.

The granny flat build

If you have space for it, why not consider building a granny flat to increase your property’s value? Many homeowners are turning to granny flats to generate extra income.

According to CoreLogic, adding a granny flat could boost home values by 30 per cent and add around 27 per cent to rental income.

Be sure to get in touch with your local council to find out about planning permissions and anything else that’s required. It’s also a good idea to speak to your accountant about the tax implications.

Cost guide: The average cost to build a granny flat is $80,000 to $160,000.

The expansion

If your house is suitable, you could consider expanding the footprint of your home.

When you decide to expand your home, you generally have two options: build outwards or upwards. Many homeowners hesitate to add a second storey, fearing that the costs will be significantly higher than those of a ground-floor extension.

To reach a decision, you’ll need to weigh up your budget, your circumstances, the block of land, and your existing home to work out which option suits you. It’s estimated that building up will cost about 30% more than building out but could add between 30 to 60% to the value of your home.

Cost guide: Roughly $1,850 to $3,000 per square metre depending on the “degree of difficulty”.

Like to explore your finance options?

If you’ve paid down your mortgage somewhat or your property’s value has increased, you may be able to access your equity to get your reno off the ground. Otherwise, we can run you through other finance options available that could be available to you.

Please contact us for assistance.

*Costs and prices in this article are indicative and should only be used as a guide. They also vary locally and are subject to market forces.

As housing prices continue to soar, many people are increasingly considering whether to buy a tiny home to live in or as a holiday home.

The tiny house movement has been around for some time now, but despite its growing popularity, legislation is yet to catch up. This has left many confused about what’s legal, and what’s not.

If you’re interested in joining the tiny home movement, here are a few things you need to consider before buying.

Why people buy tiny homes

• The price factor – tiny homes vary in price according to the design and materials. DIY kits can start from $10,000 to $20,000 for a simple design, while custom builds can be closer to $200,000.
• Environmental factors – if the idea of living simply and reducing your environmental footprint appeals, a tiny home could work for you. You may even consider living of grid (with a rainwater tank, solar panels and a compost toilet, for example).
• Reduced expenses – living in a tiny home reduces running costs for things like water and electricity. Handy in this day and age.
• Flexibility – tiny homes ofer a diferent way of living, with the freedom to relocate in future (if your tiny house is on wheels).
• For investment purposes – some people rent out their tiny houses to generate additional income streams.

What are the regulations?

Things can get a bit murky when you dive into the regulations around tiny houses. The rules vary depending on location, and many councils don’t even have clear tiny house regulations, making it tricky for aspiring tiny homeowners.

There are two types of tiny homes – those on a foundation, and those on a trailer on wheels.

Tiny houses on a foundation are considered fixed dwellings and are usually treated like any other building, in the sense that you need council approval and building permits.

To get around these requirements, many people keep their tiny homes on wheels. Councils often apply the same rules to tiny houses as they do to caravans. The trailers that tiny houses are constructed on also need to comply with
certain standards.

In most states, there are limitations on how long you can permanently live in tiny homes on private land. Some councils are relaxing these rules.

Bottom line: Contact your state/territory government and local council before buying a tiny house to see what the latest regulations are that apply to you. You’ll also need to look into the maximum size limits of your tiny home.

You can find more information, including local laws and state regulations, on the Australian Tiny House Association website.

What about finance?

If you opt for a tiny home on wheels (and it’s legally classified as a caravan), applying for a home loan won’t work. But that doesn’t mean your tiny home dream is dead in the water.

We may be able to line you up with a personal loan, for example, or in some instances, you may be able to use your existing equity to fund the build. Speak to us and we’ll run you through your finance options.

If you need finance to purchase land to park your tiny home on, or for the vehicle to tow it, we can also help with that.

If you’re interested in joining the tiny home movement, get in touch and let’s put the wheels in motion.

All information is intended to be a guide only and should not be considered legal advice, it’s always best to contact your state and local councils before purchasing a tiny house.

With hundreds of thousands of mortgages rolling off fixed rate terms and property owners facing the mortgage cliff as they jump to higher variable repayments, a lot of investors are wondering whether now is a good time to refinance.

Reserve Bank of Australia (RBA) data shows there will be 450,000 mortgages coming off fixed terms in 2024.

The cash rate has been on hold since November at 4.35%, but many economists now expect the RBA’s next move to be a cash rate cut – likely a 25-basis point easing in the cash rate at the RBA’s September 23-24 board meeting.

So, should you hold and wait to see what the RBA does, or should you shop around for a more competitive loan now?

It all depends on your current mortgage rate, your financial goals and whether the benefit of refinancing outweighs the cost involved.

However, at the very least, it always pays to explore your options, especially when it comes to something as costly as your investment property.

Why it pays to consider refinancing

Refinancing your loan can allow you to access the equity in your property. Equity is the proportion of the property you own.

Say the property is worth $800,000 and you owe $200,000 to the bank. You have $600,000 in equity.

Savvy property investors use their equity for a variety of purposes:

• To renovate and add value to their investment property,
• As a deposit for their next investment property, or
• To fund their lifestyle and living expenses.

Another popular reason to refinance is to secure a more competitive interest rate or a loan that better suits your needs.

There may also be loan features that could improve your interest savings or cash flow like offset accounts and redraw facilities.

Key considerations before refinancing

1) How much equity do you have?

Generally, the right time to refinance your investment property is when the equity has grown sufficiently to take the next step in your investment strategy or to fund your renovation plans.

To get an idea of the value of your property and how much equity you have, you can:

• Ask us for a free property profile report with the latest market insights.
• Talk to local real estate agents for a market value estimate.
• Pay for a professional property valuation (a formal valuation will likely be required by the lender before they will allow you to refinance).

2) What is the cost of refinancing?

Switching lenders and refinancing your investment loan can help you achieve your goals, but there are costs involved.

These may include break fees or discharge fees, establishment fees for your new investment loan, and valuation fees.

Speak to us and we’ll run you through the costs and help you decide whether refinancing is worthwhile right now, or if it may be better to wait until your equity has grown further.

3) How is the market performing?

Part of the decision about whether to refinance will depend on how the property market is performing for your investment.

Nationally, property prices have been increasing in many capital cities in recent months and investors have been flooding back into the market.

Data from the Australian Bureau of Statistics shows lending to investors has jumped almost 20 per cent in the past year. Almost 4 in 10 people taking out a mortgage now are landlords.

If property prices were decreasing and you were facing negative equity territory, you probably wouldn’t be thinking about refinancing. But if your property value has increased, it may be the right time to weigh up your finance options.

Talk to us today

If you’re wondering whether refinancing is right for you, we can help you decide.

Whether you’re wanting to access equity to grow your investment portfolio or renovate, or you simply want to check that your investment loan is competitive, we’re here to help.

If the time is right for you to take the next step in your investment journey, we’ll find you the right refinance option to achieve your goals. Please get in touch with us to see how we can help.