One of the greatest things about buying an established property is the ability to add value via renovation. In this particular situation, our client had purchased this property several years ago, and had maintain the property in its original condition achieving a relatively conservative rental yield of $340 a week, far below the median rent in the area and ultimately the property was ready for renovation being around 50 years old.
After transferring the management of the property to Hot Property Management our team quickly got on with planning and arranging a renovation. The scope of works included an internal and external repaint, removal of the flooring and polishing of the existing timber floors, removal and replacement of the kitchen, and also bathroom, updating of the laundry, and also just a general tidy up of maintenance items that had been left to let go overtime.
The goals with this renovation were;
1) Increase the rental yield of the property
2) Secure a quality long-term tenant
3) Reduce ongoing maintenance costs
As you can see all three of these goals have been achieved in this particular renovation with only six weeks down time for the works to occur.
Original Value: ~$625,000
Current Value: ~$725,000
Renovation Cost: $60,000
Equity Created: $40,000
Rental Before: $340 per week
Rental After: $500 Per week
Down Time for Renovation: ~6 Weeks