Making a Profit from Renovating

Failure by people investing in renovation to undertake the basic steps in developing a relevant cost effective design, manage the project properly or choose materials that do not deteriorate quickly results in many people losing money in property investment or getting poor financial returns.


Before renovation of Mosman Bay property

Many people are throwing away the opportunity to make money through a lack of planning and careful assessment of their renovation. Once people have made fundamental mistakes in the design or have chosen the wrong materials, the hope of gaining a good return on the renovation is made very difficult.

One of the main difficulties is the lack of appropriate contractual agreement and signed off documentation between the owner and the builder or sub contractor. In some cases homeowners have spent tens of thousands of dollars on designs that do not add value to the home or are inappropriate.

Design, choice of materials, management, and documentation are major elements in ensuring a good financial return on a home renovation.

People undertaking a home renovation need to consider:

  • Assessment of the present value of the existing building and the forecast potential value of the renovated property to ensure the return is maximised. Location and the surrounding properties will influence forecast value.
  •   Assessment of the condition of the structure and services of the existing building. Structural inadequacies, building problems (such as termites and damp), sub-standard wiring and plumbing could easily add $15,000 to $40,000 in variation costs, if not identified before construction starts. An Archicentre Inspection Report can help here.

  •  The cost of the overall project to ensure that it falls within budget and borrowing capacity. It is a dangerous financial strategy to commence a project without a firm budget position. This could leave a project unfinished or cause unexpected borrowings, cutting the investment potential and return dramatically. Archicentre Renovation Reports include opinion of cost.


After renovation of Mosman Bay property
  •   Assessment of the present value of the existing building and the forecast potential value of the renovated property to ensure the return is maximised. Location and the surrounding properties will influence forecast value.


Bedroom with fantastic water views
  •  Assessment of the condition of the structure and services of the existing building. Structural inadequacies, building problems (such as termites and damp), sub-standard wiring and plumbing could easily add $15,000 to $40,000 in variation costs, if not identified before construction starts. An Archicentre Inspection Report can help here.

  •  The cost of the overall project to ensure that it falls within budget and borrowing capacity. It is a dangerous financial strategy to commence a project without a firm budget position. This could leave a project unfinished or cause unexpected borrowings, cutting the investment potential and return dramatically. Archicentre Renovation Reports include opinion of cost

  •  The planning of the basic design to ensure the renovation is compatible with the existing building appearance to avoid 'The Ugly Duckling Look'. The required planning guidelines will deliver an appropriate quality of construction and suitable lifestyle. This part of the concept design, which is included in an Archicentre Renovation Report should explore options to compare the best returns.

  •  An assessment of the fixtures and fittings, as often people over indulge on expensive fittings that have little investment return and can add upwards of $10,000 to $15,000 to the project unnecessarily.

  •  The cost of professional management of the project to avoid cost blowouts and to ensure adequate tender preparation and assessment, quality of construction, timing schedules, use of specified materials, quality of finish, appropriate permits and insurance is adhered to. The cost of an architect to plan, document, tender and supervise a project can usually be negotiated between 8% to 15% of the value of the project, but you may save up to 30% with the architect organizing competitive tenders.

Archicentre Renovation Report Click here