As we move into level 2 alert, businesses are gearing up to get started again and eager to get things back to normal. Every business is now being challenged to adapt and be flexible with how they’re conducting their business. They understand that the market is now different, and what has worked before may not work now.
We’ve found this to be the same in the renovation industry. At level 3, we’ve already begun conducting virtual meetings with clients enquiring about renovations and we’ve learned that the needs and concerns about renovating are no longer the same. There were 2 things we’ve learned in the past week, first is clients are mindful about how they’re going to be spending their money and renovating may only be seen as a luxury now. Second is, a large proportion of the enquiries are coming from investment property owners as opposed to homeowners.
There is definitely a high level of uncertainty at the moment and we have to be mindful of the current market. With that said, conversations with clients are centered around value, function and necessities – seems to be the case for property investors as well. In a market where house prices are stagnant and interest rates being at their lowest (and still dropping) – renovating for value to either position it to sell, or increase rent – and funding it through a home loan seems to be the opportunity investors are taking advantage in order to maximise return (and increase equity).
To be clear, not all renovations add value or produce equal return on spend. So allocating your spending in the right areas is important (with consideration of your location and needs of the demographic). Bathroom renovation and Kitchen Renovation is still both the most popular choice especially for an outdated home – they are seen as the core features of the home for buyers and gives the best impression of value.
However with that said, everyone’s situation is different – and we highly advise to talk to a project manager, finance specialists and local real estate agent, to make sure what you’re deciding to renovate is going to be financially benefits to your portfolio, applicable to the demographic in your location, and you’re investing the right renovations with correct specifications that align with rental properties (best bang for your buck).
If you would like to talk to a project manager, get in touch with Superior Renovations on 0800 199 888 or visit their website www.superiorrenovations.co.nz