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Big decision.. should I add an ensuite and improve front of my IP with new decks

Discussion in 'Renovation & Home Improvement' started by Abooking, 9th Jul, 2015.

  1. Abooking

    Abooking Well-Known Member

    Joined:
    24th Jun, 2015
    Posts:
    52
    Location:
    nsw
    I have an I.P that I purchased 12 yrs ago and its based in a country town and has since more than doubled in value.

    Its a 3b/r 1 bath house in a good street close to town. Im trying to decide if I should proceed with paying an Architect fees to do a DA to add a new ensuite which would take up 1/2 of the existing sunroom. The estimated total cost would be 10 to 15k

    I actually tried to sell the house a few yrs ago and could not find a buyer. Perhaps the asking price was too high or maybe the front of the house is a bit ugly (plain) looking. I asked the architect to do some sketches to install new decking in front of the sunroom extending to the north side of existing veranda and add balustrading (vertical safety rails) around the deck with 4 new vertical poles and new roof over it all.

    I believe doing this would significantly improve the exterior of the house and add value in the long term. I have a long term outlook on keeping the house to fund my retirement and hoping that it rises more in capital value in the next 10 to 15 yrs.

    It will probably be another 10k to 15k to do the work on the front of the deck. Thus total costs 30k.

    The sales agent and architect are saying that if I did the work and then tried to sell I probably would not get my money back if I sold in the short term.

    If I have a long term view on the asset then spending 30k could see a higher return on my investment in many years to come surely??? Considering that I paid in the low 200k for the house and now getting $530 pw I feel that it makes sense to proceed with the DA and work. I am leveraged 40% based on current valuations and have recently refinanced pulling out $60k equity to do this work if I proceed.

    What are your opinions on this??

    many thanks
     
  2. Biz

    Biz Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,482
    Location:
    Sydney
    Have you got some images of the front of the house as it is?

    Personally I wouldn't add a deck if you plan on holding it long term. It's just more maintenance for no extra return. I have one IP with a deck and every few years it needs to be repainted. The wood starts to rot after a while too. I would never again buy IP with a deck let alone add one on at my cost.
     
    Kael likes this.