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Renovation spend - rule of thumb

Discussion in 'Renovation & Home Improvement' started by neK, 23rd Aug, 2016.

  1. neK

    neK Well-Known Member

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    What are other people's rule of thumb when it comes to renovating?

    I have an older 3 bedroom property (about 90 sqm) which could probably do with a renovation - its too bad, but it's not great either. The rent is pretty poor (the 2 bedroom granny flat next door rents out for more!)

    Renovation ideas
    • Gutting the bathroom and redoing it - its the original bathroom with pink tiles that are falling off.
    • Repaint internal
    • Repaint windows (paint is coming off and its showing rusty bits)
    • Remove old quality wood cupboards (but these really have a bad musty smell that won't go away) and replace with something more modern.
    • Gut laundry and replace tub and put in more storage
    • Remove old brickfire place (it's got no style)
    • Repolish floorboards
    • Change hotwater system - it's currently a tiny electric instant. It's really weak that it cannot support more than one application at a time - ie you cannot shower and wash dishes.
    • Replace rangehood and duct it out (13 years old)
    • Kitchen itself is ok, its 13 years old, but still functional
    I think this will cost around $20k+.... is it too much?

    Rent increase would be around $100 per week. For some reason this area of Sydney just isn't fetching as much rent when compared to areas that are further out west like Blacktown.
     
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  2. EN710

    EN710 Well-Known Member

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    No pic?

    From the sound of additional $100 per week, $20K doesn't sound too much.
    Does the laundry need full gutting? Can you just remove the tub?
     
  3. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    Rough rule of thumb on renos is to spend no more than 10-15% of the purchase price (or current value) for a 20-30% uplift in end value (ie $1 spend for a $2 min return).
    Also spending $20K on a reno (even at 5% IRs for a loan is only $20pw interest) to get $100pw extra rent is a good ROI.
     
  4. willair

    willair Well-Known Member Premium Member

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    Maybe set a time-frame per hour per work area,because if you intend to do it yourself then there will be a bit of labour time in something like this ,materials wise you would do something like this for under 20k.imho..
     
  5. neK

    neK Well-Known Member

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    @willair - I have no intention to do the work (ok i might do a few minor things that a regular person is capable of)

    Main thing I will do is design, supply fittings and co-ordinate the trades.

    • Bathroom - $10,000
    • Repaint internal - $1,000 (I have a guy that does a mediocre job - he can't cut for crap, so ill re-do that part. I'll probably also silicon any gaps beforehand between wall and cornices).
    • Repaint windows - ????
    • Cupboard upgrade - $2,000
    • Gut laundry and replace tub and put in more storage - $500
    • Remove old brickfire place (it's got no style) - ???
    • Repolish floorboards - $1800
    • Change hotwater system - (AGL is $125 for line install, $1000 for hotwater unit, $1000 for refitting plumbing)
    • Replace rangehood and duct it out (13 years old) - $300 for rangehood, $200 for ducting out
    • New blinds - $1000 (supply only - I'll do the install)
    $18,425 (excluding the ???)

    Possible you reckon? Or am i dreaming?

    @EN710 - No pics. Place is tenanted. I need to get in to measure and design. It's a concrete house, so no cavities, so it is going a little more painful. Laundry could do with a repaint and tiling on the floor - it hasn't been touched for close to 50 years i reckon (other than repaint 10 years ago).

    @Propertunity - Thanks for the feedback. If I do manage to keep the reno at $20k, then it would be closer to 2% :) That said, I do have intention knock EVERYTHING down and rebuild higher density within the next 5-15 years. So i do want to fix it up, but keep the cost minimal.
     
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  6. Tonibell

    Tonibell Well-Known Member

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    We have done a reno on every IP we have purchased - this reflects that we buy rundown places like the one @neK has. Always been happy to do the reno to get the extra rent, improved valuation and better tenants.

    The $20K spend sounds well worth doing if you are planning to keep it at least 5 years.
     
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  7. willair

    willair Well-Known Member Premium Member

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    If you were to leave the fireplace as it is then the way that is priced up it would be possible to go under the 20k,sometimes just new carpet tiles and paint goes a long way..
     
  8. EN710

    EN710 Well-Known Member

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    Either way, I'd spend the $500 if that's all you need to make it a lot better.

    Can you smash that fireplace yourself, then get someone to flush the wall or something?
     
  9. neK

    neK Well-Known Member

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    No time. Family time is more important :)
    And I'd probably smash in such a way that would cause more damage (to myself and the house!).
     
  10. neK

    neK Well-Known Member

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    Agreed, but that bathroom is in dire need of a reno.
    Everything in there is basically being held up by liquid nails :p
     
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  11. WattleIdo

    WattleIdo renovating Premium Member

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    Just 1K for painter? The paint itself will cost that much :p. If you can cut-in, why don't you do the lot and get the whole family involved? :eek:
    Floor polish for 1.8K. That'sa good price. I paid double that both times.
     
  12. Azazel

    Azazel Well-Known Member

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    That's really cheap, even for a mediocre job.
    Some places give a quote for an in between tenants paint or more for a better job if you want to live there.
     
  13. Perthguy

    Perthguy Well-Known Member

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    That depends on who the painter charges for the paint ;)
     
  14. neK

    neK Well-Known Member

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    Sorry, good pick up @Azazel @WattleIdo . I'm supplying the paint. So that cost needs to be added on.
     
  15. neK

    neK Well-Known Member

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    Family is too lazy :(
    As for the floor polish this is the same guy that polished my floor at my other place 3 years ago. I can flick you details if you want :)
     
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  16. Azazel

    Azazel Well-Known Member

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    Still sounds pretty good.
    Especially if you find some good deals on the paint.
     
  17. Perthguy

    Perthguy Well-Known Member

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    Masters 50% off :)
     
  18. Gingin

    Gingin Well-Known Member

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    Nek ..... in knee deep in it at the minute. Building a granny flat. ( owner builder) And replacing kitchen , bathroom in main house. Will rent both out later.

    Upgrading main switch board , gas and sewer.... So much pain ! Coupled with a full time job and two kids under 5! I've got 3 months of torture ahead!

    In the main house was just going to gut the bathroom and replace. Decided to rejig and add a shower.

    Things and scope have a way of sneaking up on you in major Renos. Best rule is plan for the worst financially and hope for the best. If worst case works out, it's a go.

    Now I've replaced all the terracotta drainage, removed asbestos bought a new window to install.

    Then decided to rip out kitchen and install custom one.

    Things add up. The reason I'm doing it this way is life cost of the Reno.I won't have to do anything there for twenty years hopefully. Maintenance and quality of tenant will improve.
     
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  19. Azazel

    Azazel Well-Known Member

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    I'm slowly helping my Dad with a granny flat conversion too.
    Good fun, and learning some stuff.
    Can be done fairly cheaply if you're doing it yourself.
     
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  20. neK

    neK Well-Known Member

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    Question on toilets... How much should I spend?
    Get a cheapy vizini from renovation kingdom or spend $400-$500 on a caroma or recognized brand from bunnings (will also check out masters fire sale).

    But what is the difference between those $100 to $500 to $1000 units? Are they worth the extra?