Many real agents are reporting notable increases in home renovation in their areas which they attribute to a number of key factors, including affordability during a weaker economy.
According to Adrienne von Ess, Area Specialist for Lew Geffen Sotheby’s International Realty in Kalk Bay, St James, Marina da Gama and Muizenberg, buyers are increasingly constrained by the stricter lending criteria of financial institutions as well as their own shrinking budgets and in order to buy in areas they would like to live, they often opt for older homes that need a little TLC.
“Another reason is the fact that existing home owners in sought-after areas appreciate the value of their properties and understand that it would be difficult to replace their current lifestyles should they sell up and move elsewhere so they upgrade rather than sell as the need arises.”
However, not all upgrades are equal and Lew Geffen, Chairman of Lew Geffen Sotheby’s International Realty cautions that in order to successfully renovate and capitalise on investment, it essential to do one’s homework.
“Home owners looking to upgrade must always establish the current values of their homes as well as the value of property in the area in order to avoid the most common and potentially costly pitfall – overcapitalisation.
Neighbourhoods generally have a ceiling value; a threshold buyers and tenants are willing to pay.”
Geffen advises that it’s also essential to investigate current trends and popular home features if you are renovating to add value to your home rather than to suit your own lifestyle needs. “The features most commonly at the top of prospective buyer’s wish lists country-wide are open plan living areas, lots of natural light and, increasingly, eco-friendly systems which save water and reduce the cost of energy.
“Older homes will always benefit from bathroom and kitchen upgrades as well as plastering and painting a face brick exterior and enlarging small windows in living areas.
“It is also usually worth adding a garage if you have the space but it must always be attached to or at least close to the house as security is a key factor these days.” He adds that the addition of a cottage or flatlet is also likely to add considerable value to your home as they are a source of rental income and cater to the growing popularity of dual. Von Ess cautions that common mistakes include building entertainment areas too far from the kitchen and poor flow with too many rooms and corridors. “Increasingly at the top of buyers’ priorities are convenience and open plan flow that creates light and airy communal living spaces within a home.
Geffen concludes: “With a little forethought, planning and research it’s possible to add substantial value to your property and realise a solid and secure return on your investment.”
