① The renovation costs must no exceed 40% of the property value.
Once you realize the renovation costs exceed a 50% of the property value, you can then give up on that property as you need to consider your own financial profile and the period that you can get those renovation costs back.
② The renovations must be practical and functional.
There are some major places that must be fixed such as living and dining room, kitchen, toilet and bedrooms. It is advisable to change the brand new electrical wiring and plumbing system at the same time. Spending money to convert part of your living room into a bigger car porch to accommodate the cars may not be a good selling point to the prospective buyers. If you buying the second-hand property for personal use, you can then go ahead to do it whatever you like.
③ The amount of money spent on renovation must suit the neighborhood.
It makes a little sense to spend a RM 300k on a property that property market value is RM 500k. But, make sure there is no huge different between the neighborhood and yours one. This is because most prospective buyers will not appreciated the amount of money that you spend on renovations if the house does not suit the neighborhood post-renovation. You can renovate the exterior as simple as possible and focus on the renovation in interior, it may surprise the prospective buyers!
④ Don’t follow too much of your own taste or style in the house
Not all the people like your style, so don’t leave too much of your personal taste or style in the house. The renovations must be done in good taste that can accepted by as many people as possible. As such, you will be able to get back your cost of renovations by getting a higher price or rental.
⑤ The costs of renovations will depend on how long you plan to live in the house
If you plan to buy the old property for personal use, you can then spend as much as you can, as long as you love it. But, if you only plan to reside in the house for less than 5 years, it is advisable not to waste any money on major renovations. On the other hand, if you plan to buy the old property for investment use, it is advisable to renovation the property as simple as possible, as long as its safe and good looking. For example, flooring instead of carpeting and painting instead of wall paper as well as focus on the minor renovations.
⑥ The quality of paint work
Last but not least, the paint work is very important because its the face or “makeup” of the house. This is the immediate “value adder” to a property as it is the most visible. This principle same with the women who like to put on makeup to increase her confidence. In reverse, a heavy or bad makeup on a pretty women can make her look terrible.
Article By: wma.property