Patrick talks to Tim Webster on 2UE about his latest book The Insider's Guide to Renovating for Profit as well as the risk renovators face of overcapitalising on their property.
Beware the profit killers – In this edited book extract, experienced investor Patrick Bright shares his tips for finding, buying and renovating residential properties for a quick windfall.
Renovating residential investment property is a great way of building wealth quickly. It’s a relatively low risk strategy if executed correctly and will allow you to manufacture capital value and increase rental returns without relying solely on market conditions.
Buyers agents tell us that they are getting enquiries from buyers motivated by the recent spate of TV Renovation Shows. Unfortunately they have an unrealistic view about renovating and making a profit. We get a good grounded view from two buyers agents who tell it as it is. Click here to listen to interview.
For “The Block” enthusiasts, Sunday night’s finale was a flop with only one of the four properties selling under the hammer. Instead of popping bottles of champagne contestants were crying on each other’s shoulders. The program highlighted some important points and plenty of warnings that would be renovators should pay attention to as it goes to show that renovating and making a profit is not easy to do, even with significant resources and support.
This week on the Channel Ten show called The Renovators (episode 3) we saw two teams battle it out to renovate a terrace each – but they only had a 12 hour day to do it! The challenge was designed to see which team could add more value to their property based on ‘before’ and ‘after’ valuations. We saw skilled renovators hard at it all day investing in new kitchens, renovating the bathrooms, painting in and out, installing plants, putting up back yard fences, landscaping…. you get the idea it was a complete makeover.
Now is certainly a good time to add value to your property, particularly for investors who are looking to manufacture equity and increase their rental returns allowing them to add to their property portfolio sooner rather than later.
If you’re going to renovate then the first decision to be made is if you are going to manage this process yourself or engage a project manager. If you decide to go it alone rather than hiring an experienced project manager then you need to make sure you’re prepared. Here are a few tips to make sure you start the project with a realistic outlook:
Every year Australians have at least a few months of sweltering conditions that make them seriously consider moving to a colder climate or at the very least installing air-conditioning! There’s no doubt that an air-conditioned investment property will be particularly attractive to the rental market especially in the hotter months. So how do the numbers stack up?
