Tag: maintenance

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Decorating 101 DIY Expert Tips RENO ADDICT

When not to DIY. And when it’s ok!

Stuart Tucker, Chief Customer Officer at hipages, talks about when to DIY and when you really need to hire a tradie.

As a nation, we are obsessed with renovating and research from hipages has found that Australians have been spending an approximate $70 billion each year on trades to complete jobs around the home. While we are all homebound, now is the perfect time to get onto those home maintenance items lingering on the to do list.

We understand that some homeowners may be weighing up what they should and shouldn’t get done around the home based on what they can reasonably manage themselves and jobs that would require a tradie’s expertise. Before you strap on a work belt and dust off your power tools, it’s important to know the limits of your capabilities. According to our research, Aussie homeowners spend $3.53 billion annually on hiring tradies to fix DIY gone awry.

My tip is to ask yourself the following questions before you tackle a DIY project:

  • Do I have the necessary tools and expertise? Always do your research upfront before you get started to ensure you have the right tools, materials or expertise required.
  • How risky is it? Projects involving plumbing, electrics or working at heights are risky. Aside from putting yourself in harm’s way, you may also cause costly damage to your home. Always assess the risk and err on the side of caution.
  • How much time and space will it take? Jobs like painting may seem like a great idea but consider how long the project will take from start to finish and the space required. If it’s going to cause an inconvenience, it’s best to delay till another time.

There are still a number of jobs both inside and outside the home that are great DIY projects.

Inside the home: Interior styling – consider what you don’t like about a room, or what isn’t ticking the boxes for you anymore. You can then look at simple, effective solutions to meet the functionality of the space or room. This could include bringing in new furniture or furnishings, like cushions and decorations, or changing up the room layout.

Outside the home: Gardening is something that can be tackled by a DIYer, from sprucing up existing garden beds or creating new and inviting spaces in your backyard. Though we may be spending more time indoors, it’s worth giving your outdoor area a makeover so you have an alternative space to relax in and enjoy.

With that said, there are a number of jobs that should never be DIY’d including plumbing, electrics and home extensions and renovations. A licensed professional should always be hired to complete these works:

Plumbing jobs Although simple plumbing jobs such as unclogging a drain or fixing a leaky tap can usually be tackled by an amateur handyman without any problems, larger repairs or installations should never be attempted without the help of a professional plumber.

Electrical jobs Electrical work should never be attempted without the help of a properly licensed electrician due to the high risks associated with DIY-ing electrical work. In fact, in some states you’re required to use a licensed tradie even to change your lightbulbs!

Home extensions and renovations When it comes to DIY projects, the onset of reality TV renovation shows has given people a false perception of the work involved and the potential for costly mistakes. Registered builders are well versed with the building process and understand how to keep a build on schedule with quality control in check, while maintaining safety standards.

Repairing property damage Property damage may range from clogged drains to leaky roofs and water damage, so when considering whether to tackle a job yourself or bring in a professional, you’ll need to look at the scale of the job, the risks involved, and what sort of time commitment would be required.

If you are looking to hire a tradie at this time, it is essential to follow the recommended advice of health authorities. This includes adhering to social distancing and limiting face-to-face contact. Utilising technology is the best way to do this, from quoting a job at the outset through to end of job payments.

Typically the quoting process would involve a tradie visiting your home so they’re able to see the space or job you want done. A great alternative is sharing photos or having a Facetime call with your tradie so they can virtually view the job and provide a quote before they arrive.

Technology can also aid with contactless payment at the end of a job, avoiding the need to handle cash on either end. The hipages platform allows you to make payments directly to your tradie at the completion of a job. Many tradies also have credit card payment facilities.

These are some simple ways that allow homeowners and tradies to continue getting jobs done around the home.

*Data according to LEK Research conducted in 2018

hipages provides a better, smarter way to connect tradies and consumers and get the job done well.

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Expert Tips RENO ADDICT

Procrastination: how to stop stalling household jobs

A housepainter stands on a ladder to paint the walls inside a residential home. rr

New research has found that Australian households have accumulated an astounding $40 billion worth of maintenance and repair works that have gone undone around the home over the past year. This reflects a total of 80 million repair and maintenance projects outstanding in Australian homes today.

A housepainter stands on a ladder to paint the walls inside a residential home. rr

The majority of these jobs are put off for six months or more, though time intensive jobs like painting are more likely to be put off for over a year. The research also found that jobs where a tradie would be required including concreting (2.3 million jobs), plastering (2.6 million jobs) and carpentry (3.3 million jobs), are likely to be put off for six months or more.

Whilst most of the nation procrastinates, with 92% of households saying that they have at least one outstanding project/job, Stuart Tucker, chief customer officer at hipages, who commissioned the research, says 2020 is the year for Aussies to stop delaying any longer.

“We know there are a variety of factors which delay us completing jobs around the home – whether it be lack of time, expertise or money. For the majority of repair and maintenance jobs though, the longer you leave them the worse they’ll get. This often results in a more costly job than it would have been in the first place,” says Stuart.

“If you can afford to, it’s best to manage maintenance and repairs as soon as possible with a licenced professional as this usually has the least expensive outcome.”

Worker sweeping leaves and sticks from a valley of a roof.

He shares the following advice for homeowners to help get onto their at-home to-do list:

Stop thinking and start doing! Everyone puts off home improvements but nothing feels better than getting the job done, in fact the research found that 53% of homeowners say they feel relieved and 50% say they feel happy when jobs are done. hipages is the smart, online tradie marketplace that can help you get it done, all from the palm of your hand.

Create a plan. Planning is key to a successful renovation! Write out a list of all the jobs that need to be done in priority order, marking which jobs you’ll need a tradie for. You can source the tradie you need on-demand using hipages. You’ll get up to three quotes from tradies in your local area, allowing you to choose a tradie that fits within your budget and timeframe.

Prioritise urgent jobs! When jobs are put off or ignored they can snowball into bigger tasks or have knock on effects. A small leak may result in significant water damage or a cleaning job could turn from an hour of work into a full day job. Always address the problems around the home that could result in further damage first. Then you can move onto other projects.

Know your role. 68% of homeowners say they have attempted but failed to complete repairs around the home themselves. It’s important to recognise what you may be able to accomplish yourself, and call in the professionals for anything that can’t be DIY’d, especially plumbing and electrical work.

Group jobs together. If you have a number of smaller jobs piling up on your to-do list, consider grouping the jobs by trade. Get an electrician to look at all lighting and fixture issues you may have at once or a plumber to get those jobs done in your bathroom, kitchen and laundry. Ensure you agree all the jobs upfront with your tradie as part of the quote, before the work commences. This could help avoid some additional costs.

—hipages provides a better, smarter way to connect tradies and consumers and get the job done well. 

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Expert Tips RENO ADDICT

Baz Du Bois on the real cost of home maintenance

The cost of maintaining a home should always be considered when buying a property, yet it’s often forgotten about. As a general rule of thumb, expect to spend around 6 to 8% of the value of your home on maintenance over a 10-year period for houses and half that for units (due to levies and body corporate funds). That’s around $30,000-to$40,000 for a home valued at $500,000, so it quickly adds up.

baz-du-bois-headshot

Comparing house to human years, the first few years of a home’s life are similar to a newborn baby. In the beginning, all they do is eat, sleep and have their nappy changed. Everything runs smoothly – there’s no leaking taps or electrical issues and everyone who lives in the home takes very special care of it to make sure it stays that way.

Two years on and your new home is not so new anymore. Like a toddler, it has a few bumps and bruises – the walls are chipped, the interior need a repaint, floor coverings get tired, tap washers need replacing  and then there’s the ongoing cost of white ant and pest control. Slowly, the home is starting to age and look a little worn.

Five years on, as your child starts their first day of school and gets a few coughs and colds so too does your home. Perhaps you called in a plumber to fix that persistent drip from a leaking tap in the bathroom, the dishwasher may have stopped working and the outside of your home needs a good scrub. The hot water system needs maintenance work, the eaves and gables require painting, a tree root has invaded the sewage pipes and if you haven’t already, the walls are well overdue for a repaint and carpet need to be replaced.

When your child starts high school, the maintenance costs really start to add up. It’s time for a new kitchen ($15,0000) and bathroom reno ($10,000). From when you purchased the home, until now that’s over $1,000 a year you need to save!

As your teenager hits puberty, so too does your home – in a big way! There’s problems with sewerage, the gutter needs replacing and just like your teenagers bedroom the floors are a mess and the termites have moved in. If the budget allows, you also consider extending the living space as your not-so-little baby becomes more independent and when your teenager learns to drive, suddenly you need more parking space. Then, after about 40 years, the roof needs to be looked at.

So, as you can see maintaining a home is a very costly exercise. The early years wont set you back too much but after you’ve been living in the property for a while it really starts to eat away at your budget. If you have a unit, there’s also strata levies to consider. On the positive, your home has probably increased in value and you’re ready for a kitchen revamp!

It’s also worth noting that just like we exercise to look after our bodies, there’s plenty you can do to look after the health and wellbeing of your home. Oiling the front door and replacing the anode in the hot water system will more or less double its life.

It also pays to be prepared because getting caught out with a maintenance issue that becomes an emergency problem will definitely cost extra dollars. And think about how you can cover some maintenance issues when planning an extension or renovation, so you don’t double up.

Little things that quickly add up and need to be considered when buying a home.

Read all Baz’s articles, read more about Baz or ask him a question.

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RENO ADDICT

When is a repair on a rental property an improvement as far as the ATO is concerned?

The Australian Taxation Office (ATO) has issued a number of warnings recently indicating that rental property owners should be careful when claiming deductions.

Common errors highlighted by the ATO include claiming rental deductions for properties not genuinely available for rent, incorrectly claiming deductions for properties only available for rent for part of the year, claiming costs as repairs when they should be depreciated as a capital improvement and claiming capital works incorrectly as plant and equipment.

DSC_4949 Brad Beer Profile

Navigating the rules relating to rental property deductions can be quite complex for owners, particularly when it comes to depreciation. It’s important that owners have a basic understanding of depreciation legislation and the terminology used to categorise the deductions which can be claimed within a property. This includes recognising the difference between repairs, maintenance and capital improvements.

To assist investors to avoid a tax headache and claim deductions correctly this financial year, here are some of the key depreciation terms and tips on how to avoid incorrect claims.

Capital works deductions versus plant and equipment depreciation

Deductions for capital works comprise of the structural elements of a building, including fixed and irremovable assets. Examples include the roof, walls, built in cupboards, clothes lines, windows, doors and even the driveway. Dependent on the property’s age, investors can generally claim capital works deductions at a rate of 2.5% per year.

If a residential property was constructed prior to 15 September 1987, there are restrictions which apply. However, investors who own older properties may still be entitled to capital works deductions for any renovations, including those completed by the previous owner.

Plant and equipment items on the other hand depreciate at a much faster rate. Examples include carpets, hot water systems, air-conditioning units, security systems, blinds and curtains. Determining the deductions for these items is not dependent on their age, rather their condition and quality. To calculate depreciation for plant and equipment, the effective life of each individual asset set by the ATO should be used.

It’s not uncommon for investors to self-assess depreciation deductions for plant and equipment items. However, by doing so they are putting themselves at risk of the following mistakes:

  • They can categorise plant and equipment assets as capital works deductions or vice versa. This mistake can result in plant and equipment assets being claimed at only 2.5% per year, rather than at their higher effective life rate. It can also lead to capital works items being claimed at higher rates than they should be, placing the investor at an increased risk of an ATO review of their claim and potentially resulting in them having to pay cash back.
  • They could incorrectly determine a plant and equipment asset’s effective life based on its condition. For example, they may believe a carpet only has a remaining effective life of two years. However, carpets are deemed as having an effective life of ten years in residential properties. Incorrectly determining an assets effective life could result in missed claims.

Repairs and maintenance versus capital improvements

Investors will face a scenario where work is required to ensure upkeep or repair damage done to their property. The work completed can inadvertently improve an item’s value beyond the original condition of an asset.

The ATO provides clear definitions to help investors to determine the difference between what is considered a repair, regular maintenance and what is defined as a capital improvement. A repair involves any work completed to fix damage or deterioration of a property. Examples include replacing part of a fence broken during a storm. Maintenance is considered work which will prevent damage or deterioration, for example having the carpet cleaned or oiling a deck.

The costs for repairs and maintenance can be claimed as a 100 per cent deduction in the same year of the expense. However, if an investor was to remove and replace the entire fence, carpet or build a new deck, this will fall into the category of capital improvements.

Capital improvements, or work which improves an asset beyond its original condition, must be depreciated and claimed as a capital works deduction or as depreciation.

How to avoid the risks

Investors can avoid many of the risks of claiming deductions incorrectly for their property by seeking the advice of a specialist quantity surveyor. They will complete a site inspection of the property to identify all of the plant and equipment assets found, take measurements and conduct research to find the correct capital works deductions available and outline deductions for plant and equipment assets based on their individual effective life. A tax depreciation schedule will outline these deductions for the property owner’s Accountant to process their claim.

A depreciation schedule provided by a specialist quantity surveyor will help to ensure the correct and maximum deductions are claimed and minimise risk for both an investor and their accountant.

–Bradley Beer (B. Con. Mgt, AAIQS, MRICS) is the Chief Executive Officer of BMT Tax Depreciation. Bradley joined BMT in 1998 and as such he has substantial knowledge about property investment supported by expertise in property depreciation and the construction industry.

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DIY RENO ADDICT

Claiming tax back on investment properties: the basics

Property investors often worry about ongoing repairs and maintenance costs, however these concerns can often be reduced by claiming back these costs when completing a tax return. Before claiming deductions, it is necessary for investors to understand the difference between claiming repairs, maintenance and capital improvements.

bmt reno addict

Repairs

The Australian Taxation Office (ATO) defines repairs as work completed to fix damage or deterioration of a property, for example replacing part of a damaged fence. A deduction cost paid to repair a rental property can be claimed as an immediate 100% deduction in the year the expense is incurred.

Maintenance

Maintenance is defined as work completed to prevent deterioration to a property, for example mowing the lawns. Costs for maintenance of a rental property can also be claimed as an immediate deduction in the year the expense is paid.

Capital improvements

Improving the condition or value of an item beyond its original state at the time of purchase is defined as a capital improvement. These are classified as either capital works deductions or plant and equipment and must be depreciated over time. Capital works deductions include renovations such as adding an internal wall and also include items which cannot easily be removed from the property. Plant and equipment items include removable items such as carpet and hot water systems.

– Bradley Beer is the managing director of BMT Tax Depreciation. A depreciation expert with over sixteen years experience in property depreciation and the construction industry.