I’m sure that many of you would love nothing more than to purchase a duplex block and then design and build a couple of gorgeous homes. Am I right? It’s a dream for many but the cash factor often gets in the way which is why today’s story is particularly interesting. This gorgeous home (and the one beside it), was developed by Melbourne business coach and entrepreneur Emily Osmond, her fiancé Koden and their good friend Jake.
“Creating these two homes with a friend made this project extra rewarding. We could share the challenges and laughs along the way and now we are next door neighbours!” says Emily of the project that is in the Melbourne suburb of Bellfield and was designed to break away from the traditional townhouse mould, instead offering something light-filled, spacious and with architectural appeal.
Lounge room
The subdividable block was purchased in late 2018 and had a tiny, semi-detached, two-bedroom home on it. The trio set about seeking council approval and then going through the design and build process – all of which took several years. That Koden works in property finance and Jake is an electrician certainly wouldn’t have harmed proceedings!
“You hear bad stories and imagine lots of ways that a partnership could go pear-shaped. We think ours worked well because we shared the same vision, intention, and goals for the project,” says Emily who is planning to do it all over again, such was the success of the partnership.
Dining room
Emily in the kitchen
As for the home’s design, it’s lovely and light-filled courtesy of an extra wide entrance hall, double-height void, skylights, and open tread stairs. “From the outset, we wanted to create two contemporary, sophisticated, spacious and light-filled family homes that had a ‘wow’ factor. We also wanted to focus on a monochromatic palette, to feel timeless,” says Emily.
An open staircase contributes to the feeling of light and space
The home’s angular architectural structure is softened through styling where Emily has embraced softness and curves – think circular feature wall lights, pendants and mirrors. “I also included details such as powder blue Nood Co handcrafted concrete basins in the bathroom as I think you have to have some unexpected, statement pieces to create a memorable home,” says Emily.
That powder blue Nood Co basin looks lovely in the powder room
But after a multi-year build process and time spent living in the home, Emily has caught the developing bug. The trio has recently purchased a property in Ivanhoe with the intention of developing another two family homes. “We have absolutely loved designing and building these homes as beautiful, functional, quality and luxury places for others to live – so much so that we all want to do it again!”
It’s often been said that Australia has some of the highest property prices in the world and the global pandemic doesn’t seemed to have affected that. In fact, most Australian cities have seen price increases over the last 18 months with many Aussies returning from overseas to our relatively safe shores. And given the current market, Ray White chief economist Nerida Consibee began to wonder whether you could find better value buying a house in one of your favourite holiday destinations.
Purchasing issues aside (some countries won’t allow foreign ownership at all, but many will), Australian banks typically aren’t keen on providing finance to offshore purchases of residential property. But assuming you’ve got cash (ha!), just what sort of house does $1 million Australian dollars buy you overseas?
“It’s hard to compare pricing at a global level, particularly given within a capital city or country, there can be significant variance in properties available. On a square metre basis, Turkey is the cheapest country to buy in, while Switzerland and Luxembourg are the most expensive. But in the United Kingdom, cities like London would have precincts that are potentially far more expensive than Switzerland,” says Nerida.
Given the difficulty in comparing prices, Nerida decided to look at some well-known global spots to see what you could purchase, compared to what you would get for the same money in a comparable spot in Australia.
A one-bedroom apartment in a global city The Australian dollar is currently rather weak – $AU1 million will only get you around $US715,000, £525,000 or €610,000. And while that exchange rate isn’t fabulous it is still enough to get you a one-bedroom, one-bathroom apartment in New York, London or Paris.
Interestingly, this is similar to the median price for Australia’s most global city, Sydney, where $960,00 is the median value of an apartment. By contrast, a similar apartment in the Melbourne CBD is worth $460,000.
You could purchase this Sydney apartment for around $AU1 million
A family home in one of the world’s most liveable cities Every year The Economist releases a report on the world’s most liveable cities and Austin, Texas ranked highly this year. For $AU1 million, you can purchase a pretty nice house on a big block like the one pictured below. You can also buy a three-bedroom house in West End, one of Edinburgh’s best suburbs.
In Australia, the same sort of money would buy you a house in a nice, beachside suburb in Adelaide – the Aussie spot that was recently ranked our most liveable city. You could also get a house in Footscray in Melbourne’s up and coming inner west.
This Adelaide home is in walking distance from the beach – it’s in Henley Beach which has just hit the $1 million dollar median price point
A beachside getaway A beachside holiday home in Asia sounds rather lovely right now but you do need to look quite carefully at where you can buy – many Asian countries have strict conditions on foreign ownership. For example, Thailand will allow foreigners to own an apartment, but they are forbidden from owning freehold land. That said, AU$1 million would get you a luxury hillside villa in Thailand’s Phuket or something similar in Bali’s Canggu.
This Bali villa is currently listed for just over $AU1.1 million
The same money would get you into a beachside suburb in Australia, but you are unlikely to get a new luxury villa. For example, Pelican Waters on the Sunshine Coast recently hit that price point but you’re looking at something more akin to a beach shack.
A country mansion Rural Europe represents very good value for money if you have a penchant for historic buildings. For $600,000 you could purchase a historic stone manor in the Auvergne region of France – complete with its own tower!
Incredibly, you could purchase this rural French home for $600,000 Australian dollars
By contrast, the same money will get you into the inland parts of northern New South Wales where Mullumbimby currently has a median price of $988,000. Close to Melbourne, Macedon recently just hit the $1 million median mark too.
This house is located in Mullumbimby which has just hit the the million dollar median mark
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With Australian property prices some of the highest in the world, buying a house is increasingly out of reach for many people. And given it’s a tough ask for those in a relationship, the path to property ownership seems laden with obstacles for the single among us. “Starting a portfolio is never easy no matter who you are but as single women, we must be extra cautious, motivated and pragmatic when it comes to building a killer portfolio,” says Rebecca Jarrett-Dalton, the founder of mortgage brokerage company Two Red Shoes.
A veritable minefield, you may be struggling to even start, which is where Rebecca’s expert advice comes in. “You deserve your place in the world of property owners. These seven tips should help you get you into gear to start that portfolio and, soon enough, you’ll be popping the champagne in a brand new house!” says Rebecca.
Rebecca Jarrett-Dalton. Photo by Kirsten Flavell
Find an adviser that will you pay attention to you! Personally I find it a little depressing that women are still having to prove themselves in this realm, but Rebecca warns that old habits (or prejudices) die hard. “Sadly, many women mention that they are overlooked or ignored yet women are often the key financial decision-makers. And this is obviously even more so when they are single,” says Rebecca.
“If you suggest something and you’re told no, ask why. It is your right to ask questions because it is your investment! If an advisor gives you an answer that seems glib or dismissive, go somewhere else. You don’t have to deal with condescension,” says Rebecca. Look for an advisor that listens, takes your ideas on board and offers constructive criticism too.
Reduce unnecessary credit & spending When going for a loan, lenders will forensically examine your spending habits when summing up whether you’re a liability or not. Just recently I heard of one major bank that will deem a person irresponsible with money if they see Uber Eats on their bank statement (guilty as charged!).
“Lenders are looking at your spending habits when considering your affordability. Reducing your credit limits and repaying any unnecessary debt before you start makes you more attractive to a lender. Fixing your spending habits before you start a portfolio will improve your cashflow moving forward too,” says Rebecca.
Make decisions with your head (not heart) This can be a tough one for women — particularly as we’re prone to nesting and that in itself often imbues the purchase of a property with layers of emotion.
“Being a forward thinker is a necessity when starting a portfolio that is going to have long-term growth. Remember your own taste will likely change, and trends are as unsettled as the wind. While buying that cute cottage may make your heart sing, you need to think; will it attract the right tenant or any tenant at all? Will it suit your longer-term goals?” says Rebecca.
You should also try to avoid high-maintenance properties or ones with unique features in order to increase the property’s buyer appeal down the line. “Always opt for the future rather than what your heart desires now,” says Rebecca.
Buy the best you can afford Moving house is an expensive pursuit when you consider removalist fees and stamp duty (amongst many more hidden costs), so buying the best property you can afford helps to future-proof your purchase.
“The cost of changing over property is too much. You need to buy the place that you will be happy to live in for long enough to justify the costs of moving. Consider that moving is an exercise that costs upwards of $50,000 by the time you pay agents fees and the stamp duty again. Ensure the home you are about to buy is worth it,” says Rebecca.
Keep your budget in mind The cost of day to day living can be surprisingly high, when you factor in all of life’s expenses. But one of the worst things you can do is remain ignorant to your spending habits — if you’re across them, you can make sensible decisions and avoid panic.
“The ‘single tax’ is one to watch, given that the cost of utilities and rates is more or less the same for you alone as it is for a couple. This means you’re already under the pump from the beginning. Make life easier for yourself by working out your average spending and your net income. If there isn’t any surplus, you’ll know that you need to make some adjustments to the budget,” says Rebecca.
Build a safety net You’ve heard the cliche about putting something away for a rainy day? Well this is even more important if you’re single and only have yourself to fall back on. “Consider putting money away in your home loan if it has a redraw facility, or an offset account to save interest while you wait for financial disaster. Another great way to stay ahead is to pay a little onto your bills with each pay,” says Rebecca who explains that a good financial adviser should be able to help you manage this.
You don’t need the latest, greatest, shiny new thing “Need is a strong word. It is important to separate your needs and desires if you want to build capital,” says Rebecca whose own home is filled with hand me downs and old furniture.
“You may be surprised to hear that I don’t have a new lounge – it’s more than 20 years old but it’s fine because it still works perfectly. Although I might desire all-new furniture, my goal remains on the property. If your goal is focused on the right things, you won’t worry about the age of your lounge suite.”
With property prices still relatively sky-high, apartment living is becoming the new normal in many capital cities. And it’s a trend that cuts through demographics. Whether you’re an older downsizer or a first home buyer, it’s a style of living that is on the increase as people are increasingly drawn to the affordability, convenience and amenities an apartment provides. And what has been interesting to note is the way in which apartment design has become more sophisticated in response and Steller’s Laila development in Melbourne’s Carnegie, with its ‘flexible space’ option, is a great example of this.
The flexible space can be set up as a nursery
Designed to give home owners maximum flexibility, all of Laila’s one-bedroom apartments include a flexible space that allows purchasers to choose between incorporating a butler’s pantry, study or nursery into their floor plan. The clever design is an affordable way for purchasers to add value to their homes while adapting to their own individual requirements.
“Design expectations for off-the-plan developments continue to rise as buyers become savvier about their home and how it needs to function. This flexible space component opens up a world of possibilities for our Laila first home buyers, downsizers and expecting families,” says Steller’s project sales and marketing director James Cirelli.
The room can also be set up as a butler’s pantry
“Where traditionally one-bedrooms have been favoured by young single buyers and downsizers, Steller’s flexible space component now means that young couples and expectant families can enter the housing market with an affordable product that caters to current demands but also offers room to grow,” says James.
The office option
“Each multipurpose space can be fitted out with a desk forming an office space, act as a second kitchen to offer more space for entertaining, or it may suit as a nursery for young buyers that want to start a family,” says James.
Buyer’s advocate Greville Pabst from PropertyDuo helped facilitate the purchase of four out of five apartments from last night’s Block auctions. Here he shares his thoughts on the auction results and the 2018 series overall.
What a transformation we have seen at the Gatwick Hotel this past few months. The famous hotel used to be dilapidated with its beautiful internal art deco features hidden away but thanks to The Block contestants, the Gatwick Hotel is now the crown jewel of St Kilda. The expensive revitalisation is kick starting the revival of the area’s former cool, edgy but elegant self.
Greville Pabst inside The Gatwick
It really is a fairy tale ending, and I felt quite emotional and proud to facilitate handing the keys over to three independent buyers who bought four of the five apartments – one buyer purchasing the two magnificent penthouses for what him and I agree was a bargain.
I was able to obtain four of the five Block apartments (something that has never been done in the show’s history), because of my deep understanding that selling and buying property is all about making the perfect match between the vendor and buyer. On behalf of buyers, I source and buy property that ticks all boxes for them – their functional needs and blue-sky dreams. For vendors, I advise on how to get a property ready for auction day by prepping and marketing the property to the right demographic, as I do for The Block contestants each season.
For example, the St Kilda buyer is a smart investor who knows St Kilda has a high rental yield, but is a cool yet elegant person so the furnishings and finishes needed to meet expectations. This year we also saw original owners wanting to retain a piece of their past. My job is to know who will fall in love with a property and help them secure their dream.
The two sisters for whom I bought apartment number two (Courtney and Hans’) took ownership from their mother in 1999, who had owned the hotel for 46 years. They worked at the hotel from the age of 14. They’re such strong women and what they’ve done for the community is outstanding. I am honoured to have represented them. We agreed that they had to have an apartment that faced Fitzroy Street, where all the action is in St Kilda and the original street address of the Gatwick Hotel. This was the one that was the real Gatwick for them which is why they didn’t want the penthouses, because they’re new.
Greville inside the terrace designed by Hayden and Sara
Apartment one has the dream kitchen, a space that means there is no such thing as too many cooks in the kitchen. My client is in love with the large dining and living room and celebrated the purchase that will return exceptional capital growth.
And who doesn’t want to own not one but two penthouses. Congratulations to my buyer, those rare expansive terraces are going to host many fun and memorable moments and will always be extremely desirable and grow in value as the views are ‘unblockable’.
Defying the current market, contestant’s expectations were certainly exceeded. It’s great when we see everyone win. My buyers absolutely felt like winners too.
Greville is CEO and executive chairman of WBP Group and one of the buyer’s advocates on The Block. He is a regular commentator on Sky News and the daily papers such as Herald Sun, the AFR and The Australian, helping everyday Australians make better property decisions.
As many Australians enjoy the festive season and summer sun, the real estate market goes into hibernation. That is until the New Year, when the market starts to pick up again. If you are looking to put your home on the market in early 2018, there are a few things you can do to make sure your home stands out from the crowd and increase your chances of achieving a successful sale. Here are seven tips on how to prepare your home for a summer sale:
Garden is number one – When looking at a home during summer, many buyers will pay extra attention to the garden and outdoor areas, as this is where they will imagine themselves spending time during the summer. Make sure the garden is well maintained, green and lush, with no dead flowers or uncut grass. If possible, try and incorporate some shady areas in the backyard.
Credit: renoguide.comau
Inspection times – Running around and looking at houses when the sun is shining and the temperature is high, is not an ideal scenario for potential buyers. Try to schedule your inspection times earlier in the morning or later in the afternoon to avoid the heat during the middle of the day.
Inside retreat – The inside of your home should be a cool escape from the outdoor sun. Keep the air conditioning or ceiling fans on during inspection times, or open windows and doors to get a nice breeze flowing through the house.
Credit: Three Birds Renovation
Change up the colours – Remove heavy curtains, rugs and cushions in darker colours, and replace them with a brighter and lighter palette that is more suited to summer. These small things can give the home a completely new look that is more suited to summer and warmer temperatures.
Create an oasis – If you have a pool, this is the time to show it off by making sure it is well maintained and looks its absolute best. During summer, this is a great selling tool and you want it to appear as the perfect summer oasis.
Credit: Harrison Landscaping
Replace the old – Small things that are worth investing in include updating the mailbox, front door, fence and adding a fresh coat of paint to the exterior. This can work wonders for the front of the home, which is the buyer’s first impression. It’s important that the home has great street appeal and looks inviting.
Credit: Heartly Design
Outdoor dining – In Australia, we are lucky to be able to use outdoor areas the majority of the year, and during summer we really want to take advantage of our climate. Stage your alfresco or patio area with furniture to make it appear large and inviting. You want potential buyers to imagine themselves eating and entertaining in the space.
–Greville is executive chairman of WBP Group and one of the buyer’s advocates on The Block. He is a regular commentator on Sky News and the daily papers such as Herald Sun, the AFR and The Australian, helping everyday Australians make better property decisions.
Hosted by property expert Naomi Findlay, the upcoming 2017 National Home Staging Symposium hits Melbourne on July 8 and 9 with a wealth of information on offer for aspiring home stagers. And this year, two attendees will be eligible to win scholarships to advance their home staging careers too.
“The aim of the event is to explore, indulge and educate you about the world of home staging as it evolves and grows in Australia,” says Naomi. Attendees can expect to get the inside scoop on the Australian home staging scene and they’ll learn how to run an online business alongside a bricks and mortar one as well as how to build relationships with real estate agents and how to build a team of stylists and trades.
Naomi Findlay
“We’ll also teach you how to make money through establishing a large client base, how to create a work/life balance and how to implement insurance strategies to protect your career and business too,” says Naomi. Other practical considerations covered include knowing what trends to use and which to avoid, social media (which sites should you be using?) and how to establish your target market.
Last year’s event
And while the event is open to anybody, Naomi has a few specific people in mind that could benefit. “Property stylists or those with a passion to enter the industry should attend as you will have the opportunity to meet and network with new people who are on a similar journey. I think real estate agents and renovators would benefit also, especially if they’re looking to increase their knowledge of the home staging scene.”
And as if that wasn’t enough enticement, there’s also two scholarships up for grabs: “One lucky attendee will be given the opportunity to study the Art of Home Staging and Advanced Home Staging Courses with the International Institute of Home Staging (IIHS) as well as a six-month Shine membership with IIHS. The total prize is valued at over $2,400,” says Naomi. The other scholarship is a mentoring one and is worth $3,300. “The mentoring scholarship will provide the winner with the IIHS mentoring program for three months and a six-month Shine membership too,” says Naomi.
One of the hardest things to know when buying property is: what exactly is fair market price? Especially in hot markets like Melbourne and Sydney, where desperate buyers and cashed up investors fork out eye-watering sums for properties they probably wouldn’t have given a second glance five years ago.
Front of house – before
If you’re buying a property as a home, then maybe there’s a permissible margin for the, “I just love this” factor. But when you’re buying a property you plan to renovate and sell for a profit, there’s no room for emotion; it’s all about the facts and the figures.
And the key figures you need to be reasonably assured of in order to make that profit is:
What the property is going to sell for post-renovation
The price you need to buy that property for in order for the numbers to stack up.
So in a sense, you’re working backwards, with the forecast sale price as your starting point. And how do you predict that elusive figure? Research, my friend, and lots of it. It’s what I call “due diligence” in my renovation workshops.
How to do your ‘due diligence’ on your reno property
Front of house – after
There are many aspects to this due diligence, but essentially you’re studying market conditions in forensic detail in order to sift out the suburbs – and the types of properties in those suburbs – that offer the most profitable renovating prospects. For example, you need to establish pricing disparity between renovated and un-renovated versions of the same type of property. If you find there’s very little price difference between the nicely renovated terrace and the rundown one in the same street, then clearly you’re unlikely to turn a profit. Move on.
Become a property expert in your target suburb: best and worst streets, new developments, local infrastructure, council restrictions on what kind of renovations you can and can’t do, etc.
Study past and current market conditions to establish there’s been decent capital growth in that suburb, and that the growth is likely to continue. There’s usually a knock-on effect when a popular suburb gets too pricey; the ugly stepsister next door suddenly looks a whole lot more attractive.
These are just some of the pieces of the puzzle. Clearly, there’s a whole raft of issues and costs to weigh up when you’re talking about one of the biggest investments you’re likely to make. But whatever you do, don’t just trust your gut!
Pore over the figures, put in the research and get a really accurate handle on what properties are selling for in your target suburb – only then can you be reasonably confident of what that rough diamond is really worth.
With its roots in New York City, the converted warehouse has been a strong design trend for many years now but it’s recently taken on a new incarnation in Melbourne. From the Helio development in North Melbourne to Supply Co Richmond and Wills Place and Elm & Stone in the Docklands, designers are no longer converting old warehouses but are building purpose-built lofts from scratch instead.
Elm & Stone loft-style apartment
“Elm & Stone is one of the first genuine loft developments to be built in Melbourne and definitely a first for Docklands. We prototyped multiple variations of this design to deliver the height and space that you might find in a converted warehouse, whilst capitalising on the great design benefits, of secure, elevated, north facing, apartment living,” says David Allt-Graham, general manager of residential at MAB. There’s no doubt that lofts provide functional living zones, additional height and space and a grand sense of openness, adding to their appeal over regular apartments in dense urban environments.
Elm & Stone loft-style apartment
“Those seeking a sophisticated, inner-city pad will gravitate to Elm & Stone for its industrial-chic aesthetic and proximity to the city,” says David of the apartments that feature split levels. The flexible mezzanine space could be used as a living area, children’s play space, extra bedroom or studio.
The development showcases some great design features too including spacious balconies, with built-in planter boxes, so that residents can add to the building’s living façade. There are a plethora of great communal spaces too including a zen garden, pool and BBQ area, gym and library.
Elm & Stone exterior
“We’ve been working in the Docklands for nearly 20 years, and with major Australian businesses like NAB, Medibank and the ANZ relocating to the precinct, we’re seeing a trend of younger buyers seeking quality, contemporary, yet affordable accommodation options nearby. However, this cohort of buyers are definitely vocal in what they expect in a development – community, connection to nature and a sense of style is a must,” says David.
When preparing a home for sale, the right kitchen renovation can add enormous appeal and significant value. Potential home buyers form emotional connections to a property if they can visualise themselves living there – so how can you create a kitchen to capture their imagination?
A new report from the Housing Industry Association estimates that around 213,000 kitchens were installed in Australian homes in the last financial year.
While over-capitalisation is a risk for all home renovations, undercapitalisation can also compromise re-sale value. “When people walk into a house, they’re doing their sums,” explains Travis Dean, a director of Melbourne kitchen design, manufacturing and installation company, Cantilever Interiors. “If it needs a new kitchen or bathroom, they’re adding $20-to-$30,000 to the purchase price.”
Cantilever Interiors believes a kitchen should have the craftsmanship and visual appeal to take it through the decades – no matter the budget – yet the company is often asked to replace kitchens that are a mere five-to-ten years old.
So you can avoid making the same mistake, Cantilever Interiors has put together five tips to ensure maximum home buyer appeal.
1. Classic palette
A pared-back colour palette ensures timeless appeal. White, for example, gives a kitchen a minimalist and clean-lined look and can also makes a space look bigger. In short, it helps a kitchen to feel inviting, fresh, light and bright.
2. Materials matter
The choice of materials is essential to the quality and appeal of a kitchen. While materials should always reflect the value of the property, they don’t always require significant investment. Re-constituted stone benchtops or quality white laminate with ply edging are durable, stylish options for different budgets.
3. Craftsmanship is key
Homebuyers have an eye for quality. Cabinets must be millimetre perfect and refined design detailing, such as shadow lines, make a big impression on how well a kitchen does or doesn’t sit in a space. The design process is also important – off-the-shelf products don’t allow the customisation required to fit a kitchen perfectly into a space.
4. Clever components
Clever, space-saving kitchen components, such a swing-out pantry, corner cupboard storage systems and other organisation inserts, show the increasingly design-savvy buyer the thought and quality that’s been invested.
5. Open spaces
Shadow boxes (open display shelves) are a simple design element that allows the new homebuyer to express their own personal style. They can add a touch of warmth and contrast to a kitchen through placement of interchangeable potted herbs, utensils, ornaments, crockery or cook books for a pop of colour.
All too often we see investors contacting specialist quantity surveyors to organise a depreciation schedule after they have completed renovations to an investment property. In most instances this is too late for the investor to claim all of the deductions they are entitled to.
If a client mentions they are considering renovating their investment property, it is important to recommend they speak to their specialist quantity surveyor straight away. This is because there may be depreciation deductions available for any disposed assets or demolished building assets being removed during the renovation process.
Property investors scrap items within a property for several reasons. The most common reason is ‘not fit for purpose’ because of obsolescence, functional inadequacy or dated style.
Essentially, if an item is scrapped it is a loss to the owner. Legislation allows property investors to claim additional deductions over and above their normal depreciation claim for assets being removed from their property. The remaining depreciable value of any scrapped items can be claimed in the year these items are removed from the property.
To take advantage of deductions for scrapped assets, a depreciation schedule must be arranged both before and after the renovation takes place. This will allow the quantity surveyor to complete a site inspection of the property to value all of the items and to take photographic records of the assets contained within the property. This evidence and the pre-renovation schedule will substantiate an investor’s claims should the Australian Taxation Office complete an audit of their annual income tax assessment.
Once the renovation has been undertaken, the quantity surveyor will compile an itemised schedule which will detail the depreciation deductions available for the new plant and equipment and capital works deductions obtainable for the owner of property.
Any removed assets identified initially will show a left over un-deducted amount in the property depreciation schedule. This amount can be claimed immediately. The new assets can then be depreciated as normal based on their effective life.
Depreciation and renovation case study
Jonathan purchased a fifty year old, two bedroom house. After renting it out for two years he decided to renovate the property. In its pre-renovation condition the house contained carpet, blinds, an oven, a cook top, ceiling fans, a split system air conditioning unit, a hot water system and light shades.
Jonathan engaged a specialist quantity surveyor to complete a property depreciation schedule when he originally purchased the property two years ago. Upon hearing about the additional deductions available when renovating from his Accountant, Jonathan contacted a quantity surveyor before starting the renovation to find out more. After obtaining information and discussing the benefits, Jonathan found that he was able to use his existing schedule to work out the un-deducted value of the items which were to be removed during the renovation.
When the original property depreciation schedule was completed, a depreciation expert visited Jonathan’s house and conducted a full site inspection. During this inspection they took notes and photographs of all depreciable items. This original schedule included all of the items being removed from the property.
The table below outlines the extra deductions that became available to Jonathan during the renovation.
Jonathan claimed $9,073 in extra deductions that year in his personal tax return. After Jonathan completed the renovation he contacted the specialist quantity surveyor to update the property depreciation schedule. They inspected Jonathan’s property again, documenting all of the new additions.
The specialist quantity surveyor calculated the construction write-off allowance now available on Jonathan’s new extension. Some of the new additions included a new oven, carpet, air-conditioning, a hot water system and blinds.
In addition to the $9,073 claimed on the removed assets, Jonathan was able to claim $8,700 in depreciation deductions on the new items in the first year alone and $29,300 in the first five years. Jonathan was able to maximise the depreciation deductions on his investment property both prior to and after the renovation by taking the depreciation schedules to his Accountant to make his claim when he completed his annual income tax assessment.
Bradley Beer (B. Con. Mgt, AAIQS, MRICS, AVAA) is the Chief Executive Officer of BMT Tax Depreciation. Click here for more.
New floorboards, a neutral colour palette with pops of mustard yellow and wallpaper, and a clever use of space, has completely transformed a home-away-from-home in Melbourne’s inner south-east for a busy mum and her teenage daughter. “My daughter and I live here during the week for work and school/university. We have a family home in Olinda (in the Dandenong Ranges ) which we retreat to on weekends,” said Jo McComiskey, former creative director for House & Garden magazine and owner of The Bedspread Shop.
Before living room
After living room
“The home was previously owned by a lovely old lady who sadly needed care. It had been freshly painted white, which was great, however the soft green carpet had to go. The potential was there, as it was an empty shell once the floors were replaced. It was then a matter of style, a colour palette and clever storage ideas,” she said.
To date, Jo has spent around $10,000 on the cosmetic renovations, which she’s chipped away at for the past two years, starting with faux timber floorboards from Masters and a kitchen revamp. “The cabinetry was fine, it just needed tweaking so I replaced the green laminate benchtop with white Caesarstone and the stove top. We also removed all the little silver handles on the cabinets and replaced them with natural timber knobs (I didn’t want any cold metal and prefer the look of soft timber hardware).”
Before kitchen
After kitchen
After kitchen and living room
A coat of chalkboard paint transformed the side of the pantry into a handy message board, while the living room, Jo’s favourite space, was given a lift by changing the all-white colour palette. “Painting one wall in the living space a soft grey has made a huge difference; too much white can be vacuous and wallpaper adds softness and surprise. The wallpaper is from the Sanderson Home range,” says Jo.
“The plantation shutters really lifted the space. It instantly lost its tired look once they went in. I love the gallery wall which is still a work-in-progress, and the light from the large windows. I’ll eventually buy a daybed to position along the windows and little door to the balcony.
“I also made a huge square-panelled mirror for the living area which measures 180x120cm. I bought the backing, mirror squares etc from Bunnings – it weighs a tonne! It’s like a Pottery Barn style mirror that stands against the wall,” said Jo.
After entrance
After study
The Glen Iris ground floor apartment also had an unusual layout. Jo’s solution: turn the main bedroom into an entrance and study, and the dining room into the new main bedroom. “Everyone comes in the old main bedroom door through the driveway and garden, so it was odd having that as a bedroom. Plus my daughter was in her final years at school and needed a private study space (her bedroom is too small). We wallpapered the study too in a sweet floral as it’s so close to the garden,” says Jo.
Before dining room (now main bedroom)
After main bedroom
After main bedroom
After main bedroom
“In the main bedroom I installed floating Ikea storage as space is tight and there were no built ins, and wallpapered one wall in a Scandi style paper, again from Sanderson Home,” Jo said.
Now Jo’s daughter has finished high school, the bathroom is next on the reno hit list along with replacing the 80’s silver door handles. “Timber handles are hard to come buy, however I have a source (a friend) and I’m just waiting on him to change over his handles so he can pass the old ones on to me. If you are reading this Bill…I’m still waiting, I haven’t forgotten!” she jokes.
After hallway
And it seems Jo, who has now overhauled four homes, isn’t the only one in her street with the renovation bug – her neighbours have also been busy and have repaid her (well sort of) for her patience. “I love our little garden – I have done a lot of work planting, and for privacy have installed a sweet standing herb planter, a lemon tree, and an extended paved area for seating. The boys at the construction site next door were kind enough to ‘donate’ some pavers that matched my existing paving in the garden. How thoughtful after a year of 7am drilling, hammering, listening to Eddie Maguire and mountains of dust — it was the least they could do!”
While The Block baby boomers Dan and Carleen are currently frontrunners in the competition, it wasn’t always so. I’m sure many of you will remember the ‘I love the shit out of you’ candle for example?!? But after struggling in the beginning, the couple called in some third party independent advice in the form of Greville Pabst, executive chairman of Melbourne’s WBP Property. We caught up with Greville recently to discuss the couple’s journey on the show and his top tips for maximising a property’s value.
Dan and Greville
“As their real estate advisor, my key advice to Dan and Carleen was to add touches of Art Deco to their contemporary style apartment, instead of trying to completely replicate the style of that period. Although buyers will be attracted to the Art Deco style, they may not necessarily want a 1920’s-inspired pedestal hand basin in their bathroom,” says Greville.
Dan and Carleen’s master ensuite
Rather than a full-blown homage to the period, Greville suggested including smaller references instead. “I advised them to add light fittings or floor tiles, such as subway style designs, that reference the 1920’s and 1930’s. These modest touches allowed the couple to successfully combine the older Art Deco style with a current contemporary look.” He also advised the couple to keep the original cornices, timber work, skirting boards and doors instead of replacing them with modern, square-edged designs.
Dan and Carleen’s guest bedroom
“Dan and Carleen are experienced renovators, and I think initially it just came down to learning how to combine Art Deco with contemporary style throughout their apartment. For example, their guest bedroom with the olive green coloured walls. Although it was a colour reminiscent of that period, because it was quite dark, it actually closed the room and made it look smaller. When they painted it white, the space automatically looked larger and more open, and it will be more appealing to a wider audience come auction day,” says Greville.
Dan and Carleen’s winning kitchen
“Now Dan and Carleen have got their style completely down pat and have successfully continued with this theme throughout each space and they’ve been getting some great results at room reveals.”
Dan and Carleen’s lounge
Greville’s top three tips for maximising a property’s value
First impressions
1. “A property needs to create a wow factor as soon you set foot into that front door. And if your property has a front garden, then maybe consider investing in some landscaping. The property needs to be as attractive from the front as it is inside the home.”
2. Selecting the right agent
“Equally as important is finding the right salesperson, who has a clear understanding of the price and value of your property’s location. Someone who is skilled in negotiation can attract an extra $50,000 for a buyer. Buyers often overlook this aspect or select an agency over an agent.”
3. Presentation is paramount
“A property needs to look its best, which extends from the property’s appearance from the street, to how it is presented internally. A seller should remove as much clutter as possible, but also create personality so potential buyers can imagine themselves living in the space. This could be in the form of warmth, especially if it’s winter, by stoking the fire – or playing music and evoking senses through fresh flowers or freshly brewed coffee. It is these little things that present a property at its best and really sell it. A seller also needs to ensure they pick the right time of day for inspections to have the best sunlight shining through the property. If a seller successfully presents their property, it will increase their chances of selling it for more.”
Imagine purchasing a property with the view of adding a second storey extension for the water views or extending out the back, only to later find out the local planning laws didn’t allow it. Or approaching selling agents for the property you’ve spent months renovating, only to hear the alarming news that the estimated selling price will barely cover costs, yet alone bring the tidy profit you were banking on. They’re expensive shocks that can be avoided with proper due diligence and research. Here are five mistakes you never want to make.
1. Paying too much for the property
If you pay too much for a property to start with, you’ve thrown away the best chance you had to make a good profit. That $40,000 you overpaid will have to be clawed back somehow and it won’t be easy if you’re on a tight budget or the market plummets.
2. Ignoring a major buyer objection
A location on a busy main road, overhead power lines, right next door to an electricity substation or noisy school… they’re all “buyer objections.” And guess what? If you picked the property up for a bargain because other buyers didn’t want a bar of these turn-offs, you’ll be saddled with the same problem when you come to sell. No matter how gorgeous the renovation, the busy road will still be right out front.
3. Failing to detect a major defect
If you buy a house knowing it needs rewiring or a new roof, then you can factor in the repair costs. If you didn’t know about them, then it’s an unforeseen cost you’re going to have to wear and if the problem turns out to be major, that could run into tens of thousands of dollars. Before you can even begin the visible work that adds value, you’re going to have to spend a fortune on hidden but essential, remedial work. Always get the building report or pest and asbestos inspection done.
4. Incorrectly budgeting the renovation
In order to make money from renovating, you need to know upfront exactly how much you can spend on the renovation in order to make the profit you’re after and what the renovated property is likely to sell for, based on your market research. It’s a magic set of numbers that professional renovators and developers virtually carry in their head. A sure way to overcapitalise is to spend more on the property than it’s worth.
5. Choosing the wrong style of renovation for the area
A renovation you do in a suburb full of uni students is going to be quite different to the one you choose for a leafy family-orientated suburb. Different suburbs appeal to different demographics and you need to establish what demographic prevails in your suburb. This information is not hard to get. Doing a renovation that is completely out of step with the rest of the suburb will turn off buyers and may mean you’re spending money on things that don’t matter at the expense of ones that do. Do your research and make sure you tailor your renovation to your target market.
–Cherie Barber is the director of Renovating for Profit, a company that teaches everyday people how to buy and renovate properties for a profit.
A Victorian family has completely overhauled a brick veneer home, turning it into a luxury four-bedroom abode in nine months.
“The potential I saw was in the view. We look out over green rolling hills and see hot air balloons flying over the Yarra Valley. For me, that is priceless,” said owner Kelly Berghella who estimates the extensive renovation has doubled the Wonga Park home’s value. “People thought we were a bit crazy to take on such an ambitious renovation as owner builders. A lot of people questioned why we didn’t simply demolish the whole house.”
Original house
Demolition gets underway
The roof frame and half of the original home was torn down and demolished, while the remaining half was stripped back and walls repositioned. “A lower level garage and theatre room with bathroom was constructed, while continuing on the upper level, a new kitchen, family room, alfresco area and study were built. The whole house had new double glazed windows installed. Externally, all old existing brickwork was removed and the whole house was re-plastered, along with new floor coverings and cabinetry,” said Kelly.
Before
After
Kelly and her husband Claude, a concreter, completed all the demolition work, poured the concrete footings and slab and landscaped the acre block, painstakingly moving each boulder into place with a bobcat over two years. “I’ll be happy if I never hear a bob cat again!” said Kelly, who warns others considering such a big landscaping job that “an acre is expensive and time consuming to landscape, it’s like seven ‘normal sized’ backyards!”
Before
After
But the biggest challenge of all was project managing the build with a newborn, while sticking to a deadline and running a full-time business. “Don’t take on a job this big when you have to be out of your rental in nine months while becoming first-time parents. It’s very stressful!”
Before
After
The beautiful view
That said, Kelly, who has now renovated three homes with her husband, says perhaps stupidly, she would do it all again and her favourite part of the renovation is the new living space which they love to spend time in as a family. “Reconfiguring the floor plan to allow for an open kitchen and living area, really capitalises on the view,” said Kelly.
Before
After
As for advice for would-be renovators, Kelly says “use reliable trades which have come from trusted recommendations and get friendly with your bank manager!”
As soon as the calendar hits September you can feel the property market wake up from its winter hibernation. Welcome to spring, one of the most competitive times of year to list your property. Here are some tips on how to prepare your place at this hectic time and make your property stand out from the crowd.
Mark Foy
Advice for selling in spring
For the past few years I’ve been cautious about encouraging people to sell their property in spring. Why? Lots of people think this is the best time of year to sell, but actually a healthy buying market has less to do with the season and more to do with stock levels.
It may surprise you to learn that the number of buyers in the property market is fairly steady throughout the year. When there are fewer properties on the market, demand and prices go up, but if everyone thinks they should sell their property in spring, there’s a glut and results may not reflect the quality of the stock.
This spring is a little different to the past few. Interest rates are low and people aren’t selling at the rate they have in recent years, so the lack of stock means it’s a better spring than most to list your property. That being said, it’s still a competitive time to sell, so you’ll need to make sure your property is at its best.
Image courtesy of Belle Property
Preparation and presentation
You only get one chance to impress a buyer, so make it count. Milder weather means people are happy to spend a little more time outside looking at the exterior of the property, so pay attention to the condition of your home. The facade should be neat, well maintained and inviting.
If you have a garden, make sure it is tidy and well kept. If it’s too early in the season for flowers or lush greenery, consider hiring a landscape gardener to plant something that blossoms early.
I strongly encourage homeowners to engage a property stylist to neutralise the space and enhance its positive features. The more you can remove your personality from the place, the easier it is for buyers to overlay their vision for the property, which encourages better sales. If you have psychedelic walls, for example, paint them white. A good stylist will give your place the edge over comparable properties for sale, so it is well worth the money to hire one.
Image courtesy of Belle Property
Timing is everything
Every property has an optimum time for inspection, dependent on ambience. As the days become longer during springtime, the best time/s in terms of favourable natural light and comfortable temperature will change compared to winter. Identify the best time to show your property and schedule an inspection as soon as possible to ensure you secure that timeslot.
Because more sellers tend to list their properties at this time of year, it’s also a good idea to line up all the professionals you need to help you sell yours—your choice of real estate agent, property stylist and/or auctioneer—as early as possible. Keep an eye on demand for other services you may need, for example someone to make minor repairs, paint your property or landscape your garden, so you can engage the people you need when you need them.
Spring may be a traditionally competitive time of year to sell your property but with a bit of planning and knowledge about what’s going on in the market you can certainly edge out similar listings and use the season to your advantage. As I mentioned, this year stocks are lower than usual so it’s a good time to put your place on the market because the weather and the competition are less fierce.
There’s an art to selling a home and it doesn’t just involve finding the right real estate agent. A lust-worthy interior can have buyers lining up at the front door potentially adding tens-of-thousands of dollars to the sale price.
“We’re not just creating a look, we’re illustrating a lifestyle,” says property stylist Melissa Rice who launched The Hired Home after 14 years in the real estate industry. “More often than not, the first introduction a buyer has to the property is through the internet and if the photos are bland, with no furniture and no emotion, you will have less buyers there. People want to see colour and personality in a home because that’s how they want to live. Buyers don’t want to live in a white box.”
Having an on-trend, snap-worthy interior can add up to 30% to the value of the property and according to Melissa, it starts with a good declutter and refresh. “I think the biggest turn off is if the property doesn’t present well; the furniture is tired, the home is messy and dark. People want light and airy and bright,” she said.
“It’s so important to present the home to its full potential, not only in the look but the floor plan. If it’s a small bedroom apartment we will try to fit in a study nook and things like that, so everything is addressed.”
Melissa recommends sellers update light fittings, install new carpet and apply a fresh coat of paint before the home is listed. “When someone is living in a property it doesn’t matter how clean and tidy they are, it just gets tired. Even light switch covers; over time they start to discolour.”
The same rule applies when styling. “Once you start using a product it doesn’t look fresh and clean anymore,” said Melissa who recommends investing in new towels, curtains, white linen and accent cushions to really lift the home.
“In bedrooms I tell people they must pull the furniture off the walls. A lot of times people believe pushing beds to the corner of a room is going to make it feel bigger, it’s not. For shelving, we would probably style about 60% of the shelf, leaving space for the eye to rest. Not every space has to have something on it.”
Renovating your home can be a stressful and strenuous undertaking at the best of times. When you’re renovating with the sole purpose of increasing the value of your home, there are certain factors that you should take into account before putting hammer to nail.
Greville Pabst
If you plan on renovating before selling your house, then consider making smaller but visually impactful changes to the property. Cosmetic updates such as a fresh coat of paint on walls and doors, upgrading light fixtures or redoing the flooring can add significant value to the property without breaking the bank.
A bathroom or kitchen that feels outdated can be very off-putting to prospective buyers. Kitchen and bathroom renovations can transform a house from an average property to the perfect family home for prospective buyers.
The kitchen is a place of gathering, where families can congregate and spend a lot of their time together. This is what makes them so integral to the living space. When renovating your kitchen consider installing a new oven, cooktop, kitchen bench or a butler’s pantry as a great way to up the value and liveability to your home.
Savvy buyers are also paying more attention to the orientation of a kitchen and how well it flows into living areas. Extending your kitchen into an open living space may be a larger project (and certainly a more time consuming task), but it will also add greater value to your home.
Another way to increase the value of your property without completing a full scale renovation is to update the bathroom. Having sleek modern bathrooms with newly installed showers, baths, benchtop, tiles and basins will improve the overall feel of the house, and can make an impact on its eventual resale price.
Small details can make a big impact, including new floor tiles or even installing a new or larger mirror to make a space appear larger.
–Greville Pabst is the Executive Chairman of WBP Property Group and will be once again appearing on the new series of The Block.
Front of house – after
