Cherie’s Hervey Bay renovation

Vicki and Mark have been living in their Hervey Bay home since they purchased it a year ago with the intention of fixing it up, living there for a couple of years and then selling up.

Currently a 3-bedroom, 1-bathroom home, they hoped to be able to turn it into a 5-bedroom, 2-bathroom home on a budget of $30,000 to $40,000 by utilising the downstairs sub-floor area. There’s a hitch however – the large basement area failed to meet the minimum height for a habitable room.

 

It’s a good lesson in buyer objections, bad layouts and the importance of due diligence when buying a property.

My renovation strategy was a complete, whole house make-over, internally and externally. While the renovation ultimately achieved an excellent profit, it could have been more, were it not for the essential remedial work we needed to do before we could start on cosmetic improvements. Spending $6000 removing asbestos swiped more than a third of our budget – for something the end buyer will never see.

 

The house had an “unusual” layout, which limited its renovation potential. It really did prove to be one of my toughest renovations. It consisted of a complete interior and exterior makeover, broken down into the following areas.

 

Bathroom 

Stripping out and putting in a new bathroom consumed a massive chunk of the budget and actually had me concerned we were overcapitalising, but the owners were keen to spend the extra money to get a contemporary bathroom. On top of $6000 to have the asbestos removed by professionals, there was an additional $7000 spent on the fit-out, most of it in labour costs. Removing a corner linen closet gave me more floor space to work with, so I was able rejig the layout to create a much more practical and streamlined space.

A new vanity, bath, toilet and tiles completed the job. Without a doubt, bathrooms sell, so at the end of the day, a $13,000 brand, spanking new bathroom is unlikely to lose money.

Kitchen 

The large 1950s kitchen actually had real retro appeal, with its colourful timber cupboards, rounded benchtop and exposed shelving, so I was happy to work with the bones of what was there. I removed the suspended shelves above the benchtop, ripped up the lino and added the SMEG retro fridge. Then it was just a matter of painting the cupboards, resurfacing the benchtop and installing a tiled splashback. Total cost was $885, including second-hand appliances picked up for a bargain $200.

 

Floors

The owners were highly motivated to save money by doing any DIY work they could. Hiring floorsanding equipment for around $400 and doing the sanding and polishing themselves saved around $2000 by my reckoning. It’s a dusty, messy job, but well worth the effort, when you see how those gleaming timber floors have come up.

painting

Then it was a case of good old “liquid gold” (paint in your language) for all the walls and timberwork, inside and out. It was a massive task, and all DIY, but as always, it made the single biggest difference to the property for very little outlay. The new exterior colour (Taubmans “Grey Marble”) now covers the ugly red brick and provides a unified colour scheme, dramatically improving the streetscape. Painting the basement in neutral tones has turned it from a cluttered rumpus room into a relaxing, multi-purpose space with direct access outdoors.

Creative landscaping

Lack of privacy was a real issue for the backyard so I spent around $2000 on planting a bamboo screen right across the rear fence. Then it was a simple matter of mowing the lawns, front and back, and adding a couple of garden beds. The front picket fence didn’t fit the style of house, but a quick trim of the picket tips with an electric saw fixed that problem. Now it’s a contemporary fence that suits the new exterior look. Inventive, huh.

All up, the renovation spend was $20,000, bringing home a post-valuation profit of $35,000. So even with the costly remedial work, it was a fantastic outcome for the owners.

 

 

 

FINANCIALS

Property Purchase Price:                               $271,000

Property Value (Before Renovation):            $270,000

Renovation Spend:                                         $19,973

Property Value (After Renovation)              $325,000

Gross Profit:                                                 $35,027

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