Saturday, January 25, 2014

Mount Wilga House

2A Manor Road (Rosamond Street), Hornsby, NSW
[Previous post: Renovating for Profit ...Next post: ]
external image Mt-Wilga-1.jpg
external image 5044998b4.jpg
A Federation mansion and garden prominently sited in large grounds on the apex of a long ridge with commanding views
of the surrounding countryside, including across the valley to 'neighbouring' mansion Mount Errington.
Photograph of Mount Wilga under construction
Photograph of Mount Wilga under construction
Mount Wilga House
Mount Wilga House
 Mt Errington Hornsby
Mt Errington Hornsby

external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252001.jpg

An Outstanding late Federation Queen Anne Style mansion.
  • Impressive multi-level roof with highly decorated gables.
  • Unusual verandah detailing.
  • Generally in good condition. Many interior features of note.
  • Owned by Marcus Clark leading Sydney retailer of the time. (LEP).
  • Grounds: Remnant garden layout surrounding notable mansion. Mature period trees dated from Federation period. Of regional significance. (LEP).
external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252004.jpg


A Federation mansion constructed over the years 1913-1914, with face brick walls, complex steep pitched terracotta tiled roof, tall roughcast chimneys, shingled and half-timbered gables, sandstone veranda piers with simple scalloped timber valences. Unusual cylindrical polished granite colonettes support the timber veranda posts.
external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252009.jpg
The residence is a single storey with a basement and three-storey tower at the roof apex. Original casement windows include projecting bays with leadlight and sculpted sandstone sills. Original doors and other joinery remains. Much of the original interior survives. The residence is prominently sited in large grounds with a number of large trees and a stone gateway (LEP)
external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252008.jpg


In 1907, Sir Henry Marcus Clark, a renowned businessman purchased 212 acres of land on the Hornsby Plateau, reputed to be the highest point in the Sydney metropolitan area.
external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252012.jpg
  • Over a few years he designed and commenced building the manor house, on the land that is adjacent to where Mt Wilga Private Hospital is currently located. The land and house have heritage significance to the Hornsby Shire and both are listed as a National Trust Property.
  • Marcus Clarke named the property ‘Mount Wilga’ after the Wilga tree which was evergreen and could survive long periods of drought. He died in 1913, and didn’t live to see the finished house, which was completed by his wife, Georgina in 1914.
  • Mt Wilga Estate dates from an initial purchase in 1907 of 49 acres at Hornsby by Georgina Clark, wife of the successful Sydney Draper and Retailer, Henry Marcus Clark.
  • Additional purchases of 26.75 acres and 45 acres were made between 1907 and 1908.
  • In 1908 Clark built a 520 foot long suspension bridge over the deep gully which lies between Mt Wilga and Hornsby Railway Station to facilitate the arrival of guests to the property from Sydney.
  • Prior to Mt. Wilga, Clark had resided in 'Sefton Hall' in Marrickville Road, Dulwich Hill, which was named after a property in England.
  • Mt. Wilga was reputedly designed by the owner and planned along similar lines to his summer home 'Sefton Hall' at Mount Wilson in the Northern Blue Mountains. It was intended to be Marcus Clark's winter home. The original garden as planned by Clark reflected an aesthetic of defining the property boundary and main access route as well as concealing the house from direct view and then revealing the house at journey's end. A formal area of the garden was laid out to the north of the house and open paddocks and orchard to the west of the house. To the south and south east was a service area.external image 5044998b5.jpg
  • However, Clark died in 1913 during the construction of the large single storey Queen Anne style house. It was completed in 1914 by his widow, Georgina Clark. The Clark family resided at Mt Wilga until 1919.
  • Henry's son, Les Clark built a very similar house 'Dulcidene Homestead' in Dubbo.
  • In 1926 Mrs Georgina M Clark sold the house and a portion of its land to Miss Jessie Hamilton Scott of Hornsby who subdivided the land creating Manor Road. In 1928 the subdivision of Mt Wilga into 67 residential allotments was initiated. The large allotment containing Mt Wilga house remained in private hands until its sale in 1952 to the Commonwealth of Australia for use as a rehabilitation hospital.
  • In 1948 the property was owned by a Dr Smallpage. The Mt Wilga Rehabilitation Hospital operated between1952 and 1987. During the 35 year period the estate and house were altered to accommodate the functions and facilities of a rehabilitation hospital. Several large buildings were constructed on site.
  • In 1985 Howard Tanner & Associates (HT&A) prepared'"Mt Wilga, Hornsby NSW: Conservation Management Plan for the Administration Building' for the Commonwealth Dept. of Housing & Construction.
external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252007.jpg
In January, 1987, Howard Tanner wrote to the then Heritage & Conservation Branch advising of the impending sale of the property by the Commonwealth Government. In March, 1987, HT&A wrote to the Heritage & Conservation Branch making recommendations for a site curtilage based on historic and contemporary conditions.
external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252006.jpg
  • Concern over the future of the site led to the placement of a Permanent Conservation Order (PCO) #535 over the house and some of the curtilage on 4 September,1987. This is understood to have taken place prior to the sale of the property.
external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252009.jpg
In late 1987 (post PCO listing) Alpha Pacific purchased the site for use as a private rehabilitation hospital, and in July, 1988, sought to subdivide the site. The Heritage Council refused the application which sought to reduce the curtilage around Mt Wilga.
  • A modified proposal to subdivide the site into two large allotments was subsequently approved by the Heritage Council. Consequently, Lot 2 DP 792198 was sold in 1990 to the Japan-based Buddhist sect, the Nichiren Shoshu Sokagakkai Australia and run as a Buddhist Cultural Centre. The northern Lot 1 DP 792198 continued to operate as a private hospital.
external image 5044998b7.jpg


Some unsympathetic rear brick additions and infill of verandahs. Some sandstone painted.
  • 2007-8: 88 units with basement parking:
  • Repairs and maintenance work to preserve the fabric of the building, including the:
  • removal of glazing to the tower reinstate the lookout at the summit o the tower;
  • replication of stolen items from the house (using documentary evidence) will improve the presentation of the house and allow an understanding of its decoration. This replication will restore significance that has been lessened by the theft of joinery items and lighting fixtures.
  • reconstruction of the stone gate will ensure its survival, restore its significance, enable an understanding of is significance as part of Marcus Clark's pedestrian link to Hornsby across the gully, enhance its appearance and ensure public safety;
  • relaying original tiles on a new slab will prevent subsidence and protect the tiles from substrate collapse.; and - rebuilding the north-west corner of the front veranda will ensure the survival, while using the existing timber and stone elements (SHR).
external image Mount%2520Wilga%252003.jpg

Former Uses: residence, rehabilitation hospital, Buddhist cultural centre residence, rehabilitation hospital
external image 5044998b2.jpg


The original garden planned by Clark reflected an aesthetic of defining the property boundary and main access route as well as concealing the house from direct view and then revealing the house at journey's end. A formal area of the garden was laid out to the north of the house and open paddocks and orchard to the west of the house. To the south and south east was a service area. 
  • Despite subdivision and loss of land to the north and east, a generous area of garden surrounds the house to the east and south. This retains the core of the eastern garden, driveway and a good part of the former service area, including the tennis court, bowling green and site of the former chicken house.
  • Subdivision and redevelopment of the hospital to the north and west has greatly altered much of the estate's land there and encroaches fairly close to the carriage loop and western boundary of Mt.Wilga.
Period elements remaining on the site include border planting around the perimeter of the house.
external image Mount%2520Wilga%252004.jpg
  • A grand drive sweeps south-west from Manor Road leading up to a fine circular carriage drive in front (north) of the house (formerly gravel, now bitumen) with central planting plot and dominant Canary Island date palm (Phoenix canariensis) to 14m high. (This possibly dates from c1920s as it is not evident in a 1917 photograph).external image 5044998b3.jpg
  • The original long drive sandstone castellated gate arch structure no longer exists - it has been replaced with a modest brick pillar modern steel gates in the hospital era) but an eastern pedestrian entrance constructed of sandstone remains. This eastern entrance is covered by climbing fig (Ficus pumila var.pumila) and retains an intact wrought iron period gate.
external image Mount%2520Wilga%252007.jpg
Mt Wilga's grounds include large sloping lawn areas to the house's east and south, a tennis court to its east, a bowling green to its south-east and some shrubbery (seemingly reduced in quantity).
external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252002.jpg
  • Large mature trees including Bunya Bunya pine (Araucaria bidwillii), Port Jackson or rusty fig (Ficus rubiginosa) and Monterey pines (Pinus radiata) to 20 metres (probably from c1910) camphor laurels (Cinnammomum camphora) and brush box (Lophostemon confertus) to a 16m evergreen /southern magnolia / bull bay (Magnolia grandiflora) and crepe myrtle (Lagerstroemia indica).
  • Along the southern boundary there is a row of turpentine trees (Syncarpia glomulifera) to 15m high which have grown since the 1950s and, further to the south-west adjoining the former service driveway to the former garage, a Himalayan cedar (Cedrus deodara), book leaf cypress/arborvitae (Platycladus orientalis) and brush box trees (now outside the boundary to the west near the former service drive).external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252014.jpg
  • Also mature trees on site include two sweet gums (Liquidambar styraciflua), two frangipani (Plumeria rubra) flanking the front steps to the house, a rare Syzygium jambos tree on the eastern boundary near the entrance drive, an ironbark tree west of the house (Eucalyptus sp., possibly E.crebra), a NZ flax bush south of the drawing room (Phormium tenax) and a large Chinese wisteria (W.sinensis) on the wire mesh fence of the tennis court.
  • Younger tree plantings on the eastern lawn include tupelo or sour gum (Nyssa sylvatica), Camellia sasanqua, a mature Japanese maple (Acer palmatum) and native cheese tree (Glochidion ferdinandii).(Stuart Read, 9/3/2012).
external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252010.jpg
PCO Plan Number 535Image by: Heritage Council of NSWImage copyright owner: Heritage Council of NSW
PCO Plan Number 535Image by: Heritage Council of NSWImage copyright owner: Heritage Council of NSW


external image Mount%2520Wilga%252C%25202A%2520Manor%2520Road%252C%2520Hornsby%252015%2520floor%2520plan.jpg

Monday, January 20, 2014

Renovating for Profit

Are heritage homes good investments?

By Jessie Richardson Property Observer Monday, 20 January 2014

[Previous Post: Queen Anne or Federation Queen Anne? Next Post: ]

Here is a summary of four excellent articles for the Property Investor interested in Heritage Housing:
The illustrations are of Coombe Grange, a Queen Anne/Tudor Revival heritage-listed beauty in the Sutherland Shire of New South Wales.* Coombe Grange (pictured below) was listed in December with $5.95 million hopes.Last sold in 2006 at $4.85 million.* The house initially hit the headlines in the early 1990s when a mortgagee sale in 1991 secured $970,000.* The 2,637-square-metre Taloombi Street estate almost commands beachfront prices, albeit with freehold pathway access to Gunnamatta Bay.
52 Taloombi Street, Cronulla; The house was designed by architect Spencer Spasfield for Reginald and Florence Snelling who'd operated a Glebe printing business.Completed in stages, it comes with a ballroom that was added in 1925.
52 Taloombi Street, Cronulla; The house was designed by architect Spencer Spasfield for Reginald and Florence Snelling who'd operated a Glebe printing business.Completed in stages, it comes with a ballroom that was added in 1925.

1. Are heritage homes good investments?

"With unique charm and situated in prime locations, there’s a lot of appeal to owning a heritage property. But while the rarity of heritage residence ensures that they have long-term value on the market, the many restrictions on renovating, subdividing or altering them can leave many investors wondering whether they’re worth the hassle.
  • "If a property or site is deemed to be significant to the heritage of a local area, it may be protected under a heritage overlay, enforced by the local council.
    52 Taloombi Street, Cronulla
    52 Taloombi Street, Cronulla
  • While a property that is deemed a “heritage place” by the local council may not necessarily have strict restrictions on changes, a heritage overlay will require a permit to subdivide land, demolish or remove any part of a building, carry out construction (including building a fence), construct or display a sign, externally paint an unpainted surface or externally paint an advertisement onto a building.
  • Other controls over external painting, internal alterations and trees also may apply, depending on the individual property."

"Renovating For Profit founder Cherie Barber says that it’s vital to understand what kind of heritage protection the property in question falls under. She notes the distinction between a heritage listed property, and one that falls in a heritage and conservation precinct.
  • “One is individual, and one is blanket. Heritage and conservation applies to a whole suburb. The council is saying, ‘we’re going to be very particular about the development in the suburb. We want all the houses to retain the underlying fabric of the suburb.’ So they’re very particular about the exterior. Those properties usually don’t have any restrictions on what you can do internally.”
  • However, that doesn’t mean that a renovating a property in a heritage and conservation precinct is cheap. To obtain approval for changes to a property, the council often requires that renovators and investors produce reports from experts in heritage constructions.
  • Barber advises renovators in heritage suburbs to expect delays when trying to get paperwork approved through the council.
  • “The typical lead time in approvals is four to nine months in my suburb, and each report can be thousands of dollars.”
52 Taloombi Street, Cronulla
52 Taloombi Street, Cronulla

"While it may seem that heritage controls exist to preserve a building exactly as it originally stood, the Victorian Department of Transport, Planning and Local Infrastructure notes that 
  • “not every building or landscape element will be significant”, and that
  • making changes or removing “non-contributory” elements of heritage places is generally not an issue.
  • Such subjective terms make councils unpredictable, Barber says.
  • As such, she advises that only the serious investor or renovator should approach a heritage property.
  • “You’ve got to be savvy. You need a good team of professional experts around you. You have your trade team and your professional team – ‘the suits’– your town planner, your architect, your lawyer, your structural engineer. And when you’re working on a heritage property, you’re going to need the suits more than the trade team.”

"Wakelin Property Advisory founder Monique Sasson agrees.
  • “Normally they (houses) are extremely significant, seven figure properties.
  • There are two reasons you would buy one of those:
  1. as a loved and cherished family home, or
  2. as some kind of commercial enterprise, to have a heritage related business.”
    52 Taloombi Street, Cronulla
    52 Taloombi Street, Cronulla
  • “Either way, we’re talking about a very significant investment.”
  • “If you’ve got that kind of money, and you’re pretty set on holding on to the property for many years, then a heritage property can be great.”
  • “But if you’re buying it because it superficially looks good, stay away.”

"While owning a unique heritage property might seem appealing, Sasson warns that the task should only be approached by those with the budget, the knowledge, and the commitment.
  • “This is not a purchase for the average investor. This is for a specialised investor.”
  • “For the average mum and dad investor – don’t go near it.”

2. A DIY guide to renovating for profit:

Where to start with property renovations:
By Chris Gray PropertyObserver Friday, 04 November 2011

It’s easy enough to paint some bedrooms, sand the floorboards and call yourself a renovator. Anyone can slap paint on a wall, but knowing exactly what you need to do to improve a space and increase a property’s overall value requires expert knowledge, which many people do not have.
  • How do you know if the tiler you’ve chosen has quoted the right price? Will your bathroom and kitchen really take two weeks as promised – or will it drag out to two months? And should you always go with the cheapest quote?
  • As with all aspects of property buying and investing, renovations require careful planning and execution. Investors must bear in mind that the purpose of renovations is to maximise the property’s equity, so the profit is often in the decision-making, not necessarily in picking up the tools.
52 Taloombi Street, Cronulla
52 Taloombi Street, Cronulla

Why should I renovate?

Renovating your investment property can give you capital growth, even in a flat market. 
  • The instant profits that come from a renovation can be used to help fund any negative cash flow.
  • At the same time, undertaking careful upgrades will prevent maintenance for years to come, giving you a hassle-free, passive investment. So far, so good – but very few property owners know how to get these results without any stress.

If the renovations are carried out correctly and with the right advice, you can make tens of thousands of dollars in equity in the first year alone. It can be as simple as new paint and new carpet, or it can be as complex as a complete gut and refurbishment.

How much should I spend?

There’s no hard and fast rule on this but it’s always a good idea to engage an independent and impartial property valuer before commencing your renovation. 
52 Taloombi Street, Cronulla
52 Taloombi Street, Cronulla

  • You can easily become emotional when buying and renovating property, but when you become too emotionally involved, it usually leads you to overcapitalise because you get carried away and believe that the more you spend on the project, the higher its final value.
  • On the other hand, if you undercapitalise, potential tenants or prospective buyers are likely to obtain a discount on the property as it hasn’t been renovated to its true potential.

Many amateurs make renovation plans, believing that a $30,000 kitchen renovation will add $50,000 to the property’s value. A good valuer will know that homes in the street won’t sell above a certain value – even with a new kitchen – and the renovator would be lucky to add $30,000 value.
  • In this scenario, a valuer may suggest spending just $10,000 on simple improvements such as new cupboard doors, benchtops and flooring, which could add $20,000 to $30,000 to the equity, which is double or triple the investment.

Property valuers are best found through recommendations, internet searches or asking their industry body, the Australian Valuers Institute. I recommend you find a local valuer as they’ll know the prices in your area well, along with the type of demographics that would appeal to your particular property.

What can I do myself to keep costs down?

On much larger jobs you could pull in a quantity surveyor who can provide you with a list of what labour and materials cost on certain jobs. This will ensure you’re not overcharged. The quantity surveyor can also provide a depreciation report on the additions you have made to highlight all the deductions you can claim on your tax return.
52 Taloombi Street, Cronulla
52 Taloombi Street, Cronulla

  • You should also always go to tender and get a number of quotes, using the first quote to ensure that everyone is quoting “like for like” on a line-by-line basis. This is where many people get caught out.
  • Let’s say you’ve asked for three quotes to paint the front mailbox of your duplex. One quote includes priming, painting and weatherproofing. The next quote includes painting the letterbox and repair of the broken latch. The third quote includes painting and weatherproofing, with free paint touch ups to any scratches over the next 12 months.
  • Can you see how difficult it is to compare these three quotes, when they each outline different work?
  • You need to compare apples with apples, so make sure you detail the specifics of the job, and ask each supplier to supply (in writing) the guarantees they offer, such as a fixed price, penalties should the job go overtime, warranties on workmanship and so on.

Another approach is to look at a “fixed fee” versus “cost plus”. 
  • A fixed fee will cap what you pay, but may include a fat contingency for the builder for unforeseen problems.
  • “Cost plus” can work out cheaper if all goes to plan. If you do lots of jobs or you are completing a big project, you could always see if a builder will do a joint venture instead and work for a percentage of a profit after sale or revaluation.
52 Taloombi Street, Cronulla
52 Taloombi Street, Cronulla

Where do I start?

Start by choosing the right property, making sure it is an unemotional investment, as opposed to an emotional home purchase.

Are you looking to buy, renovate and sell, or buy, renovate and hold?
  • If you’re selling it’s imperative that there is an immediate and almost guaranteed profit in the deal.
  • If you’re looking to hold, you need to buy the right property that will continue to grow strongly forever. The renovation profit in a hold strategy is more about icing on the cake, maximising your rental return and ensuring you have minimal maintenance to do in the future.

Next, work out a rough time and cost budget. If you want to renovate for profit, every extra dollar you spend has to give you at least one to two dollars in added value. Be mindful of how long your renovation will take as every day costs you another 24 hours’ worth of repayment on the mortgage, with no rent coming in.

Consider adding a 20% to 25% contingency for unforeseen expenses that always seem to crop up once you strip off the tiles or wallpaper. It’s all about being prepared for the worst, so check your finances to see what funds you have available, if the renovation takes a turn for the worse.

3Cherie Barber's eight step renovation process (for profit)

By Jennifer Duke Property Observer Monday, 09 September 2013
external image about-cherie-pic-web1.jpgCherie Barber is a full-time professional renovator and highly sought after Australian public speaker. Born in an average working class family, Cherie grew up in Sydney’s Western Suburbs and was removed from school, against her will at the end of Year 10, in order to help her family make ends meet financially. At a young age, she learnt about business, self-discipline and the meaning of hard work, a lesson she attributes to her later success.

In 1991, aged 21, Cherie bought her first, low budget, unrenovated property and cosmetically flipped it for a profit shortly thereafter. In her twenties, she bought project number 2, a structural renovation which she renovated whilst residing in the property (a lesson she now advises not to do) while working full-time in marketing. In 2001, Cherie threw in her full-time marketing job, at the end of her first professional renovation to work on old houses. This saw her earn more money on the weekends renovating, than her full-time employment.

See more at:

Renovating is not always approached as a scientific process, however succesful renovator and director of Renovating for Profit, Cherie Barber, recently revealed that her success rides on a specific approach.Cherie Barber's 8 steps.jpg

  • At the recent Property Millionaires Tour at the Sofitel in Melbourne on Saturday, Barber said that her process wouldn't win her any design awards but it's about making money and ensuring the renovation undertaken is appropriate to the area.
  • She shared a brief run-through of her process in her presentation at the event, during which Property Observer was present.

1. Structure and strategy

  • The structure in which you purchase is crucial to ensuring you are taxed efficiently at the very end of the process. Should you purchase in a trust, SMSF or company structure?
  • Decide on the strategy upfront: Is it buy/renovate/hold, buy/renovate/sell or something else?

2. Suburb due diligence

  • Investors must know suburbs down to a street level. Pointing to her target suburb of Balmain, she explained that she knows where the negative and positive price pockets are, or where the prices change, and the reasons for this.
  • Ensure you're targeting the right type of suburb for the renovation you intend to undertake. Middle ring and outer areas tend to suit cosmetic renovaitons, while inner city areas tend to favour structural.

3. Pricing due diligence

  • The real estate agent's job is to make the vendor money, never forget this.
  • Ensure you are looking at true comparables - your suburb due diligence should assist you with this process.

4. Property due diligence

  • Ensure you're not purchasing a property with major defects you cannot rectify under your budget (think about the hidden problems, such as termite damage or bad wiring).
  • Check that the property stacks up for the majority of buyers in the area. Your demographic is crucial, and you should be thinking about a property as a product.
  • Calling council and a number of other local experts will save you money in the long run.

5. Acquire

52 Taloombi Street, Cronulla
52 Taloombi Street, Cronulla

  • The purchasing process and negotiation can be crucial for getting the price right. Ensure you enter in unemotionally and knowing the value (pricing due diligence).
  • There are a number of different conditions, requests for early access and similar that can be asked for at this part in the process.

6. Council approval (usually for structural renovations)

  • The earlier this part of the process is started the better. Investors should be prepared for councils to take longer than is often stated on their websites.
  • To get an idea of how long the process might take, check online and see what has already been approved and the time frames. Expect it to take longer.

7. Renovate

  • Get some good tradespeople and treat them well. It can often take a number of renovations to get your team selected.
  • Keep organised, keep timelines and ensure effective communication.- Avoid being the DIYer unless you have done it before effectively.
 The results: On September 5, 2013 we asked readers which room they thought would generate most value when renovated.
The results: On September 5, 2013 we asked readers which room they thought would generate most value when renovated.

8. Sell/Rent

  • While you should have been clear on which of these approaches you were going to take since step one, it's now important to ensure you approach the best real estate agents and property managers for the job.
  • Treat choosing agents as an interview process, rather than solely basing it on personality.
  • Ensure that at any opens, the changes you have made to that process are highly visible and communicated to potential tenants/purchasers.

4. Five mistakes to avoid when renovating for profit

Venessa Paech
Venessa Paech Australia's No.1 Property Site Australia's No.1 Property Site

by Venessa Paech 30 JAN 2013

Plenty of people have an appetite for doing a place up and selling for a profit. But there are common pitfalls that get us into trouble.
  • Remember that renovating strategically isn’t about painting a wall and calling it a day. It’s about a careful consideration of adding real value to a property in the market, and that takes some homework as well as sweat equity.
  • Smart renovating can lead to capital growth and well considered improvements can hedge against maintenance issues on a property you intend to keep a hold of and rent out.

1. Leading with the heart not the head

52 Taloombi Street, Cronulla
52 Taloombi Street, Cronulla

If you’re not buying your forever home, you really need to dial the emotion down. 
  • While you can indulge a little feeling – the type that lets you spot the potential of a renovation gem – don’t let the heart dominate the head.
  • If you intend to improve and move on, keep your eye on your objectives. Stay rational and let your research guide you, and while we’re on the subject of research… you can never do too much. Really.
  • Comprehensive research will help you avoid common mistakes, identify the right property projects, cost your renovations accurately, understand your target market and maximise your end profits.
  • Know where, what and why you’re buying, and be prepared to defend it with real data, not instincts or assumptions.

2. Paying too much for property

52 Taloombi Street, Cronulla
52 Taloombi Street, Cronulla

A mistake in any situation, but especially if you’re looking for a fixer upper that you hope to turn a profit on.
  • How much you buy your property for has a huge impact on what you will ultimately make from that property. No matter how exciting the deal seems, if you over spend, you’ll be forever trying to make that up in your renovating. This leads to ill advised cost cutting and can further crimp your success over time.
  • Watch out for the usual things that can lead to over spending, such as letting an auction bidding process run away from you, getting emotionally involved and develop and be confident in your negotiating skills. They’re as important as your skills in finding great suppliers or tradespeople to work on the property.
  • If you’re not sure, get some help or training.
  • Your negotiation skills are key – so work on them, or get some training

3. Over capitalisation

52 Taloombi Street, Cronulla
52 Taloombi Street, Cronulla

It can be deadly in any context, but it’s easy to let money get away from you when you’re renovating.
  • Blowing out your renovation budget can create serious cash flow issues and unhappy suppliers. You’ll lose motivation to finish the project, and people will be less inclined to work with you if they don’t think you’re handling things sensibly.
  • Enlist the help of a professional valuer and, if you have a big job ahead of you (such as renovating a block of flats), a surveyor. Knowing what the property if worth, where the opportunities are to increase value, and an estimate of costs and work involved will help you keep on track.
  • Locally based valuers are ideal as they’ll understand your likely target market well, and will know where your money will and won’t have a tangible impact on value.
  • Create a disciplined budget. Chris Gray recommends every dollar you spend deliver you ideally two dollars in added value.Watch the numbers like a hawk and make judicious decisions where you can to save the bottom line (don’t cut corners with things like safety though!)
  • It’s worth adding between 20% to 30% contingency for unforeseen expenses. That way you’ll stay on top of your finances, no matter the curve ball that comes at you.

4. Doing it yourself

52 Taloombi Street, Cronulla
52 Taloombi Street, Cronulla

Unless you’re a professional by trade, it’s usually not worth the risk of DIY when resale is your objective.
  • While it might seem cost efficient at first, it’ll quickly lead to budget pain if you don’t know what you’re doing. You don’t want things falling apart once your new tenant or owner has arrived. The pros can work fast and they know their business.
  • Using a specialist gives you certain guarantees. If there are issues down the track, you’ll have recourse because you used a professional, governed by professional bodies and grievance policies.
  • If you’re a truly experienced DIY-er you might be able to share the load.

5. Ignoring your audience

52 Taloombi Street, Cronulla
52 Taloombi Street, Cronulla

If you’re improving a property with profit in mind, it’s essential you think about where that profit will come from – that is, who’s going to buy it and what will appeal to them.
  • Your starting point should be neutral — and then tailor to those people most likely to buy the property, whether families, students, couples or retirees.
  • Don’t trust your own assumptions here. Even if you think you are, or understand, your target market, make sure you actually seek them out, research them, and understand their real tastes and needs. Advice from a professional designer or stager is often a great investment, and will help you win hearts and minds when your ideal buyer walks through the door.
  • It’s possible to renovate for profit, even when overall market conditions are flat or uncooperative.
  • But you need to keep focused on your end game and collaborate with a team of specialists who can offer trustworthy guidance.

5. Case Study: How to make $570k reno profit from scratch!

From: Your Investment Property Reno Guide
external image Cherie%2520Case%2520study%2520p1.jpg
external image Cherie%2520Case%2520study%2520p2.jpg
external image Cherie%2520Case%2520study%2520p3.jpg
external image Cherie%2520Case%2520study%2520p4.jpg

Also: at Your Investment Property Reno Guide
  • Cherie Barber explains her top no cash reno strategies.
  • She also shows us how, on a budget of just $35,000, it’s possible to add $60,000 to a property’s value in only 2½ weeks.
  • For those of you with big renovation dreams, take a look at how Cherie managed to make an astounding $570,000 profit on a major structural and cosmetic renovation in what was only her fourth ever reno project.