My reno

Hi team

most of you will know i have been on this forum for quite a few years now.

Bought and sold 3 houses and now i am embarking on my first larger scale renovation. I intend to keep you guys abreast of the entire process from go to wo. Good discipline for me and hope you enjoy the ride..

I also need some help because at the end of the day i am flying bling here to a certain extent

Details

Inner Melbourne North single fronted Victorian house. Been a rental for 7 years. We will now renovate, move in for a few years then sell.

Block 7.2w x 40L attached on side.

We keeping front two rooms and knocking down the rest.

Adding 2 small bathrooms, kitchen, dining, open plan lounge and upstairs parents retreat.

Pretty standard stuff.

Budget is tight - 200-230k...i dont need expensive finishings...

approx 70 sqm down and 30 sqm up...so 100 sqm in total

So here is my breakdown budget...preliminary...build to start in 1 month. I would love some feedback. Many of the items i have researched but some like plumbing etc ive plucked from thin air with a semi educated guess.

The costed items all include time, labour and cost of items

Item Budget
Kitchen incl appliances $15,000.00
Bathrooms $12,000.00
flooring boards mesinite 70sqm $7,500.00
windows and doors $11,000.00
heating and cooling $7,500.00
insulation $3,500.00
lighting $3,000.00
solar $4,000.00
water tank $2,000.00
cabinetry not incl kitchen $6,000.00
cladding $8,000.00
internal walls / cladding $5,000.00
staircase $2,000.00
demolition $5,000.00
new fences $5,000.00
stumps, frame, chippy $40,000.00
painting will do most $3,000.00
laundry $2,000.00
electrical $10,000.00
roofing and gutters $10,000.00
plumbing $10,000.00
skylights $2,000.00
curtains $3,000.00
bricklaying $4,000.00
architect/soil/engineer/building $16,000.00

Total $196,500.00


Feedback most appreciated otherwise wish me luck!

cheers
aussie
 
Hi team

most of you will know i have been on this forum for quite a few years now.

Bought and sold 3 houses and now i am embarking on my first larger scale renovation. I intend to keep you guys abreast of the entire process from go to wo. Good discipline for me and hope you enjoy the ride..

I also need some help because at the end of the day i am flying bling here to a certain extent

Details

Inner Melbourne North single fronted Victorian house. Been a rental for 7 years. We will now renovate, move in for a few years then sell.

Block 7.2w x 40L attached on side.

We keeping front two rooms and knocking down the rest.

Adding 2 small bathrooms, kitchen, dining, open plan lounge and upstairs parents retreat.

Pretty standard stuff.

Budget is tight - 200-230k...i dont need expensive finishings...

approx 70 sqm down and 30 sqm up...so 100 sqm in total

So here is my breakdown budget...preliminary...build to start in 1 month. I would love some feedback. Many of the items i have researched but some like plumbing etc ive plucked from thin air with a semi educated guess.

The costed items all include time, labour and cost of items

Item Budget
Kitchen incl appliances $15,000.00
Bathrooms $12,000.00
flooring boards mesinite 70sqm $7,500.00
windows and doors $11,000.00
heating and cooling $7,500.00
insulation $3,500.00
lighting $3,000.00
solar $4,000.00
water tank $2,000.00
cabinetry not incl kitchen $6,000.00
cladding $8,000.00
internal walls / cladding $5,000.00
staircase $2,000.00
demolition $5,000.00
new fences $5,000.00
stumps, frame, chippy $40,000.00
painting will do most $3,000.00
laundry $2,000.00
electrical $10,000.00
roofing and gutters $10,000.00
plumbing $10,000.00
skylights $2,000.00
curtains $3,000.00
bricklaying $4,000.00
architect/soil/engineer/building $16,000.00

Total $196,500.00


Feedback most appreciated otherwise wish me luck!

cheers
aussie

u going to be using a builder or attempting this yourself?
 
good question

i have a friend who is a builder who will be doing the reno for me but paid by the hour. He will also sign off it...

I will hoever be doing it owner builder style - so organising all the tradies, sourcing the materials etc

another bonus is that i can do this paying cash so im hoping for some discounts...
 
good question
another bonus is that i can do this paying cash so im hoping for some discounts...

Obviously depending on the detail of your circumstances but probably worth thinking about ensuring you capture the entire capital cost based to optimise your CGT liability...
 
Hi

We are going to live in it a few years so no capital gains my thinking...

yeah but i wouldn't be paying cash that's just me. for a 196K build - even if you did 50% cash that's pretty big.

just make sure they give you plumbing certificates, electrical certificates etc as you will need them to get signed off. As for your builder mate - i hope he signs off on it as his name would be on the permit and if circumstances changes - it would only be more complications. getting paid by the hour in my opinion is a rip off for large projects like these. you need to keep them under supervision as they could be taking time for smokos or to eat etc.

besides - tradies like plumbers, electricians and builders are all targeted by the ATO this year for promoting a cash environment. think abt all the taxpayers like us who contribute to the economy and the welfare system.
 
yep - i guess i cant avoid the intinial cgt....

i should have lived in it for 2 years then rented it our for 6 years....then it would have been exempt...

because i rented it from the start it seems this 7 years sticks...but the longer i live in it the less significant as a percentage it becomes...

there is a chance it will be our family home for the next 20 years...
 
yeah but i wouldn't be paying cash that's just me. for a 196K build - even if you did 50% cash that's pretty big.

just make sure they give you plumbing certificates, electrical certificates etc as you will need them to get signed off. As for your builder mate - i hope he signs off on it as his name would be on the permit and if circumstances changes - it would only be more complications. getting paid by the hour in my opinion is a rip off for large projects like these. you need to keep them under supervision as they could be taking time for smokos or to eat etc.

besides - tradies like plumbers, electricians and builders are all targeted by the ATO this year for promoting a cash environment. think abt all the taxpayers like us who contribute to the economy and the welfare system.

thanks advice

i intend to be on the build with him....his labourer. Plus the house it just around the corner from where i currently live..
 
Not wanting to steal the tread. Would it be worth getting a valuation now before you do the reno so you have a figure to calulate CGT.

Brian
 
good idea....the higher the better!

having said that im not sure it matters. the only thing that matters is the price i sell it for whever i sell it...

so if i bought it for 300...and sell it for 1 million....after 10 years then my capital gains is 700k

but if i spent 250k on a reno then my capital gains is only 450k...

but if i live in it for 7 years then this capital gains is halved to 225k....

if i live ther for 14 years then cap gains is 150k etc etc
 
Once again I'm not the one for the figures, but I would think the lower the val the better.

You purchase for $300000 and its now valued at say $500000 your capital gain is $200000 and as you have owned if for over 12 mths it would be less 50% = $100000 and you pay tax on this amount at your current tax bracket. Of course if you don't sell ...... pay no CGT.

So the greater your valuation is the more CGT you would pay. This is my very basic understanding on how CGT works.

How long have you set down to complete the reno.

Thanks
Brian
 
I would love some feedback.

Hi Aussie, Where's your contingency sum? Allow 5 - 10% for unforseen costs. Also I wondered why you would leave just 2 bedrooms? Would have thought you could have knocked it down and had a clean slate to design exactly to your needs? It's pretty much a total rebuild by the sound of it. Is 2k per sq m standard rates for building in your area? Seems pretty high to me for average finishes?

All the best, RS :)
 
Hi guys

I have asked my accountant for some clarification re tax..

@rockstar....she is a heritage house so need to keep facade...yes have a 15 pct contingency up my sleave.....wont kill it if it ends up 230k...

time limit 12 months....

@wylie - ok good point - will get some
 
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