To renovate or not to renovate, that is the question

Hi all,

I've got a property in Albury/Wodonga with a serious case of ugly kitchen and bathroom (although still functional). I bought it for $180,000 (about 12 months ago), did a cosmetic reno (removed some wallpaper, repainted, gave the garden an overhaul) and it was then revalued at $190,000.

It has been rented for the last 12 months at $270 per week, but the tenants are now moving on to be closer to family. The property is on the rental market again, the first open house is this coming Wednesday. The real estate agent has said that many of the prospective tenants who came through the first time the property was rented commented negatively on the kitchen and bathroom.

This time around I asked the agent how much more rent we could ask for if I redid the kitchen and bathroom and she thought we may get $290 per week.

Here is the link to the property which contains a couple of pictures of the kitchen, but unfortunately none of the bathroom. Just picture LOTS of yellow, old shower screen, cracked lino.
http://www.realestate.com.au/property-house-nsw-lavington-408620735

If I was to redo the kitchen and bathroom I was thinking of the following:
  • Contact builder to see how we can knock out those hideous arches in the kitchen area to open it right up - on that note, can anyone comment on how easy it would be by looking at the images?
  • Remove hideous floral wall paper from remainder of kitchen - I did remove the same wallpaper from the other side of the arch in the kitchen area the last time around but then ran out of time
  • Perhaps new kitchen cupboard doors
  • Perhaps replace kitchen lino with tiles - although the lino is relatively neutral and in good condition in here
  • Retile bathroom - lino is yellowing and cracked
  • Respray yellow bathtub white
  • replace cracked and yellowing shower screen
  • Repaint in kitchen and bathroom

My question is do you think it would be worth it in this area and for this house?
 
Normally I just rip the kitchen out and start over as its faster and usually cheaper. That being said, unless the door edges are split, you could probably just get away with painting them as it wouldnt take a huge amount of time. And remove wallpaper and install good kitchen lighting which will make it much more appealing.

Apart from bath room which I cant see, I would put in new curtains (block out eyelet style) and thats about it.
 
I wouldn't do a new kitchen or bathroom for a lousy $20 extra per week (and most certainly not BOTH) :eek:.

I'd leave it as it is.
 
Is that a kitchen or a hearth? It looks like a solid brick hearth to me, you'd have to check that this is non-load bearing and rip it out to put in anything remotely nice.

Back to your question, when you had it revalued, what were the land and the building valued at? If the valuer did his job well, you would be able to see how much value is left in the building.

The comparison would go roughly
(value now) / rent now
against
(value now + cost of reno )/ rent after reno
against
cost of new build / rent of new build
 
The real estate agent has said that many of the prospective tenants who came through the first time the property was rented commented negatively on the kitchen and bathroom.
How long did it take to rent out 12mnths ago?

Going by the pictures,the kitchen is fine as is.
Can't comment on the bathroom as no photo but going by your list,it seems you can spruce up the bathroom on the cheap.
Cheers Spades.
 
Like the others have said, I would not be doing anything too much for a $20 possible rent increase.

I'd like to suggest that White Knight is your friend on this one:
1. Paint cupboard doors with white knight laminate paint.
2. Replace the door handles with stainless stell ones from Bunnings.
3. Paint yellow bathtub with white knight Tub & Tile.
4. Replace broken tile screen.
All up about 2 days easy work and less than $1,000. Repaint walls if you think it needs it.
 
Gosh agents/photographers are stupid, why not tie back the dark old curtains in the lounge room, or at least pull them wide apart, would make a world of difference to see a bright sunny lounge. Just for my part the stove in the nook in the kitchen are incredibly hard to cook on and anyone who has had to deal with one would never rent one again. Unless your arch wall is load bearing (look up in the roof to see what rafter supports rest on it) it would be very easy to pull out, but unless you could do it, would probably cost a $1k so I wouldnt, just paint up the kitchen and try some of that csm????? from Bunnings, cant remember the name but it takes water scale off fantastic
 
Thank you everyone! I really appreciate the advice :)

Luckily it seems the open inspection went really well yesterday: 7 couples through and 2 applications received so far (one of which looks especially good according to the agent). So it doesn't look like i'll have to go down the renovation route this time round.

I will definitely be taking the advice into serious consideration when the next tenants vacate, hopefully I can raise the property value and release some more equity by renovating the kitchen and bathroom (but hopefully a little further down the track).

FernFern - i'm really hoping that arch isn't load bearing, next time the property in vacant i'll be getting up into the roof to check it out.

Propertunity - thank you, I think I'll definitely be doing this next time round, I have no problem getting my hands dirty! I think taking off the rest of that floral wallpaper would also do the kitchen a world of good!

Spades - I think it was vacant less than a week, so not long at all.

jaspn - around $1000 and a lot of grunt work, the block is huge and needed a bit of clearing, and we repainted throughout and did little handyman jobs.

Heroine - From what I remember the land was $100k and the house was $90k (or it could be the other way round).

Skater, Pianissimo and Wiley - I agree, I think I was more hoping for an increase in equity so I can by another property! We'll see what the estimated increase in rent and value will be next time it is vacant and reconsider :)

DaveM - Thank you, I completely agree! I think painting the cupboards is the best way forward, they are still in great shape.

Cheers :)
 
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