Research the Market
Careful market research and stringent budgeting are two of the key factors in successfully renovating for profit.

Where to start?

There are two main reasons people renovate their homes: to enhance their lifestyle or to make a profit on the sale of the property. Whatever your motivation, some of the principles are the same.

You cannot ignore the financial implication of what you are doing just because you need more room for the children. Over-capitalisation can become a major problem with most renovation projects and the fact is that many people don't get back the the money they spend doing the renovations when it comes time to sell.

If you are undertaking the project purely to make a profit, it's important to follow a number a basic rules.

Research the Market








Do your research

When you look to purchase a property to renovate, do all of your homework and give honest answers to the following questions:
  • What is the big picture in the housing market in terms of interest rates and price trends?
  • Have people been moving to the area or away from it?
  • How desirable an area is it?
  • Who lives there, families or urban professionals?
  • What are the average age and incomes of the residents?
  • What is the infrastructure like (supermarkets, schools, parks etc)?
  • Are there any major projects on the drawing board that may impact negatively on the value in the future (motorways, industry etc)?
What is the big picture in the housing market in terms of interest rates and price trends?

Armed with this information, you can then determine whether it
is a good area to invest in and the sort of property most likely to appeal to those people who want to live there.

It will also give you a guide to the amount that you should invest into the project both in the initial purchase and the renovation costs.

Research the Market









Budget

Once you have a feel for the property values in the area, you need to draw up a budget that you can afford. List where the money will come from and the total sum available. Have all your figures in mind when you start to look for the property.

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