i have just partnered my first real renovation, it was a family home which was built by my family in 1950's in the suburb of ________ , (cant tell you the suburb ) Melbourne. (which has had lge growth and expected another 11% in next 1-5 yrs)
It was one side of a duplex and the floor plan was hideous, 2 bedrooms , 1 bathroom , dark , dirty and very very original. we had it valued in April at $440 k by 2 real estate agents (drive by), i proceeded to change the whole floor plan i moved the living areas to the back , new bathrooms, kitchen, extra bedroom and converted the garage into a studio. Spent around 90k all up. Came up beautifully. We sold it sunday for 685k so we made a decent profit. Very pleased with the result.
NOW heres the tricky part ,
we also still own the other side(tenanted, thats why i cant tell you) is is an exact mirror to the what the other one was, i asked the agent after the auction what that would be worth now and he says 560K, thats over doubled in 5 mths!! .
so what do i do… ???
do i spend 70 – 90k doing it up the same way?? i know i can do it quicker and cheaper next time…
or do i just do a quick paint??,
i find it hard to believe that i could get such a great result again
if you were successful last time why wouldn't you?? to me its a no brainer
p.s you dont have to sell it! borrow the money to renovate and re-finance and rent it for some more to help cover the interest costs! ((assuming you have another income to facilitate the loan)) use the extra money you have gained to renovate another property
p.p.s if you dont want to sell it, but cant afford extra repayments just give it a paint and sit on it mate
the folks want to get rid of it, no loans are involved,,,
the thing i may have not explain exactly was the fact that i am a bit worried on the initial valued price, b/c i just cant get it through my head that a suburb can go up by so much ,
so if i spent 90k on top of the 560k (it is worth today) and do it in 2 mths , have the auction in 3 mths do you think i could get $750+ ??(560 + 90 = 650 spend then sell 750k+? )
I think the agent valued it so high because the other side sold for 685k.
The growth is probably due to this and not the suburb booming.
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