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Thread: adding value to property

  1. #1
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    adding value to property

    Hello everybody,

    I am new in posting into this forum, but have been reading and following the threads here for sometime. Truly appreciated the posting and information here, thank you.......

    If we do an extension on a property and lived in it for, say, 15 to 20 years, will the extension lead to an increase in selling price later when we intend to dispose of the property, or the extension will not matter much ?

    Ie, same selling price/market value be it with or without extension ?

    The idea of my extension is to add 2 more rooms at the back of my semi-dee house.

    Thank you,.........

  2. #2
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    Quote Originally Posted by woonlm492
    Hello everybody,

    I am new in posting into this forum, but have been reading and following the threads here for sometime. Truly appreciated the posting and information here, thank you.......

    If we do an extension on a property and lived in it for, say, 15 to 20 years, will the extension lead to an increase in selling price later when we intend to dispose of the property, or the extension will not matter much ?

    Ie, same selling price/market value be it with or without extension ?

    The idea of my extension is to add 2 more rooms at the back of my semi-dee house.

    Thank you,.........
    then your title of the thread should be "Extention on Property"

  3. #3
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    one man's beauty is another man's ugliness.

    well, if you do the extension and it looks beautiful to another buyer, i am sure the buyer wouldn't mind paying a higher price.

    imagine doing an extension where the roofing material is asbestos. i am sure your future buyer would say, "hey, this is cancerous. I need to spend extra money to take this roof down. so i will pay less"

    but since you mentioned your extension is to add two more rooms. of course generally it would fetch higher price

  4. #4
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    Swee Ann,

    Thank you. Another thought occured to me : if we say : can sell at a higher price, would the reference be against if I have not renovated or would it be against a similar house nearby (which is also not renovated) ?

    How do we compare ?

    And what would be the percentage of this higher price ?

  5. #5
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    Quote Originally Posted by swee_ann_tweety
    then your title of the thread should be "Extention on Property"
    I have changed the thread title to the curent one.

  6. #6
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    Your question here is on the selling price of a property - whether more built-ups or renovations will add value.

    Have you seen the practice where the new owner practically tear down the whole house to rebuild a new one? That itself should answer your question.

    Although a renovated house should have added value, it would only appeal to some house buyers. Generally, my opinion is that house buyers prefer a simple original structure because they would like to redesign the whole house to suit their tastes.

    When we were house-hunting, we had seen a number of renovated houses which turned us off. The renovations were poorly designed and most times were non-functional. Basically the renovated houses were less attractive than untouched ones.

    Furthermore, a house buyer will not be willing to pay more. When you compare a renovated one and an unrenovated one, the one that really gets sold will be the cheaper one. The basis of the price will be the cost of the land that the house stands on.

    Hence, if you were a speculator, do not renovate the house because you will be wasting money. It is better to make the house presentable and in good condition rather than adding renovations to your taste but not to the buyers' taste.

    Moral of the story, in today's buyers' market, you should price your house lower than your competitior rather than hope for renovations to sell the house.

  7. #7
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    bear in mind that your renovation should comply with that UNiform Building By-Laws or whatever council requirements.

    The council reserves the right to tear down your renovated structure should you not comply with whatever requirements there is.

    so, this again would be a factor as to whether your house would be of higher or lower value

  8. #8
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    Quote Originally Posted by kwchang
    ...Hence, if you were a speculator, do not renovate the house because you will be wasting money. It is better to make the house presentable and in good condition rather than adding renovations to your taste but not to the buyers' taste...
    Exception may be if you are speculating in the middle-upper price segment where the buyers are more concern with aesthetics than $$$. Since these buyers will be buying out of their petty cash, price comparison is not as important.

  9. #9
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    From my personal experience, there are others who do not mind buying renovated houses but nobody wants to pay the full value of the cost of renovation. Most real estate agents will mention 50% of the renovation price.

    I, myself, prefer renovated houses if they are priced reasonably. All I have to do is to make some cosmetic changes, like the changing of the floor tiles to improve it. It does save lots of money.

    It also depends on the type of renovation done. Fish pond, jacuzzi, expensive water fountains, wall paneling etc will not add value. In my opinion, things that will add values are additional rooms, high quality built-ins and kitchen cabinets, air-cons, high quality floor tiles, automatic gates,
    3-phase wiring, etc. These are functional and practical and the buyers will love it. But others may differ with me and prefer the former. One man's meat is another man's poison.

  10. #10
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    Dear all,

    Thank you for your good inputs. Based on what I read, I would think that :-

    1) The type of renovation is important, eg adding rooms will most certainly
    increase the value, however, I must get a buyer who is willing to pay for
    this additional value, and to pay enough.

    2) If others in my area do not renovate with the generally acceptable types
    of renovation but I do, then I would probably be preferred by potential
    buyers. The only hurdle would be to convince the potential buyers to
    accept my 'higher pricing'.

    Correct me if necessary, and add more if possible.

    Swee Ann : Thank you for the reminder. Yes, I am aware of rules by the local authority.........

  11. #11
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    Quote Originally Posted by woonlm492
    Dear all,

    Thank you for your good inputs. Based on what I read, I would think that :-

    1) The type of renovation is important, eg adding rooms will most certainly
    increase the value, however, I must get a buyer who is willing to pay for
    this additional value, and to pay enough.

    2) If others in my area do not renovate with the generally acceptable types
    of renovation but I do, then I would probably be preferred by potential
    buyers. The only hurdle would be to convince the potential buyers to
    accept my 'higher pricing'.

    Correct me if necessary, and add more if possible.

    Swee Ann : Thank you for the reminder. Yes, I am aware of rules by the local authority.........
    Built-up area, land size, creating a sense of spaciousness & simple decor/reno are important to increase the value of our properties besides the other pointers indicated earlier. And yes, you can generally add about 50% of your total reno cost to your house resale value, provided that your house & its fixed furnitures are well-kept & presentable.

    House resale value is also determined by surrounding house prices too. So, best not to overly renovate...


  12. #12
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    At the end of the day, we renovate for our own comfort and usage. Our decision is based on what works for us and not what prospective buyers want. There is no end to pleasing others so do what pleases you.

    For example, after living in Australia for a very short while, I enjoyed their concept of having a rumpus room. It is a room where the family and children gather together for activities and entertainment instead of the living hall.

    Thus I dedicated a big room as our rumpus room and all of us enjoyed it so much. We air-conditioned it and the children loved to do their stuff inside the room. There is hardly anyone in the living room. When we have visitors we can entertain them in the living room and leave the children in the rumpus room.

    Therefore renovate to meet your own needs first.

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