Why peo­ple are im­prov­ing rather than mov­ing home

Central Leader - - News -

More and more New Zealan­ders are do­ing up their ex­ist­ing homes rather than mov­ing or build­ing new. A case in point is Will and Diana Miller, an Auck­land cou­ple fea­tured in a re­cent news­pa­per ar­ti­cle who said they were well aware the mar­ket was fall­ing when they bought their home for more than $1 mil­lion a year ago.

“It doesn’t con­cern me overly, be­cause the re­al­ity of the prop­erty mar­ket is that it’s cycli­cal,” Diana said. “For new Zealan­ders, our home is our cas­tle. New Zealan­ders love own­ing homes and there­fore we will con­tinue to do so.”

The Millers are also plan­ning to ren­o­vate, a strat­egy which prop­erty guru Olly New­land said in an­other news­pa­per ar­ti­cle was “a good way to shore up your home’s value in a mar­ket where it is no longer pos­si­ble to achieve cap­i­tal gains without hav­ing to do so much as lift a paint­brush.”

New­land’s rule of thumb is to get a $3 re­turn for ev­ery dol­lar he puts in.

He cal­cu­lates this by get­ting a prop­erty val­ued as it is, to­gether with an es­ti­mate of how much the value will in­crease by when the planned ren­o­va­tions are com­plete.

“As well as cre­at­ing cap­i­tal gain when the mar­ket has stopped do­ing it for you, strate­gi­cally en­hanc­ing your home now means it will be in prime po­si­tion to go on the mar­ket if you de­cide to sell and want to get the best price pos­si­ble,” said the ar­ti­cle.

The ren­o­va­tion mar­ket should re­ceive a wel­come boost from the growth in the new Zealand econ­omy that Re­serve Bank Gov­er­nor Alan Bol­lard ex­pects to be­gin to­ward the end of this year.

“For the first time in some months, we can also iden­tify some clear up­side op­por­tu­ni­ties for ac­tiv­ity,” he said re­cently.

“One such area is a po­ten­tial re­bound in house­hold spending and res­i­den­tial in­vest­ment as a re­sult of the rise in net im­mi­gra­tion and the pick-up in the hous­ing mar­ket.”

Need more space? Ring Fix It Build­ing Ser­vices on 631 7106.

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