Buying a Renovator’s Home: Costs and Checks

A property needing work can offer scope to create a home that suits you. It can also expose defects and costs that are difficult to judge at an open inspection. Assess the project before assuming renovation will produce a profit.

Inspect before committing

Use suitable building and pest inspections and ask qualified tradespeople about significant faults. Review the contract and relevant planning or strata restrictions. A cosmetic refresh and structural work need different budgets and expertise.

Price the complete project

Seek written quotes with clear inclusions and allow a contingency for unforeseen work. Include holding costs and temporary accommodation if needed. Compare the purchase and renovation budget with other properties that already meet your needs.

Check approvals and qualifications

Find out what approvals, licences and insurance apply to the proposed work before starting. Do not assume every job is suitable for DIY. Confirm the scope and responsibilities in writing with the people carrying out the work.

Treat tax separately

Renovating a home does not automatically create income-tax deductions. For a rental property, initial repairs, improvements and ordinary repairs can have different tax treatment. Ask a registered tax agent about the actual expenditure rather than treating the whole project as an immediate deduction.

Allow for uncertain outcomes

Renovation does not guarantee a higher resale value or profit. Decide whether the home works for your intended use and whether the budget remains workable if the timetable extends or the market changes.