{"id":5136,"date":"2015-07-24T01:00:01","date_gmt":"2015-07-23T15:00:01","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=5136"},"modified":"2015-07-24T01:00:01","modified_gmt":"2015-07-23T15:00:01","slug":"renovation-is-not-the-be-all-and-end-all","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/renovation-is-not-the-be-all-and-end-all\/","title":{"rendered":"Renovation is not the be all and end all &#8211; Zaki Ameer"},"content":{"rendered":"<p>&nbsp;<br \/>\nIt is romance sometimes that drives investors to think that renovations are the path to wealth. Something you can build in to add value. Well we tell you today that renovation could be the last thing you want to do. We talk\u00a0to real estate expert and wealth development coach <strong>Zaki Ameer<\/strong> from Dream Design Property.<br \/>\n&nbsp;<\/p>\n<h4>Transcript:<\/h4>\n<p><b>Kevin:<\/b>\u00a0 We talk about adding value by doing a renovation, and sometimes it might not be the answer. That\u2019s according to real estate expert and wealth development coach Zaki Ameer from Dream Design Property.<br \/>\nGood day, Zaki. Nice to be talking to you again.<br \/>\n<b>Zaki:<\/b>\u00a0 Good day, Kevin. How are you, mate?<br \/>\n<b>Kevin:<\/b>\u00a0 I\u2019m fine. Thank you. You say that renovation is not the be all and end all. Why do you say that?<br \/>\n<b>Zaki:<\/b>\u00a0 I feel most people who buy a property whether it\u2019s in original condition or somewhat even new condition, they believe that just because they renovate, they\u2019re going to increase the value of the property or increase their rental income. I don\u2019t think that\u2019s the case in all investment properties, as I\u2019ve experienced myself.<br \/>\nSome properties, if you do your research, even if it\u2019s original condition and can do with a new bathroom, kitchen, etc., you might see that you\u2019ve already got good value in it. So I suggest that do you research, see what the comparable properties in the areas are selling for, for a similar condition, and just have a think about \u201cIf I did spend $50,000 renovating this property, is it actually going to increase the market value?\u201d Or even when it comes to the rental income, is an extra $10 to $20 of rental income a week going to make such a difference to go through the headaches of managing a renovation.<br \/>\n<b>Kevin:<\/b>\u00a0 Yes. As you say, not all renovations are going to return well for us. How do you know which ones to renovate and which ones not to?<br \/>\n<b>Zaki:<\/b>\u00a0 Definitely, the first thing you have to decide is \u201cAm I making an emotional decision renovating the property?\u201d You might want to actually question that yourself before starting a renovation.<br \/>\nThe second part is when you know you\u2019re doing this <b>[1:36 inaudible]<\/b> numbers, just to work out the numbers, saying, \u201cOkay, if this property was bought for \u2013 let\u2019s say \u2013 $500,000, and I\u2019m going to spend $15,000 renovating, am I going to make an additional $30,000?\u201d What I\u2019d look at is somewhat close to doubling the value of the renovation before I begin that process.<br \/>\n<b>Kevin:<\/b>\u00a0 Of course, it\u2019s very easy when you\u2019re doing a renovation to over-capitalize, as well. Is that one of the other problems, Zaki?<br \/>\n<b>Zaki:<\/b>\u00a0 That\u2019s true, and that\u2019s the same with our clients at Dream Design Property, and that\u2019s one of the reasons we offer that project management for renovations. We find many investors out there not really having the experience to project manage a renovation. The builders will say, \u201cYou need a new this, new that,\u201d and then you just keep spending money because you feel like that\u2019s the right thing to do, and before you know it, you\u2019ve over-spent.<br \/>\n<b>Kevin:<\/b>\u00a0 One of the problems I see, too, with people who do renovations is that they renovate from the heart as opposed to from the head. In other words, they don\u2019t really look at it as a business.<br \/>\n<b>Zaki:<\/b>\u00a0 That\u2019s correct, and that\u2019s a rule of investing, anyway. You have to decide that investing is a pure numbers game and has nothing to do with&#8230; Controlling emotions is everything about it, and that\u2019s why sometimes outsourcing those positions of project managing a renovation is probably a good idea to someone who does this day in and day out for a living.<br \/>\n<b>Kevin:<\/b>\u00a0 Is it still possible, Zaki, to buy a property, to renovate it, and then flip it and make a profit, or are the margins too narrow nowadays?<br \/>\n<b>Zaki:<\/b>\u00a0 Compared to when I was investing seven years ago, 2007\/2008, I feel like they\u2019re starting to slim down, because the majority of the investors, like myself, have already got into the market, especially around Sydney\u2019s western and southwestern suburbs, and turned in all those original-condition properties back to somewhat new condition. I feel it\u2019s just a matter of time before you have that opportunity, again, to go in and turn it around.<br \/>\n<b>Kevin:<\/b>\u00a0 How far away do you think that timing is?<br \/>\n<b>Zaki:<\/b>\u00a0 In my view, I\u2019d give it another ten years, especially for Sydney. But if you look at the Brisbane and upcoming areas in Brisbane, then you have the same opportunities I had back in the western and southwestern suburbs of Sydney to renovate a property.<br \/>\n<b>Kevin:<\/b>\u00a0 What sort of properties are good in the Brisbane area to be renovating right now? The Old Colonials?<br \/>\n<b>Zaki:<\/b>\u00a0 Yes, that\u2019s it, the same thing \u2013 the properties that are about 30 or 40 years old in the surrounding areas of, say, Logan, Ipswich, <b>[3:57 inaudible] <\/b>areas, some areas around the Gold Coast. They have properties in original condition that you could buy and renovate.<br \/>\nBut once again, you have to do your research, like we do for our clients, before you actually even purchase a property. \u201cIs this property one that we\u2019re going to renovate? And if we do renovate, is it going to add value to it?\u201d<br \/>\n<b>Kevin:<\/b>\u00a0 That makes sense to me. Thanks for your time. I\u2019ve been talking to Zaki Ameer. Thanks, mate.<br \/>\n<b>Zaki:<\/b>\u00a0 Thank you, Kevin.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&nbsp; It is romance sometimes that drives investors to think that renovations are the path to wealth. Something you can build in to add value. Well we tell you today that renovation could be the last thing you want to do. We talk\u00a0to real estate&#8230;<\/p>\n","protected":false},"author":176692471,"featured_media":5137,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[10,13,25],"tags":[101],"class_list":["post-5136","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-kevin-turner-sponsored-channels","category-latest-story","category-sponsored-channels","tag-podcast"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Renovation is not the be all and end all - Zaki Ameer - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/renovation-is-not-the-be-all-and-end-all\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Renovation is not the be all and end all - Zaki Ameer - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"&nbsp; It is romance sometimes that drives investors to think that renovations are the path to wealth. 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