On the back of the new Federal Government HomeBuilder package, property valuation group Herron Todd White has taken a look at the areas in each Australian capital city that are leading the way with renovations.
The new HomeBuilder package gives $25,000 to renovators who are looking at spending over $150,000 to improve their home. However, to qualify you need to earn less than $125,000 as a single or $200,000 as a couple, and the home must also be worth less than $1.5 million.
So where in Australia are the renovation hotspots?
Inner Sydney: Renovations are popular in Glebe, Surry Hills and Darlinghurst, as these areas are often heritage-listed and the cost of rebuilding makes a renovation the preferred option. There are a number of success stories here with great value-adds being completed.
Eastern Suburbs: The majority of development applications in the eastern suburbs relate to renovations and extensions. Renovations are generally made by owner-occupiers looking to enhance their current home to meet their changing needs and include examples such as renovations of terraces in Paddington and Woollahra, second-storey additions to semi-detached homes in Maroubra and Randwick, and huge extensions and renovations to large prestige homes in Vaucluse and Bellevue Hill.
Northern Beaches: Freshwater is one of the most active suburbs for home renovations at the moment. The suburb has one of the highest numbers of outstanding development applications in the Northern Beaches Council.
Inner and Outer North: Given that the Inner North suburbs tend to comprise older dwellings, at least relative to the outer north, it is within these suburbs – including Coburg, Reservoir and out to Greensborough and Bundoora – that we are most likely to see homes undergoing renovations.
Inner & Outer South East: In established areas of the South East, HTW has seen suburbs including Hughesdale, Parkdale and Carnegie undergo renovations.
Eastern Suburbs: The outer eastern ring has seen a spike in renovation valuations. Suburbs such as Kilsyth, Blackburn, Doncaster and Wantirna have had measured growth in jobs for renovations. Ranging from complete renovations, partial renovations and additional spaces being created to the homes.
Western Suburbs: Williamstown and Newport are much older and more established regions than most of Melbourne’s West which consists of newly developed housing estates. Because of this, older dwellings within these more established regions are far more likely to conduct a renovation or extension project due to owners wanting to revamp the older-style dwellings.
According to HTW, in Brisbane the demand for more extensive building and renovation work looks to have slowed. But there are some areas that have potential.
Wavell Heights has good options with very basic renovators in average positions fetching between $550,000 and $600,000 – but you need to be fast as they sell quickly. Other homes in Wavell Heights that are in quieter positions with ready access to facilities are fetching between $600,000 and $700,000 for a renovation prospect. In these instances, smart renovation work will yield an end value above $1 million.
For more budget-conscious renovation prospects, head a bit further up Gympie Road and check out Aspley and Bracken Ridge where a renovatable home can be purchased in the $500,000s. This area appeals to first home buyers and project-oriented builders.
Heritage restrictions and planning overlays catering to lower density development make the inner and middle rings ripe for those looking for a renovation project. The suburbs of Nailsworth, Kensington, Colonel Light Gardens and Mile End are each located within five kilometres of the Adelaide CBD and are characterised by early to mid-century homes on allotments ranging from 150 to 1000 square metres.
Entry price points in these suburbs range between $450,000 and $850,000 with well-established and renovated homes ranging in price from $650,000 to $1 million-plus.
Suburbs such as Mount Hawthorn, Wembley, and Mount Lawley, all being within five kilometres of the CBD, have seen a flurry of action recently. Further out of central Perth, suburbs such as Canning Vale and Atwell are creeping towards the ripe renovation age of between 30 and 35 years old – this is the median dwelling age for renovations.
Preferred established locations are the northern suburbs, like Anula. Being in a tropical climate with proximity to the beach, preferences lean towards larger outdoor living areas or the added benefit of a pool.
Areas ripe for renovation are ones containing mostly owner-occupied properties. Property owners in a position to invest back into their property are doing so for their primary place of residence and it tends to be suburbs where the majority of the residential stock was established in the mid-1980s and early 1990s, such as Isabella Plains, Calwell and Theodore.