Hello, I am new here. I have difficult time deciding if I should add an extension to my home. We definitely need spare room and we have found amazing architects in Melbourne (http://www.superdraft.com.au/melbourne-architectural-services) but I still don't know if this is going to pay off in the future. Any advice, experiences? Thanks
Generally if you decide to add an extension it will certainly add value to your house. However, the thing you have to be wary of is that you don't over-capitalise your property and make it very expensive compared to other similar properties in your area. And therefore harder to sell in the future.
Just putting on a spare room should not do this but it is always wise to check before you proceed. Ask an Estate Agent to give you a suggested selling price for the property as it is now and show him/her your plans and ask for a suggested selling price on the finished product. And ask him to compare your property with similar homes in the area. I doubt you will be over capitalising at all.
Good Luck with the renovation.
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Congratulations on taking positive action to find an answer. You are already ahead of the curve by asking. Too many people just sit on the fence and never get anywhere.
I believe the place to start will be to speak to a mortgage broker, discuss your plans for the home, your income and expenses and see if he/she can work out a mortgage that fits your specific needs. Then you'll be able to see exactly when you'll be able to pay off the debt, and if arranging the extension with increased cost will pay off.
Unfortunately, no one has a crystal ball, and if your meeting with your mortgage broker establishes you can afford the increased debt, the mortgage is not unsuitable, and you like the plan, then you might need to engage a registered valuer (it'll cost a bit but a very affordable way to try to look into the future) to examine your plans from your architects, and make a judgment call of the end value, and the saleability of the improved property.
Then you're in a much better position to make the decision to move forward or not.
I hope this has helped a little Catherine - sing out if I can help you further.
Welcome aboard! I am sure the many different experts on here will guide you and assist you to make your decision.
As already mentioned, there is no crystal ball, however comparing the selling prices of the type of house you are planning to build and getting the plans ‘valued’ will give you a better insight.
If you would like, I can send you a suburb report that will show you the median and recent sales prices for as many different scenarios as you would like to compare - at no charge.
Please feel free to give me a call and I can come and meet you and your partner and discuss your plans 0435.474.498
I look forward to meeting you