Maximise an apartment’s price by adding a bedroom

Real Estate

Team MONEYME|30 September 2022| 2-minute read

When it comes to renos, the lower the spend and the higher the value add, the happier the property owner. 

Making a few changes, like sprucing up the kitchen, might boost value by tens of thousands of dollars. But what about adding an entire bedroom? 

A smallish spend—maybe $10,000—could translate to a $200,000+ increase.

When and where this strategy works

Adding a bedroom is likely to be most lucrative in areas where space is at a premium and multi-bedroom apartments are scarce.

Take, for example, an inner Sydney suburb, such as Elizabeth Bay, where studios and one-bedders dominate. This means that two-bedders and three-bedders typically sell at much higher prices.

In July, an $8,000 reno that turned a two-bedder into a three-bedder in Cremorne created $300,000 in value. 

What else should be considered?

As tempting as this strategy is, it’s important to do your research first. 

Adding a bedroom isn’t possible for all apartments. There’ll need to be enough space, the right underlying structural elements, and, in some cases, original plans that provide for an extra bedroom. 

Other aspects of the apartment should also be considered carefully. Are the lounge room, kitchen and bathroom big enough to accommodate an extra person? If not, is there room to expand any or all of the shared living areas?

How can real estate agents employ this strategy?

This strategy could help to captivate a range of buyers. These might include couples thinking of starting a family, people keen to live in the inner city but wanting an office space, and those looking to invest for maximum returns. 

By suggesting the possibility of adding a bedroom, you encourage prospective buyers to think more broadly. After all, when it comes to selling properties in need of renovation, capturing the imagination is half the battle.

Takeaways:

• Adding a bedroom can be a relatively inexpensive way of adding value to a property, particularly in areas where space is at a premium.
• It’s important to research first, to ensure that the addition will be practically possible and is in keeping with market demand.
• Real estate agents could consider suggesting this strategy to increase sales prospects.

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