An increase in Sydney property prices has sparked a renovation boom. Home owners are looking to capitalise on the value of their properties, with the trend forecasted to double over the next three to four years according to the Housing Industry Association.
Figures from the Housing Industry Association (HIA) show that after five years in decline, people who will invest in renovating their homes will increase by 7% this year.
While Australian Bureau of Statistics (ABS) figures show Sydney property prices have increased by 20% in the past 12 months, renovation costs have remained relatively static.
''With property prices in Sydney increasing substantially in the past 12 months a lot of people are looking at the property they currently occupy and thinking of capitalising on the equity in their own home,'' said HIA spokesman Nick Proud.
Archicentre ACT & NSW State Manager Angu Kell said the cost of selling a house and buying a new one was also a factor.
''The cost of relocation can add up to $50,000 in stamp duty, legal fees, agent's fees and moving costs,'' said Mr Kell.
''If you have to borrow extra money to buy a more expensive house, you have to factor in rising interest rates as well. So people who like the area they live in are more likely to stay put and invest in the house they have and make the additions or alterations that suit their needs.''
Rising interest rates and stricter lending practices are also influencing people's decision to renovate rather than sell up and move.
''People are less likely to take out a big loan to buy a more expensive home if they know interest rates are going up,'' Mr Kell said.
''And changes in the finance industry in the past couple of years mean banks are less likely to offer loans of 90 per cent of the value of the property.''
Many Councils in the inner-ring suburbs of the inner-west and lower north shore in Sydney are reporting a surge in the number of development applications for alterations and additions to residential properties.
If you are thinking of renovating and need an owner builder finance or construction loan, speak to one of the mortgage brokers at Intellichoice today on 07 3624 1900.
Figures from the Housing Industry Association (HIA) show that after five years in decline, people who will invest in renovating their homes will increase by 7% this year.
While Australian Bureau of Statistics (ABS) figures show Sydney property prices have increased by 20% in the past 12 months, renovation costs have remained relatively static.
''With property prices in Sydney increasing substantially in the past 12 months a lot of people are looking at the property they currently occupy and thinking of capitalising on the equity in their own home,'' said HIA spokesman Nick Proud.
Archicentre ACT & NSW State Manager Angu Kell said the cost of selling a house and buying a new one was also a factor.
''The cost of relocation can add up to $50,000 in stamp duty, legal fees, agent's fees and moving costs,'' said Mr Kell.
''If you have to borrow extra money to buy a more expensive house, you have to factor in rising interest rates as well. So people who like the area they live in are more likely to stay put and invest in the house they have and make the additions or alterations that suit their needs.''
Rising interest rates and stricter lending practices are also influencing people's decision to renovate rather than sell up and move.
''People are less likely to take out a big loan to buy a more expensive home if they know interest rates are going up,'' Mr Kell said.
''And changes in the finance industry in the past couple of years mean banks are less likely to offer loans of 90 per cent of the value of the property.''
Many Councils in the inner-ring suburbs of the inner-west and lower north shore in Sydney are reporting a surge in the number of development applications for alterations and additions to residential properties.
If you are thinking of renovating and need an owner builder finance or construction loan, speak to one of the mortgage brokers at Intellichoice today on 07 3624 1900.
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