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Your home is an asset

If you own your home, odds are that this is the single largest asset you have purchased. And the good news with houses is that as an asset, they usually increase in value! This also means that you can use the increase in value as equity, and use this for other investments.

Here are some tips to get the most out of your home as an asset.

Purchase
:
  • Location Location Location! It is better to buy the worst house in the best street, than the best house in the worst street as neighbouring property values inevitably have an impact on the value of your own home.
  • Buy a house that suits your needs. A 4 personal family can live quite happily in a 3 bedroom house and will be more affordable than a bigger house, not to mention easier to maintain. And with the money you save, you can put this into other assets such as an investment property.
  • Do your research – check Council records for details of existing and future services in the area, check flood zones and flight paths, get pest and termite inspections, and make sure you really know what you are buying.
  • If you are buying your home to renovate or restore, again make sure you do the research and work out exactly what needs to be done and whether you will be able to return this expenditure when you sell.
Renovating: To renovate or not to renovate, that is the question. Think about the following to help you decide:
  • Why are you considering renovating - to make money? Expand for a new arrival? Just for yourself? Your reason for renovating will affect how you renovate and exactly what you do.
  • What exactly do you want to do and how much will it cost? And be realistic here – many enthusiastic renovators (including myself!) severely under-estimate both how much money and how much time it takes to renovate. Get some good advice before you commit yourself.
  • Do you have the skills to do the work yourself, or do you need to rely on tradesmen? This will make a big impact on cost, but at least you can get a firm quote for the work, so you’ll know exactly how much you need to spend.
  • If you’re renovating to make a profit, spend your money wisely and don’t over-capitalise. Many real-estate agents will be able to give you an indication of where you can improve your house to get the best return – get this advice!
  • What are house prices in your area doing? If real-estate is slow, it may not be the best time to renovate for re-sale. If your area is going through a housing boom, then it probably is the right time to look at this option.
  • Do you have the energy and drive to renovate – it takes time and energy, there will be set-backs and things you didn’t think of. Can you cope with this?
Maintenance: Look after your biggest asset, to help keep its value!
  • Regularly inspect your house for any wear and tear and keep a note of when you may need to repair it.
  • Get periodic building and pest inspections by a professional – picking up and dealing with any major structural problems or pests early will save you money later on. Regular spraying for pests is also recommended, but get advice from a professional first.
  • Keep timber finishes protected – paint, polish or varnish depending on the finish. Timber is usually the first material to start showing signs of age. But watch out for rust on structural steel work too, and keep this in check.
  • Keep yards and gardens tidy and free from weeds. Clean up debris and gutters.
  • Keep a diary for your house and include contact details for plumbers, electricians and the like and keep a record of all a maintenance activities you’ve done.
More advice to Build Your New Home - new home construction, designing your new home, and new home for building virtually anywhere in North America.
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We are not certified financial planners or advisors. The information in this website is general information only. Always consult a licensed financial planner before making any finance or investment decision.


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