It’s that time of year when television junkies and property enthusiasts sit on the edge of their couches to watch a new group of contestants take on the most epic of renovations in the latest season of The Block.
This year we’ll be watching closely as Blockheads Julie and Sasha, Andy and Ben, Kim and Chris, Dan and Carleen and Will and Karlie pick up their hammers, tools and paint brushes to construct, create and style five apartments in the sunny bayside suburb of Port Melbourne.
As the contestants work on sprucing up the former 1920s factory building, we took a look at some of the lessons the contestants could learn from previous seasons to improve their chances of creating winning rooms and apartments. These lessons will also help investors who plan to complete a renovation to their own investment properties.
Set a budget and carefully plan where the money will be spent
If there’s one lesson both this season’s Blockheads and property investors can learn about renovating from previous seasons, it’s that they should set a budget.
Dean and Shay spent a third of their renovation budget ($40,000) on their penthouse bathroom during The Block: Blocktagon season and Tim and Anastasia walked out during The Block Triple Threat when they discovered they only had $1,500 left in their Block account.
Already this season we’ve seen Julie and Sasha, Dan and Carleen and Will and Karlie struggle with budget issues during the 48 hour pod challenge and one pair has spent a whopping $65,000 on their very first room reveal, the master bathroom.
Renovations involve careful planning, so it’s important to set a spending limit and to ask tradespeople to provide a quote before they start work.
The costs of a renovation can blow out easily, particularly if plumbing and drainage issues are revealed when replacing old baths, vanities, showers and tiles in a bathroom or when removing and relaying pavers outside in the yard. In older properties you could also discover asbestos which requires careful removal which can be costly. It’s a good idea to set aside additional money just in case hiccups like these occur.
While the Blockheads are required to keep a track of their budget and have the added advantage of winning additional money from challenges, there are no such extra windfalls for those taking on a renovation at home, so without careful planning it’s easy to end up with additional debt.
Set a time frame for renovation completion
During The Block Triple Threat, Tim and Anastasia received the lowest score ever revealed by the judges because they handed over an unfinished study.
While property investor’s don’t have the same time constraints to reveal their renovations to a set of judges like The Block contestants do, this doesn’t mean they shouldn’t set a deadline for each section of work planned and due date for the project’s final completion.
Often renovating an investment property will mean working quickly so not to disrupt an existing tenant. If it’s a major renovation requiring the tenants to vacate, owners won’t want the work to go on for a prolonged period that will result in any further loss of rent.
As we’ve seen on The Block time and time again, things must be completed in order to allow a project to run smoothly. In the 2013 season of The Block Sky High, Alyssa and Lysandra showed the other contestants how careful planning earns winning results. In their two ensuite bathrooms, the pair carefully planned to place polished concrete over electric floor heating. Timing of completing such a task is important because it requires multiple steps to plan and install drainage, build screed placed over the electric heating elements, lay concrete and polish it for perfection.
For this year’s contestants, as in previous seasons, if they don’t set time frames they will no doubt end up in hot water. However if all works according to their plan this will no doubt give them an advantage that could result in a win.
Don’t just style, select assets which will increase your income
There is more to be learned from The Block than what colour cushion works best on a particular duvet cover, what colour tile to place on the walls or which vase looks best on top of a mahogany bedroom dresser.
While the new contestants should do their research to be aware of current styling trends, they should also think carefully about what they are installing in the property. As past contestants have learned, their decisions when choosing from the options available and the value of the assets they choose do have an impact on buyers. Many of the structures and assets installed will have additional value for investor buyers who can claim depreciation deductions over time for the wear and tear that occurs to the building and plant and equipment contained in the property.
Two teams who successfully sold to investor buyers in the past include 2011’s Polly and Waz and 2014’s Simon and Shannon and a number of The Block properties have been rented after initially selling to
For those planning a renovation to an investment property, while you might not be trying to tempt a new buyer, you may want to improve the rental return by luring a better tenant. You may also want to select items which will increase the depreciation benefits, so don’t forget to contact an expert and speak to a Quantity Surveyor before you start work.