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In today’s competitive real estate environment, especially in Dubai, renovations or additions to a property can add value and give a homeowner an advantage over other sellers in a particular area. As a RICS Chartered Valuation Surveyor, I notice that while prospective investors in villas initially acquire a property primarily based on the ideal location and with the intention to renovate and extend, there are others who have bought a property that was perfect for them at the time which now no longer meets the requirements of their growing family or changing circumstances.
Should building extensions or additions be considered, it is recommended that a professional builder be entrusted with such works, as if these projects are not completed by a qualified person, the desired result may not be a positive one.
Badly completed renovations can cost far more to rectify, than if the job was completed in the right way from the start. And most importantly, a fact that not many are aware of, is the need for obtaining an approval, or a NOC from the master developer or Dubai Municipality, prior to making any alterations to their property. In some cases, a refundable cash deposit has to be made to the master developer, which will be returned upon completion of work, and after the inspection.
During the course of valuations conducted by ValuStrat, we find that certain additions carry appeal to a different demographic of buyer, so it is important to determine the predominant buyer profile in the area and specific features they are attracted to. For example, family buyers in upmarket areas are looking for attractive homes with staff accommodation. For many villa owners, maintaining a certain lifestyle outdoor living is important and, therefore, place much emphasis on attractive swimming pools set in landscaped surrounds, covered patios and gazebo areas/ cooking stations. These added features promote the aesthetic appeal of a property and can ultimately improve on the selling price achieved.
However, our surveying team here at ValuStrat have noted that some property owners have tended to over-spend on the renovations they undertake, which then ultimately exposes the investor to run the risk of losing money rather than adding value to their investment. Knowing which additions will add value and which won’t also plays a vital role in deciding whether or not to look at renovation options. A homeowner will need to do their research before they spend money unnecessarily on costly upgrades, especially if the reason for the renovation is specifically for resale purposes, which is mostly the case here in Dubai.
Being a RICS Chartered Valuation Surveyor, I suggest that property owners need to keep in mind that, money spent on renovation does not necessarily add to the worth of your home. A potential buyer will look at the market value of other similar properties and compare yours accordingly.
Some pointers on what may add value to a Dubai villa are as follows:
• Landscaping — Professional well-arranged gardens can increase market value.
• Kitchens and bathrooms — While it’s a well-known fact that these two rooms can make or break a sale, they can also be important influencers on a property’s value. Homeowners are advised to invest in regular upkeep and maintenance, with replacement say every 10 years. However, vendors are advised against excessive spending on ultra-high end finishings which their local real estate market may not appreciate — they may not get their spend back in the event of a sale!
• Flooring — Quality flooring, such as ceramic tiling or hardwood parquet can increase the price of your property. But, beware of poor quality ‘do it yourself’ jobs.
• Environment — Energy saving solutions, such as solar power and grey water re-cycling, are increasingly seen as a positive by buyers and beneficial to asset value.
Once you start exploring the possibilities, you may well be surprised to find how much your property value can increase through sensible renovation thereby ensuring a healthy return on investment and secure the asking price when the time comes.
Projects with Potential negative resale value
• The more personal the choices the less likely they are to have positive effect on resale value.
• Highest quality upgrades often don’t have the return of mid-range ones unless in a high-end home. Homebuyers are only willing to spend so much for a house in a particular neighborhood.
• Rooms that don’t fit with the floor plan. For example by converting the back patio to family room to add more space. Dining room that looks into family room won’t be well received by buyers.
• Balconies that are enclosed with poor quality partitions/glazing.
• The removal of a bedroom by its conversion to say an en suite or dressing room, thus making a four-bedroom villa a three-bedroom, can have a significant impact on value.
Projects carrying a high resale value
This includes but is not limited to:
• Keeping up to date with trends in kitchens: People like modern conveniences, up-to-date equipment and styles in kitchens.
• Bathroom makeovers. Buyers appreciate those extras such as double vanity basins and spacious showers, clean lines, modern amenities and fittings that combine practicality and aesthetic looks.
• Outdoor improvements.
Source: Cheryl McAdam, Special to Property Weekly
The writer is a RICS Chartered Valuation Surveyor and Manager, Residential Valuations, at Valustrat with 20 years’ experience in real estate and property valuations