Jane and John review Module 8 on cosmetic renovation and Module 9's structural case study, then answer questions on staging, council approval, and costs. They explain the refresh rule of thumb (1-2% of property value) and note that a box-on-the-back addition runs under A$100k. Key topics include restumping, tiling choices, and how valuers assess improvements.
Chapters
The broadcast is now starting. All attendees are in listen only mode. Hello, it's Jane here and welcome to the Q and A call number eight which is all about renovation. Just to get some housekeeping out of the way, please type in if you can hear me and see my screen. No, we've got no one here. Hello, can you hear me? Yes, Wonderful. Well, this week is a pretty exciting week actually. It's all about the cosmetic renovation case study. But today you can ask me anything about renovation you like. And to help answer some of those questions, I have with me the co creator of the Ultimate Guide to Renovation, John. Hello, John.
Hey, Joan.
So guys, what do you want to know? How do you change a washer and a tap? How do you build a deck? How do you know that you're actually adding value? Where can you add the most value? What goes first, the painting or the floor sanding? Look, these are things and a whole lot more that we're going to attempt to answer for you this week. And if you don't know the answer, well John, you could help me out.
Yeah, we'll just look it up on.
The Internet if all else fails. Right. We had an interesting question this week in the a private Facebook group about how to pull off plaster and I coincidentally got someone send me something in the email saying hey, this is how you handle holes in plaster. Which was a picture of, I don't know, what's his name, Cookie Monster.
Yeah. One good thing about plaster is it's just water based so it does wash off, but it's just a pain if it gets into something with pores.
Well this week John is I guess a bit sad in some respects. It's week eight, it's the last call for this intake of students. But rest assured guys, we're still around on Facebook for another month and we're here to answer as many questions as possible for you. And I guess you know you've been through a bit of a journey with us. The, the modules are obviously going to be delivered to you for the full 12 modules and you have access to those forever. We're going to combine this call into module 8 and 9, which is the exciting one. Well, this is the real nitty gritty renovation stuff. We've really found the right property now and yes, it's time to do something.
Yeah, yeah. On the ground virtual.
So John, I guess we need to get back out into big wide world and practice what we preach, so.
Yeah, that's right. Well we don't want to be kind of those guys that you know, just sit doing courses and don't actually do anything else. So, yeah, that's what, that's what I'm going to be doing the last, I guess nearly, what year and a half, nearly two years now has been spent kind of concentrating a lot on this course and getting it right. And so I'm ready to go out and start a project myself too. What about you? What are your plans?
Oh, gosh, you know, we've just talked about a bit of a problem I have with a current property of mine at the moment. I've got a palm tree that's fretting palms and annoying neighbors and a bit of a public liability damage. So I'm rushing around at the moment trying to find an arborist to chop it down. So, you know, some immediate things in actual banks. I'm focused. But, you know, Investors Choice Mortgage is taking up a lot of my time. Obviously people are really, really taking the plunge into the market at the moment. And we've seen, you know, record clearance rates around Australia. We've got, you know, all the property experts are talking about this is the year you've probably seen my. Your property success toolbox this month. And, and I just very, very clearly thinking that 2014 is the time that people can build their property portfolio. So we're really focusing on helping people getting their finance organized at the moment. But it's an exciting time.
Yeah, yeah, that's great. Yes. Yeah. I guess I suppose for some people it might seem a little bit funny that we've had all the calls and now it's just the last call where we're talking about the renovation course itself and it's just on renovation. What would you say to people there that.
I think that. What are you saying? Why have we done the majority of the course around?
Why have we waited it the way we have the course?
Oh, look, a number of reasons and I guess over the last 10 years of talking to thousands of people about their property investments and mentoring people through them, one of the things that I've seen has been the major stumbling block. And you know, we talk to a lot of people who've done other courses as well, and I think it's because they haven't found the right property. Because the reality is unless you can find the right property in the right location with the right potential for renovation and to add value, you know, you kind of behind before you start. And I speak to a lot of people go, yeah, I inherited this old house from a mum and I'm going to renovate it. And flip it and make some money. And the reality is it's. It was probably a great location to grow up and a great location for Mum, but it's not a great location to flip.
Yeah.
And. And I know a lot of courses out there concentrate a lot on the renovation and. And to be honest, it's the fun stuff. You know, we love renovating, don't we?
Yeah, I mean, that's why this is. Today's a good episode. But, yeah, I do. I mean, we. This was a conscious decision. I remember discussing it with you, how we were seeing, you know, people coming unstuck and, and that while there was, you know, some things were being. Some really great techniques were being taught or tactics on the renovation thing itself. It's. It's really the buying and, and we wanted to kind of put the course together so we could set people up that they could put together good deals themselves, find the right place to buy. And hence the reason we've weighted the content the way we have.
And, you know, we've had a lot of beta testers go through June, July, August last year, and then we had our intake for November 2013. And we know that, you know, you're going through these courses. A lot of people, I mean, we're talking about module 8, 9. A lot of people are still doing their dot map.
Yeah.
And their price pin map from module 2 and 3. So we know realistically, you haven't bought the properties yet. And, you know, concentrating on actually doing that research and finding the right properties where you are now in, you know, even if you did buy now, you got six weeks to settle and then, you know, and you should be planning your renovation at the moment. But, you know, you can't actually be hands on. So. So we knew that it was going to be down the track that people are going to be renovating anyhow. So the reality is that if we can give you an overview of the renovation component and, you know, that's. That's really important, but, you know, getting you through the process of finding the property was for us very, I guess, missing in the market, where we've seen in other courses. But. Yeah, but also where the point is, where the end is, where the money is.
Yeah. How you make it work.
Yeah. So there you go. That's where we are. But oh, my gosh, I love the cosmetic renovation reveal and the box at the back that these guys are going to get into. So I'm just so excited about, you know, some of the feedback from. From people who've actually had A look around.
Yeah. Yep.
So I guess we've arrived at the, the down and the, the dirty inside information of the renovations.
Yep.
And to make the most of it, guys, you know, in our last call for a while, I want to make sure that, you know, you mentioned, I mentioned that there is an option to rejoin the Q and A calls in October.
That's right, yeah. So that might work out that you've started the renovation and then you, and then you rejoin for the, for the calls and there's a small fee involved in that. But there is an opportunity to rejoin the calls that, you know, next time in October or next year or the year after that or whatever.
Yeah. So I mean we want to give you as much as support as possible. Obviously the calls from the previous intaker there as well that you can have a look at. So yeah, let's blast through some of the housekeeping, John, and get into the exciting bit.
Yep, for sure.
So if you're on the computer experiencing problems or perhaps you can't hear during the questions, there's an option to call on the phone. You can see that in the sidebar under the audio options there's a drop down menu. You can call that number from a landline, mobile or Skype. And when you do have a question, please put your hand up. As soon as we see that your hands up, we're going to open up the question line for you. You'll hear someone say your line's unmuted and then you are on. And we have some more. I think Lorraine's called in again. Has she?
Yes, she has.
I love the fact that we're getting some use out of that, that call in line. So that's where people could ask their questions. Look, if you can't talk, we understand some people are sitting in their offices, some people we've had on buses. So just type your question in. Just let us know that you can't talk.
Driving between Geelong and Melbourne.
Yeah, that was pretty amazing. Not actually the driver but the passenger. So yeah, so typing the question would have been a bit illegal. But look, there's no silly questions. As you know, we will do our darndest to answer it. And if we can't answer them, we'll.
We won't make it up.
No, we won't. What you see is what you get. So lastly, just a reminder, this is non technical support call if you are having any problems, videos down, don't, don't download or there's a few issues, send an email straight to supportourpropertysuccess.com we are on to that, monitoring that email religiously. So we want to make sure that you guys, nothing stops you learning. So if there's any issues, let us know. So that's about it. Right, let's move on to module 8, which is fantastic. So module 8 is, it's the cosmetic renovation. This is really my. Is where I get excited. I know that module 9 is the structural renovation where it's your kind of happy place.
Oh, I like both.
Well, look, it's. I guess the really important thing that I want to stress about module 8 is this is not your chance to create your perfect home. So don't get emotional.
It's not personal taste, not an avenue for self expression.
Exactly. And I know with my purple feature wall that I did in 2001, it was, it was a lovely moment for me when I saw it. But when I had to repaint it in 2012, you know, took like four coats. So, you know, it's important in the cosmetic renovation to know where to add bang for the buck. And there are different types of cosmetic renovations. You know, there's the refresh where talking about cleaning and potentially just doing landscaping and you know, it might cost you 1 to 2% of the property value. We then have the repair where you pull out your toolbox and you do a bit of work on it. And you know, it's once again a really small kind of cost to you. The rejuvenation is where he's around that 10% of the value of the property. Where you doing the kitchen, the bathroom, you know, you're doing the light fixtures and fittings, you're doing the floorboards or the carpet, you know, you're really doing something quite substantial. So there's kind of like three categories. And I think, you know, everyone's always looking for a golden rule of thumb of how much to spend on these cosmetic renovations. And the reality is that it is all about the perceived value and what the end result is. Because you know, you can bet your bottom dollar if you don't have to go and put in a new kitchen and you can go and scrub clean an old one, you know, pull out a few trees, make the landscaping look fantastic and add 50 grand in value. Like, gee, lap that up. You know, just because it's a renovation opportunity and that's what you've been educated in, doesn't mean you have to do it.
Yeah, that's right. And yeah, it's always difficult, isn't you get in there and you look at it and you think, oh, is it, Would it be easier just to rip it out? And with cosmetic. Normally the answer is no. You're better off working with what's there because the margin is just not enough. It's different if you're building a box on the back and you're going to gut the front of the house entirely because you're taking up into a completely different level. But yeah, you've just got to be wary of the fight. You pick.
Exactly. And look, you know, when we're talking about perceived value, we're also talking about perceived value in the eye of the valuer because they're the ones that are going to really be in control of you releasing that equity to do it again and do it again and do it again. So, you know, we're talking about creating the perception of the value that you've contributed, so the additional value that you've added. So that really important in knowing what the end value should be before you buy. So we've been over that for the last six modules and understanding what it looks like. So understanding the fixtures and fixtures and finishes for a particular area and demographic. So you don't need to have Caesar Stone in the back of beyond.
Yeah, Yep. And that's where it comes into. It's not about, you know, an avenue for self expression or your own personal taste because all you really need to do is renovate it up to that, that end value level, which ideally that doesn't want to be the top of the street. That's at that 80% mark in the street. And then, you know, you're in safe territory.
I mean, I've, I've been guilty of self expression. I think I shared my, my beautiful nozzle in my bath that I had. But you know, it's, it's hard to, it's hard to separate yourself from it. And that's why the budget is so important up front.
Yeah.
And understanding that. And if you are going to spend more money, no problem. But just make sure that it comes out of your budget from somewhere else.
Yep. Otherwise it's coming out of your profit.
Exactly. And that's what we don't want. So we looked at kitchen renovations, bathroom renovations, exterior renovations, some color tips. We had a, a nice little cover chart there.
That's great.
And gosh, by now people should almost be getting those trade cards in the mail.
Yeah, I know a lot of people got them yesterday and there was an email today I saw. I think most people would have got that with their login details and everything.
So I'M so excited.
Yes.
I'll tell you what, I'm going to be signing up for that master's 5% discount as well.
Yep, absolutely. Look forward to getting through and looking at all the Harvey Norman commercial stuff as well.
I know, it's just, look, it's amazing. And you know, we've given you the color tips. Go, go to the, the paint supplier and get the discount. Get the, get the color. And that's. Gosh, I've spent days wondering about colors and shopping price. If we can, if we can cut that out of your timeline and move you on to, you know, really adding some value.
That's.
I don't know how you put a price on that, do you?
No, it's great. It'll save you a lot of time. I think it's also in a lot of areas. You can now use that as a good base for getting other quotes because you still should get other quotes, in my opinion. But now you've got a really good base to start with and, you know, hopefully not many times you're going to beat it too.
Exactly. So, no, it's all great. High gloss finishes. You love high gloss finishes.
Yep. Shiny cells. So shiny. Everything. With me, everything ends up shiny. And you see the finger marks where people walk along and they all, they run their fingers along it. Oh, gee.
How good is that floor sanding? I gotta say, I've got some photos. I might actually throw a few up on the Facebook page. I did a property inspection yesterday. And you know when you put your heart and soul into renovating a property and you walk through and you look at the floor and you go, you know what? Wear and tear doesn't really cover this. This is like someone has been doing weights here and slamming it down on the end. But that's what bonds are for. And you know, they're paying a substantial amount for the privilege of living in the house and I enjoy the fact that they've got tenants there. And I renovated it to create some equity. I pulled out the money and bought another property. And, you know, sometimes you have to go back and have a look at the properties that you have renovated as part of your inspections. And all I do is take photos and go look when they move out. These are things I have to fix.
Yeah, yeah.
And it prepares you, as long as you don't get emotional for it.
Yeah. I think the, the first goal, particularly if you want to pull money out and go again, is to get the highest value you possibly can. I mean, I've heard of people actually Sanding floorboards and rooms and then putting carpet straight down over the top.
That's me.
Oh, was it Okay? I couldn't remember who it was.
I heard it somewhere.
Yeah.
And you know why? There's a couple of reasons for that. Shiny cells, let's face it, and depreciation. It's better depreciation on the carpet than on the floorboards.
Oh, there you go.
And it's much easier to get your bond back when they damage the carpet than wear and tear on floorboards.
Yeah.
So there's. There's a couple of double whammies there.
Yeah, yeah, yeah. Well, typically people like carpet and bedrooms, don't they? So it's. It's a good thing.
But it's funny, I was speaking to someone the other day who posed a question about carpet in the property, and it turned out that they were doing a renovation in cairns. I'm like, seriously, everything's tiles.
Yeah.
Let's not make a rule of thumb just because there is a rule of thumb. You have to work with the demographic and where you are.
Yeah, absolutely. I was thinking with my Victorian hat on there.
Yeah. Okay. Window coverings, landscaping. And we've got some great landscaping tips just in the budget. We've listed down some actual plants that people can use from one of your landscaping.
Yep. The yuccas, the cordylines, the black dyed mulch.
Furniture staging. Some pretty interesting posts I put up on the Facebook page this. This week also about some furniture staging.
And yeah, I mean, that's always a question that comes up. People say, oh, do I really need to go the expense of spending a couple of grand on furniture staging when all I'm going to be doing is pulling it back out again when I get my tenants in. So what do you normally respond to.
With that look to save money? I've always lived. Well, not always. Pretty much most of the renovations I've done, I've lived in the properties while I've done it. Y so. And then gone and rented somewhere else out after I finished that Renault. So, you know, often you'll see my before and after photos the same furniture. I'm not someone for splashing out on furniture every year, so. But. So I definitely know that although the valuers will tell you that there is absolutely no difference when having a furnished or unfurnished property, you create the scene. And you don't just have a lot of empty rooms. They take longer to look through them and they're more engaged often, you know that five to seven minutes that they're there. Any way to do the valuation on behalf of the bank. They're, they're actually verifying numbers that they think and they've done research on anyhow. And usually most valuers have, are special specialize in two to three suburbs. So they have been to most of the properties and sometimes twice. So they're just, they're just going, look, I've been to the other three bedroom houses in weatherboard houses in this street and I'm just going to verify that what I see inside is exactly what it is. And that's sometimes why it's really important when you speak to your bank, if you are at an 80% loan to value ratio, they'll just order a desktop valuation. The valuer won't walk through. So speak to your mortgage broker. Maybe they just pop it over and list it as an 81% LVR to make sure that there's a walkthrough valuation or you request one specifically, but you want to get full, full bang for what you're doing that thing. So it's pretty important.
Mortgage broker, right?
Hey, so I guess there should be some questions about that. So anyone got their hand up, John, that we can throw to and just see if they want any questions on module 8 and then we'll move on to module 9.
I can see Deborah here. Let's have a go.
Hey Deb, how are you going?
Hi.
Good, thanks. Jane and John, how are you?
Very well.
How can we help? I've just got two questions like I've done all my dot map and that finished that last night and discovered, you know, that I can only buy units because of my budget. But I want to know how you can, how the exterior of the unit affects your interior because you don't have much control over that. And is it worth staging furniture in flats like it is in houses? Okay, so we might take on the external look first. A couple of comments I'd have around that. When you're looking and evaluating a unit to purchase and this is when it comes down really, really why it's so important for you to go in and get the body corporate minutes and go through and get the, the strata reports and look at the annual reports and I usually go through and look for 10 years and I'm looking for things such as, you know, have they made exception the body corporate refused anyone doing renovations in the past because if someone makes an application to put on an air conditioner and they say no, you can't do that, then you know, you might actually have a group of owners that are not going to be very nice to you when you're trying to renovate. But the other things I look at just walking around the outside of the property, if it's got, you know, window sills that have got chipped paint, then I'm going to be making a mental kind of note that says, oh, in the next couple of years we're going to have a special levy to replace the frames or paint them. So then when I go in and have a look at the strata report or the strata minutes from the meetings, annual meetings, and make sure you look at all the information as well, not just the annual or not just the minutes and the meetings that you do list down. You're looking for that sinking fund to make sure there's enough money in there. So they might have 15 grand in there already to cover the window frame repaint or they may not. So you just have to be aware of that. So from an external point of view, yes, it is important that you have a property that looks good and especially when you're talking about it looking good for the potential tenants and for the value of walking in, there is some opportunity though for those smaller developments that you're talking about being able to influence the body corporate. So I've had a number of students who've actually gone onto the body corporate and said, okay, maybe we should paint the internals. You know, we've got some money in the sinking fund, maybe we should render the outside. And I've seen some of the eastern, eastern suburbs, blocks of units where the, the owners have got together and said, hey, how about we render this, we make it nice, it's not red brick, you know, we maybe put on balconies, etc. And I know specifically an example that we have at the moment, we've got a unit right on the beach at Bondi beach and we've just put in application to council to actually put small balconies on the large windows and make the windows larger out the front so there is the opportunity to make changes. It is expensive, but, you know, having a well maintained building is utmost importance and also having enough in the sinking fund to cover what you can see within your eye, which might be an issue coming up. So does that kind of answer your question? That question, Deb? Yep, that does. And moving on to the next question, which was staging in flats. I've got a couple of units and I've always staged those and as I said, I've lived in most of them whilst I've been doing it, but just to get that Valuation. So for me, I've done that. But I guess the thing is you need to kind of weigh up the cost versus the benefit. Now if you're buying in your location and where you're kind of living, then I've seen people go through and actually grab some of their extra furniture and grab their friends furniture with a trailer and stage a unit because it doesn't take a lot often. And to the extent that I've seen people put down like a great big piece of foam over milk cartons and make up a bed and pretend it's a bed and it kind of looks like a bed because talking about someone who's walking in and walking out of the property, so, you know, we're not talking about someone who's spending a lot of time and jumping on beds, for instance, so often you don't need a lot to make the property look good. Spending two to $3,000. And I've had a chat to someone recently about this. On a. On a unit compared to the value that they were going to be able to add and what was going to be conceivable on what the end value was, we decided it really wasn't going to be worth their while. So, you know, we're talking about a $10,000 renovation to get a unit up to a certain, certain end product look and 2000 in addition to that to actually stage it. I'd be saying absolutely not, you know, but we're talking about a $600,000 unit and maybe two grand to stage it. Maybe. But I'd be more inclined to go and grab some friends and furniture and stage the place myself for a bit. Okay, great. Thank you. Thanks, Deb. Do we have anyone else over there?
Yeah, we'll find someone. Ok. Rachel.
Might have to unmute. Debate. Rachel. Hey, Rachel. Welcome.
Hi.
How are you, Jane? Good, good. I think it's the first time we've spoken to you. It is, yes. I've been eagerly awaiting the box on the back, basically. Oh, my gosh. Well, you're going to be so excited tonight. You're going to wait up tonight.
I know.
Looks like Christmas. Where do you see the blueprints? Oh, my God. It's. Anyhow. Oh, wow. So, yeah, that was one of my questions. So we will get to see blueprints and will they be sort of like working drawings that I can show, you know, someone so that they can do plans for a house for me?
Yeah, they're elevations, so they're. You'll still need to get building drawings. And you would you Even if we gave you building drawings, you would still need to get building drawings because it'll have to be, you know, suit your site. Yes, but they do have a, like a close up of how the, the posi struts are attached to the back of the house, which is kind of one of the main tricks of the box on the back. So basically it kind of gives you all the information you need is where I'm going with that. And then you can take that to your draftsman, they'll go, oh yeah, see what you mean.
And it cuts out a big part of the step of actually design that the darksimmer has to come up with. And I think there's like two or three pages there. Yeah, but. And essentially what they, they do is it allows you to have something that can describe exactly what you want to to a professional who can take that on and, you know, do up your working drawings and go from there. So it's going to cut out a lot of time. Perfect. Yes, that's what I was wondering. Anything else, Rachel? Yes, I'm wondering with the construction method because I know you sort of said it was sort of borrowed more from perhaps, you know, commercial construction rather than residential. So do you need a specialist builder who's familiar with that or should most builders be able to adapt to that method?
Most builders should be able to adapt. It's what we're referring to. There are some of the things like the windows, for instance, a commercial windows that we've used. I changed to stackers. I used to use bi folds and I found that using a commercial or industrial kind of stacker in black aluminum is what I choose because I mostly just have everything white essentially, and then use black windows. And contrast is kind of the thing that I just do over and over again. So they're industrial windows in terms of the things like lvls and posi struts, which are the, the rafters and beams and that kind of stuff. That's all stuff that builders use. They normally use it for a different purpose. So they normally use a posi strut, for instance, on the second story or between the first story and the second story. So it becomes the, the ceiling rafter and, and the floor joist in one. So it's all, they're all materials a builder will be familiar with. But we're kind of just using them in a bit of a different way. So we can, we can essentially build a big box on the back with one big long span. And, and, and it doesn't look like what it is. Which is a lean to, I guess a lean to.
That doesn't lean.
Yeah.
And that's just because of the. The walls that you put up at the side, isn't it, that they can't see the lean. Is that right or.
That's right. And if. And so the only place you can see it is at the back where you can. And depending on how deep your backyard is, you know, if you can walk back 20 meters, you might be able to see that the. What. What's going on. That you can see the walls at the side. There's a couple of ways around that if you want to conceal it all together. I. To be honest, I don't think it's necessary because they're kind of well and truly sold by the time they hit the lounge room from the inside. They don't kind of walk out the back and they go, oh, what kind of construction is this? So you kind of got them hooked by the time they. They walk into the huge open plan with glass everywhere. And because it allows you to have a nice big, long kitchen which runs away from the entrance to the lounge room, too. So it just seems like it's got a lot of depth and it's. And it's big. But. Yes. Now, the other thing I was going to say is there was. I went through an inspection and I got a lot of ideas. Last Saturday, you may have seen the posts in the Facebook page and shot a little bit of video and stuff, and they had an interesting thing in their outdoor area where they used that. I can't recall the name of it, but essentially it's that that iron which has got a. A pattern cast into it, and it's quite trendy in the last couple of years. But you can. It doesn't have to be. That might. That might have been, you know, 40 mil decking slats was the other method that sometimes you use. But if you've got some kind of canopy method that can be the COVID for an outdoor area that you can plug into the. On the back of the box. On the back, then that kind of obscures any view of that. That the rear of the box, too. So that's another way of kind of concealing the fact that it's a box, you know, lean to.
And one of the great things, John, with the construction method is the fact that you can go higher.
Yeah, that's right. That's right. So there's a couple of options, and it will depend on how your house, the. How the pitch of the roof is on the back of your house. There's a couple of options for the way you attach it, but a builder will be able to tell you pretty quick which way he can get that to work because he'll understand what, what you're trying to do immediately if you show him the plans and he'll be able to tell you how it can hook onto the, onto the back of the house. But there is, I guess there's a couple of caveats there. There is houses where it probably wouldn't be ideal if the ceiling height's really low at the back or, and you're. For instance your roof line is running the other way so it's coming into a gable wall. In that case you could still make it work but you'd have to drop down the floor level because you, you'd be restricted by what your ceiling height was. So there is, there's a couple of situations there where it's not ideal. And the way kind of I get around that is just by shopping for a house that suits the method really rather than. Yeah, the other way around, which is kind of the concept I use with the kitchens and everything as well because I don't, I try and avoid buying anything custom. I build around pre made stuff and that's, you know, can save, you know, 40 plus percent.
I remember when I first met you, John, in a course many years ago and you had just finished one of these and I had you go back and, and look at how you could have saved costs again. And one of the things that you had said was just by changing the size of the butler's pantry, you could have had the pre packed size kitchen rather than the other in order to save 10 grand or something.
Yeah, that's when I got onto that and, and essentially at that stage I was, I was kind of, I thought I'd got my kitchen costs down. I was around at about seven grand with bench tops, which beautiful.
We're talking top end, 60 mil, Caesar.
Stone, that kind of thing. And then what I'm, I can do now is for six grand I can basically do everything like the laundry, the kitchen, the sometimes even vanities and bathrooms and that kind of thing. So it's. Yeah, it saved me a ton.
I think you shared on Facebook the people that you source those kitchens from too, didn't you?
United Auctions. So I haven't used the, the. I think they're in Brisbane and Sydney. I haven't used those ones. I've only used the ones in Melbourne. But I've, I've got mates that are developers, they use them and that's who put me onto them. I know of cabinet makers out here that have basically given it away just to install United auction kitchens because the. Their work just dried up. Because these. You just can't compete, really.
And the Caesar stone is. You get that elsewhere, don't you?
Yeah. So there's different types of. You can get replica Caesar stones. There's. They. There doesn't seem to be any one brand that I've kind of stumbled across. It just seems to be imported from China and different stone masons are kind of onto a different supplier. So I've only sourced that through the stonemasons themselves. But I mean, you know, let me know if you find somewhere.
Yeah.
Share it with everyone. One of the things that I saw someone do recently with the box at the back was, you know, that beautiful big window that you have at the end of the kitchen? Kitchen. So the fixed window actually had a lap pool out the back behind that so they could watch the kids while they were in the kitchen. Nice concept. And that's a great sale point for owner occupiers.
Yeah. And just huge bang for Buck. As soon as you walk into that room and you saw that pool, that would be amazing. I know at our opens, we would have. The mums would just be standing at that window and looking out across the yard and you kind of know.
I gotcha.
Exactly. The emotional hooks.
And that's what we're trying to do with those structural renovations too, is the emotional hook of I want this property, darling. And that's why we're targeting the owner. Occupied.
Yeah.
Yeah, absolutely. So there we go. I think. Why don't we just jump onto Module 9 here on the screen. So we just run through quickly what we have in that so people know what's coming up. So we talk about the demolition and the strip out, which is important.
Yep. So in that case, it was where you're. As you're about to see it was. It was literally the whole thing with the. With the case study. So we. We went from scratch. Didn't require a restamp, which was the only thing that it didn't require. But it was a rewire. It was. All the plaster was stripped off walls and ceiling. And normally that's the kind of first thing. Normally the order would be if you. If you're in that extreme case where you're doing a complete structural renovation where you were gutting the front, you would normally gut that first. Then you would do. You do your restump and then you would Start to do things like in a period house, you'd need to batten the walls before you plastered and, and that kind of thing. But that's it, that's at the extreme end. So you want to, you want to see that there's a fair bit of value there to take on something that extreme.
Before we move on, Rachel, I just make sure that we've answered your question properly or do you have another one? Thanks, Jane. Just with council, just the process of going through council with the box on the back, is there anything that you would just sort of bring to our attention or suggest? Good question.
Pre application meetings are always the best. If you've got. They might have a different name in your area, but yeah, we do have them. Yeah, I just think they're great. Some councils do them differently, some councils do them via email and they charge you a couple hundred dollars or something, something and, and, but they have a set time frame. For instance, I know ban your council here is it has a two week way of doing that. Other councils, I've used you, it doesn't cost anything and you go in and have a meeting with them and that way you can kind of start building up a relationship with the one planner. And I always kind of go in there and just say, you know, you tell me what do I need to, what do I need to do? And I'll just do it. I'm not interested in trying to force anything through and they give you feedback and normally I can then arrange another pre app and go in and I'll lodge then with the same planner and that just cuts so much time out.
Of the process and also having builders that are familiar with that council. So drive around the area as you're doing your research and you'll see their boards up on a wall somewhere of work that they're doing and they might have the architect and the builder or whatever and you grab their details because I mean, they're obviously familiar.
You can, a lot of councils, you can actually look at what plans are in at the moment for approval and often you can actually see the floor plans and the architect and everything there. So it's, it's a kind of good tactic and developers do this is they find out who's, who's getting all the plans through and who's got the relationship, relationships with the council in that area because they get used to dealing with certain drafties and certain architects, decks and certain, you know, whatever town planners. And yeah, it just grazes the wheels a bit, but I should mention, grease.
The wheels is probably not what we're doing. Not financially.
No, no, no, no, no. We don't do that. The thing I should mention is often you'll find you don't need planning permission or, or a DA for. For the box. It'll come under. A lot of councils have a, like a square meterage rule A lot of the time in and around here it's under 300 square meters. Requires planning permission or development approval. Over 300 square meters doesn't. So you need to check that first. You may find you don't even need to get planning permission, but you will need to get a building certificate because it is a structural renovation. So we need to get a building permit, which is pretty academic really. It just they essentially the draftsman takes care of that, lodges it and that normally comes back in under a month. So you don't. There's never a case where that has to be advertised to the neighbors or any of that kind of rigmarole.
Okay. I think I might be out of luck there because I'm working in central Ballarat and there are a lot of heritage overlays.
Yeah. So that would require planning permission. Yeah. So I'll go down the pre app path and you want to find out when the heritage offices officer is in the office so you can have your pre app.
Okay. And arrange a meeting with planning and heritage.
And heritage at the same time.
Yeah, I know when we've got heritage overlay on one of our properties and the heritage person was only in the office once a month, so we'd submit like color schemes and they'd say no and we'd have to wait a month for them to look at the next one to say no again. So yeah, they may not be there when you want them, so just be, you know, do some research first and have a chat to them. Yeah, right.
And I would, I would approach the always with the first meeting is just you guys tell me what to do and then. And then rather than the other way around because you list the stuff you want to do, they'll come back with a bunch of objections. You'll go away, come back, they'll come back with their next lot of objections. It's like you just tell me and I'll go away and do what you say.
Be the person that they walk out of the meeting, go, oh, thank God we have an easy one. This is great. We're going to help these guys get through.
My father in law used to do this. He used to go to the building inspector, hey, I'd like some Advice on something and then you hear from building half the house, you know.
Yep.
That's the way to do it.
Take your plans. Great idea. They can be your friends. Are you better to even like. Yeah, take those plans in and maybe one or two houses that might be on the market but you haven't yet purchased because there's a couple I'm looking at that I think are, you know, viable.
Yeah.
And try and have a meeting just to say, you know, before purchasing the property, find out if viable.
Yeah, absolutely. I'm doing that on a weekly basis. So I go in and say that, yeah, I'm the incoming purchaser, I'm looking to buy this property. And then, you know, going through all the things and often. And we've just found out this again recently is often the. Even though you do the initial, we have a system that we always go through and check the, check the planning and, and, and check all those steps first online. And then we still have that follow up with council because it's happened to us a couple of times where they've thrown stuff up at us that we didn't even know, like a, a neighborhood character overlay or something like this, which we, which didn't appear in any of the online stuff.
Okay. Yep. And just a, just for what you were getting onto with restumping. I've done cosmetic renovations, but I'm a bit of a chicken when it comes to restumping. And I'm just wondering. I just sort of feel like it's a can of worms that, you know, you restump and then maybe you have to redo plaster and, you know, it just goes up, up, up. What's your input on that? Should I be as chicken as I am about that?
No, you should be a chicken where you can kind of lose 20 grand pretty quickly with if it's not if. Are you talking period house or it. What age? Yeah, so, yeah, talking period.
Mainly weather boards.
Yeah. Yeah. The good thing about weatherboards is they're pretty. As long as it's a detached house, they're pretty easy to jack up and move around because they're, they're light enough. If it's slather and plaster, which is the old timber slats with the, the cement or sand and lime render over the top of them and then the plaster over the top of that, you kind of nearly always lose it. There's not that many situations where after you rest up and it might not happen straight away, and then a couple of occasions I've gone, oh, I think I'm going to save this room and then I replaster the, the other rooms. And then when I'm, you know, up to the painting stage, the. It starts to kind of come away because as the wall starts to settle again.
So.
Yeah, be a chicken. I, I kind of, I almost say if, if it's lather and plaster and it requires restumping, it's. It also requires replastering. So there's another 10 grand for that essentially depending on if it's just those four front rooms, which is normally my case.
Right. Okay.
So thank you.
So just factor in that big cost.
Yeah.
And see if it's worth it.
And see if it's worth it.
That's the best way to determine if you do possibly need to rest up. Building inspections or.
Yeah, your building inspector will tell you. It's normally when you walk in, you can feel it pretty quickly. My feet are like radars with grease stuffing. So you get used to kind of walking around and, and what will tend to happen is around if it's a, a timber house, like a weatherboard house, it'll be this. The structures that are solid, like the chimney, for instance, where that will be the original level. And all the rest of the house would have sunk down at varying degrees often. So often if you go into a room with a chimney and walk into the corner away from the chimney, you'll be able to feel that you're going downhill. So that's a good indication that it needs restamping. Now it might be that it does need restumping, technically, but it's not, you know, it might only fall 50mil or 100mil, and you might think that, well, not, not everyone's going to notice that. I think you could still do the work here and it would still be renovated up to the level that I need it to be, and it'd be possible without doing the, the restumping. Solid brick houses are a different kettle of fish. They require if the walls have sunk, which is normally the, the symptoms of that is that it's got large diagonal structural cracking down the wall. They can run into, you know, 20 plus thousand dollars for underpinning on those. And what it is, is the, the walls are actually separate from the, from the floor. In that case, with a, with a timber house, when you jack up the, when you restump it, you're jacking up the whole house. The walls go up, you're jacking up at the bearers and the joists and the, on the wall frames above it, and the whole house goes up and if you've seen them when they've transported homes, they just keep on jacking them up and they drive a truck underneath them and they drive off. But with a solid brick house, it's the walls, and they're separate from the. From the floor. So the floor is timber and that sits on its own stumps and it ties into the walls at the side. But the actual brick walls themselves, if they're gone, they require underpinning, and that's a bit. That's a big job. So I'm always very wary if there's underpinning involved. It would want to be a pretty cheap buy and in a. In a really good area.
Factored it in already in the price.
Yep. Brilliant.
Thank you so much. You know, I've got a list. I can hear it. Just that name again. For the kitchen cabinetry, it was United Options.
Yeah, United Auctions. And it was in one of the posts this week on the Facebook group.
Okay, great. I'll search through and get that. Thank you. Brilliant. Thanks so much for the input and, yeah, I'm looking forward to giving it a try. Hey, we want to see you on the Facebook group telling us about where you buy. Yeah, I'd love to hear what's happening in Ballarat. I'll keep you updated. Thanks, Rach.
Thanks, Rachel.
Thanks.
See ya.
We'll just go through the rest of the content and module. 9 lath and plaster and gyprocking. We kind of mentioned restumping. Electrical rewiring. Yep.
That's got another one where I think of. And again, I'm just thinking in the terms of the type of jobs that I do, but typically for me, where I'm leaving the four front rooms, there's. There's a 10 grand re. Stumping. 10 grand rewiring and, and 10 grand replastering is typical of. Of the kind of thing. And that's been pretty cheap. Now that might be. That might mean 15 grand if you're doing it the first time and you haven't worked out your systems to get the prices down yet. So, yeah, that kind of stuff can add up real quick. So you kind of want to seriously think about that if you're doing it the first time around. Big catch.
Plumbing, tiling. We have a whole section in there about tiling. Don't worry about the.
The difference between porcelain and ceramic. Yeah. So that's the. The whole idea that the porcelain has the highest perceived value. It's what they use in the hotels and all that kind of stuff.
Five star hotel.
Yeah. And it's with the, you know, the porcelain tiles, they're normally 600 by 600 or 600 by 300. They go all the way to the ceiling. And one of the characteristics of porcelain tiles is they're not completely white. They're an off white color. So one of the tricks you can do and, and I mean this is not something that someone would walk in and go, oh, I think this is expensive because it's off white. It's just one of those, it's a.
Mental, it's an unconscious kind of subliminal triggers. Yeah.
So you get a ceramic tile which is, you know, typically 15 or more cheaper per square meter. And you get that in a, in a, in a gloss and in a alabaster or eggshell or off white. Just not white, just not bright white because the bright white in ceramic is like a piece of paper white. It's really quite white. And then you, you can put that to next to a polished porcelain tile and it almost looks identical. And like I say, you've saved 15 a square meter and that's what you put on your walls because that's if you are tiling and we're talking, I don't know, there would probably be a point there, we'd say sub 500 grand resale level. You probably wouldn't be doing this. You'd just be doing your normal tile and paint your tile around the bath and your tile around the kitchen, the shower, and then just, you know, maybe a skirting tile or something like that. But in this case where you're going all the way up to the ceiling and perhaps if you've got an ensuite as well, that can save you thousands of dollars alone going with ceramic instead of porcelain and, but have that really high end look different on the floor because you haven't got typically, you know, if you've got a, a small bathroom, you know, that's a couple of meters by a couple of meters, it's not, you know, that's not many square meters to, to do. So it doesn't cost much to do a floor. Most developers use polished porcelain on the floors. Now there's a debate around using high gloss ceramic on the floors, that it's too slippery and it's dangerous. You know, some people, some tile shops will tell you that it's not the case. I, I tend to err on the side of caution. I just go with.
Especially for a rental.
Yeah. Oh yeah, yeah. So yeah. And there might even be cases depending on what level that you are that you don't need to go the polished porcelain on the floor.
Exactly.
Yeah.
Which brings us to the bathroom. We talk about sequence of work, but one of the things I noticed there was a photo that you took at that property you were at on the weekend where they had that fixed window.
Yeah.
In. In the bathroom. And that was a really clever technique in saving some money. Not putting in actual window frames, but actually just putting in a frame.
Yeah.
A bit of glass.
It is. I use it quite a bit. Just getting the carpenters to put an opening in and literally just getting a bit of safety glass and plugging it in and then you know, plastering around on the inside and flashing it on the outside and that's it. I use that for skylights, for fixed windows and bathrooms for highlight windows. It's just, I mean glass is just such good bang for buck. Instantly adds the light. Yeah, yeah. So in the lighting. Yeah, it's really. So it's quite inexpensive. So if you can do that, it's a really cheap way to put a really large skylight in.
And even the around in that box in the back, the around the top section.
Oh, is yet my.
Your home?
Yeah, at my place we've got that on my box. So we've got like a pop up section in the middle which has got. It's done with steel. It was about. It cost maybe 10 to 12 grand to put that on. But it really is the main feature of the house and everyone kind of comes out into the back area and yeah, just you know, takes a breath because you've got the. A kind of pop up roof which is the central section of the lounge room which has got glass on all four sides and it just lets a huge amount of natural light in. And I think it's that natural light which just instantly looks, you know, expensive. It's that perceived value.
I wouldn't be doing that on properties under 800,000 or so. We're talking high end here, guys. The kitchen solution, we kind of touched on that a little bit before.
Yeah, that's. And I think that's just a concept that I carry throughout. If you always try and use standard sizes and build your walls or if you've got the opportunity to do it. I know in a cosmetic renovation it's far more difficult, but try and think of ways that you can do that. It might be building a little, you know, stud wall at the end or which then could become a, I don't know, like a wine rack or you know, a place that a small desk could come off or Whatever. If you can put a solid structure, which is timber and plaster essentially, that can allow you to use standard sizes and have the room fit the standard size, in other words.
So we're not talking about custom made kitchens here, although we want the high end finish. And naturally most people think, well, I need custom made to give that high end. The reality is if you can get the pre pack right size and cut down the cost, but it still has that fin, that great finish, then you've got the best of both worlds. And that's, that's the kitchen solution there. And in actual fact, the pantry, the butler's pantry as well is something that you just have as part of the box, the back, don't you?
Yeah, so that's exactly that. So the, the butler's pantry, I will just use an open cabinet in the butler's pantry, which is just melamine finish, depending on what you are. I, I was on that, that example there. We used a laminate top in that, which was just in the same look as the, as the Caesarstone top, which the finish was like an osprey type finish. And it's just open cabinetry. And the thing with cutting down a kitchen to size is it's, it's not the cabinets, it's the doors and the end panels because that's what, where your two pack or your vinyl is. And it's just, you can't do that easily. It's not easy, not an easy thing to do. So what you do in the, in the case of the box on, on the back is you start off with a, a pre made kitchen which is a certain size. You bring the pantry wall out to kind of butt up against it. So you now have a room that's the size to fit the kitchen. And then on the inside of the butler's pantry, use open cabinets which can be cut down to size for 60 bucks or whatever. Just get them to do it. And, and that's the way you kind of solve that. So you make the room fit the kitchen.
And the butler's pantry doesn't have its own plumbing. Doesn't.
No, not, not in that case. But people do, people do put second kitchens in and all sorts of things these days.
I've seen some amazing. Yeah, butler's pantries are bigger than my kitchens.
Yeah, well, often they have fridges and another sink and all that kind of thing. But again, it just, you know what, what your demographic needs and what you're renovating up to.
Exactly. And then the box at the back, which we all know and Love and well, you're going to get to love it. I love it. Now, John, the actual construction and we talk in you know, capital city construction of the actual box not including the fit out. What are we talking? 90, 100?
It's hard to say because it in. It depends what you're finishing up to. So if you look what's in the box on the back. If you had nothing else to do the, the rest of the house, you've got your kitchen in there. You've got a fireplace. Ideally that's the way that I do it.
Stack of glass.
You've got your stack of glass and then a couple of fixed panels. And I'm still not. That one that we went through on the weekend that was using the, the windows splashback, which is. I explain that well, it's instead of having a fixed like a fixed panel of or glass splashback which is not see through, you actually have a bit of safety glass in there which is has to be if you've got a stove against it by the way, it has to be heat rated and all this kind of stuff. But you can look straight through the splash back out into the backyard which they've been using in the estates and everything for ages. Every time I've mentioned that I was going to do that on the next renovation, Eileen kind of always shoots me down and says what a bugger it would be to clean and you'd see everything and all the rest of it. And she, she's convinced me that other women will be thinking the same way. But I continue to see it like I did on the weekend. So I kind of might just ignore her on that one.
I tell you what, ignoring your partner might be something that we, we wouldn't authorize here. But I have to say my sister put in a mirror splashback.
Yeah.
And that looks fabulous. And it would have the same issue, but it actually makes a small unit look really huge.
And was it a tinted mirror or was it the.
She used a tinted one. I actually have a mirror splashback in my unit in Bondi beach. So to reflect the beach.
Right.
As well.
So is that a tinted one?
No, it's actually just a mirror.
Yep. Yep. So yeah, I really liked the. Because I'm using white cabinets. I've been tempted and I haven't done it yet. But to use there's a, a gray tinted one which, which looks really good. It gives you nice contrast between the white cabinets and the, and the mirror. But you also get the reflection. So it looks really nice.
And I think the darker, it probably covers up a bit of the, the oil on the splatter as well. Yeah, maybe. Okay, well I think Lorraine has actually left us a few questions this week. Now she's just said that she thinks some of them might have been from previous ones that she hasn't had a chance to listen to. So take it away, Lorraine.
This one's on suburb corporation criteria.
Lorraine, my question is the biggest issue always for us is to find the area that is going to perform very well. And I know through modules two and modules three you give lots of hints and tips of how you go about that. So myself and my husband Greg, you know, we are under a little bit more pressure because you know, we're in our 50s, so whatever we buy needs to have great growth and great rent return. The question is, do you need, do you take into factor that you've already got so many houses in New South Wales and that, you know, land taxes and things like that needs to come into the equation? Or when you go looking, you're just looking for that right area and just in very quick point form, I know you've got it in your modules, but just how you would go for a procedure in regards to looking for that area. So you say you're going to pick New South Wales, you look at your Residex reports, you look at your previous data as far as growth etc. And is that how you do it? And would you use all of the things in module 3 as in you go to my RP data, go to every one of those to do the research. Would you just pick a couple of those to check out the information regards to the area. Anyway, that's probably a long question. Virtually it is just in the pint form how, just to have a bit of a checklist when these calls are over, how you go about really pinpointing that area. Because that is our biggest thing always. It's always like how do I find that area? Thanks, bye.
I think we should ban Lorraine from now on. Well, I should prepare better.
Who else is going to use the line?
Oh my goodness, that is a huge question. Okay, let me cast my brain back to module two and three. Lorraine. First up, let me just say that I would encourage everyone, regardless of their age and the size of their portfolio, to have the absolute same due diligence and concerns about buying the right property in the right area for the right growth and the right rental return. Just because you are 30 and you're buying a property doesn't mean that you can go, geez, get it wrong because I got 20 years for this to make me look like a superstar. So, you know, this course is around everyone, regardless of their age and their position to go. You know, I'm going to be using up my borrowing capacity on a purchase and I'm going to be using up, you know, my time and effort to buy something that is going to grow for me. So regardless of your age, I encourage everyone to have the same focus that and concerns that Lorraine has in finding the right area. Because that, I mean, as you've seen, you know, the first six modules of this 12 module course is very much in our mind of finding the right area. So first up, Lorraine, thank you for that question and the opportunity just to remind everyone how important it is regardless of where you are in life. Moving on to, I guess, the procedure and the breakdown of where to start. I really, I think you should start without being overwhelmed with this 14, 16,000 suburbs. And I have to consider it is, as you said, be realistic in the sense of are you going to manage the renovation yourself or not? If you're going to manage it yourself, it's going to be within maybe an hour of where you live. So geographically you might limit it straight up. If it's not, then you really do have the opportunity to look in all the areas and then it comes down to your borrowing capacity. So you need to understand what you can afford. And I encourage you to go to investorschoice.com and have a look at that property plus calculator. Please use Safari or Chrome to open it. It doesn't work in the other browsers, but what it does is it allows you quickly to put in your net income that's after tax, put in your income, get up with a basic borrowing capacity and if you've had a spoken to a mortgage broker or a bank and you know what your borrowing capacity is, just put down your borrowing capacity. You don't have to recalculate it, just subs it in or go to the next page and then indicate where you're interested in looking, what state, etc. And what it'll do is it will come up with the hotspots, not the hotspots, it'll come up with the surrounding areas in that area that you're looking at. So you've kind of got a picture of the surrounding areas and their past growth. So it's a starting point for you. But borrowing capacity is one of probably the first thing that's going to cut down where you're going to start looking. So if you're going to manage the renovation yourself. You might say, within an hour of home, my borrowing capacity is $450,000. Therefore, of all the property, all the suburbs, an hour from home, I'm really going to target this area. And John and I spoke about this last week in, you know, if you're doing the heat map, then, sorry, the dot map, it's really important that you do it for the whole area that you're looking at the whole city, for instance, of Sydney, Melbourne, Brisbane, Perth, Adelaide, Hobart, Darwin. Because by just targeting just a little area, you might lose some opportunity. Or when you come back in the future and you're looking, your criteria is different, you might miss out. So if you're talking about buying in Sydney, for instance, do the dot map for Sydney, then target down to the real. I think an hour is realistic, don't you think, for managing a renovation you can add that kind of criteria on? Your next criteria would be your borrowing capacity. So work out from those suburbs your borrowing capacity, because you're going to wipe out potentially half of them. Remember, your borrowing capacity is based on not just what you can afford, but the cash you have to contribute. So if you've got 100 grand to contribute and you got a borrowing capacity of $600,000, then 100 grand, 10% deposit, 60 grand, stamp duty might be 25,000, that's $85,000. You've only got 15 left for a reno. It might mean that your borrowing capacity or what your purchase price is, is actually reduced by the cash you have to contribute to the renovation as well. So just be sure that you understand what your purchase price is. Then have a look at the median values within the area that you're targeting. And then go into the stuff in module three and start looking at, you know, what the past growth has been, what is the potential in the future? If you can get the future growth information, what the demographic is, by then you would have probably decided whether you're looking at a flip or a buy and hold. So then you start looking at, well, what's the percentage in demographics of owner occupiers versus renters? So then you start doing some of that demographic stuff and this is how you target it, Lorraine. So don't get overwhelmed by, oh, my gosh, there's so much criteria. If you need to have a blueprint of. Where do I start? Well, look, if you do have a large amount of property in New South Wales like I do, I think my land tax bill was like seven grand last year or something, it does affect your cash flow. So I wouldn't be buying in New South Wales at the moment, but that's me personally. So for you, if you don't have that exposure, not such a big deal. So it is a consideration you could make from a cash flow point of view because remember, it all goes back to, to your goal and the time frame you want to achieve it. So if you're in your 50s, you might be giving yourself 10 years, 10 years of having your cash flow eroded and the ability to purchase more because you don't have the cash flow and means that you're limited by buying in the one state. Then don't buy in the one state geographically, spread it around. I think very much the market commentators I'm speaking to at the moment and talking with, and I've spoken to a couple in the last few days are definitely, you know, there's still going to be some, we're talking now, you know, May 2014, there's still going to be some growth in the Melbourne and Sydney markets. Not as much as there has been. There's going to be more growth potential in the Brisbane market. We've started seeing Adelaide speaking to Peter Cool, property professor. There's been some movement in Adelaide, in Darwin, Western Australia. Perth is coming off a little but Hobart still doesn't have guys the economic guess fundamentals to have the huge growth that the other states have had. However, you know, I do have clients down there who are making some good money out of renovating their home and moving to the next. So you know, Lorraine, in essence what I would say if you want a procedure is do you choose your state, choose whether you're going to renovate it yourself or not. And that's a virtue of, you know, where you're going to be looking then target doing the heat map we talked about. If you're doing regional areas, the heat map is not, or, sorry, the dot map is not going to be as specific or as important because you, you know, you're going to be targeting towns. So if you're going to be going regionally, you're looking at some of the future growth, you're looking at the potential for growth, et cetera. You know, we've had a chat to some of the people in Hunter Valley recently. This week there's been an announcement of 500 miners losing their jobs in Singleton. There is a flow on effect of that kind of thing. And we've always talked about, you know, looking at plan A, B and C and understanding what having A, an area that has a multi industry Kind of economy rather than one economy. So you know, you looking we're talking to people recently what Mudgi Dubbo, some of those larger regional areas, Bathurst Universe, they've got the universities, they've got the education, they're supplying the some of the regional towns, you know, so you know there's some dynamics around there that's just New South Wales once again going to Queensland. You know some of we've definitely seen Gladstone pull back but you know you've got the Mackay and you've got to some degree, you know the tourism industry has been affected greatly and you know we've got cheap properties going in Cairns and Port Douglas and in those areas. But you know, I caution you to understand that that is one market as well, that tourism market. So you know, just be aware of how the Australian dollar plays out with that and, and what's going on there as well. So you know looking at the multi industry kind of regional areas might be where you start concentrating but yeah pulling it back into what your time frame is, what the cash flow you need what you can afford as a purchase price based on what the funds you have from the renovation and then start doing your due diligence because that way you can start narrowing down the number of steps suburbs and not being overwhelmed.
That's great. Yeah, I know we, we talked a lot about this when we were putting together the exercises for module two and module three. You know, suburb selection and suburb due diligence exercises and there's is a little bit of crossover. We, we made some decisions to pull some of the content out of module two that was specific to you know, really searching getting down to the detail. So module two wasn't overwhelming but there is probably times where you'll get down to even when you're narrowing your list in the process scenario list where you can jump into module three and grab some of those, those things like yield and days on the market and all that type of stuff and and use that to help shape your decision.
Yeah, absolutely. Okay, hope that helps. We'll. I know we've got a few here from Lorraine. Let's see if anyone's got their hands up for the moment. Rachel wants to see a photo on Facebook of your your pop up my.
Box in the back.
Sure, no problem. We can do that and.
Oh okay. But yeah so I didn't get to the what does it cost? So I avoided the cost of the.
Box at the back. Yeah it's so the actual box.
So just the frame. If you didn't have any kitchen and Stuff in there, I think mine, my build like timber and the builder was under, under 60 for mine. Now how that applies to someone doing it the first time, I'm honestly, I'm not sure. But by the time.
20.
Yeah. Yep. So you're going to need to. And if you look at what's in it, if you, if you just had that, you've got the, the frame, the cladding on the outside, the roofing, the plaster on the inside, the flooring and the floor polishing and. Yeah, and, and the painting. And that's before you add in things like your, your, the cost of your windows and, and your pantry and the cabinetry and the fireplace. I like to use a, a gas fireplace. I use typically a gas stone fireplace, which is a stainless steel one. That alone is probably 6ish. No, sorry, no. The expensive ones are six years. This is a knockoff and it's 3ish. Yeah. So but I think it's three and a half by the time it's fitted and everything. But again, it's that central. Yeah, it's the focal point of the, the lounge room. So it's, that to me is worth it.
So if we said 75 for construction for a first time, maybe, you know, four or so for the fireplace, the, the, the windows, etc.
Yeah, yeah, yeah. It was around about, I think all of the windows were around that. I think there are six for the, yeah, it was about six and a half for all the glass. So the end window at the end of the kitchen, the, and the two stackers. So I had stackers on the corner, one going one way and one going the other way. And they were both about three meters each. So it was about six, six and a half for all my glass. Because I remember the, on the previous renovation, I just done a bifold. This was before I got onto the stacker idea. And it cost me six grand alone for the one bi. Fold where I was able to do three windows when I went to that industrial aluminum, black aluminum stacker. Yeah.
So if we said what, seven for the construction, four for the fireplace, eight for the windows, eight for the kitchen, two for the pantry.
Yeah, yeah.
So we're at 92.
Yeah.
I've definitely seen people do a whole structural renovation. They're back for double that with the, without the, the look. So. Yeah, I, I, Yeah, people do.
I mean, when you see homeowners do renovations, they're lucky to come away with change for 400 grand.
Yeah, exactly. I saw a box at the back that cost 6, 650 recently, so, you know, which is essentially exactly the same. And so, yeah, we're talking under a hundred and we're adding in a bit of margin there for first time, not being able to negotiate down and use everything. But you guys are going to have, you know, some diagrams of what you can use. I mean, obviously you're going to have some working diagrams and costs that you're.
Going to need to get your quotes. And again, it's just the same process. It's just you're getting a quote for a larger task in this case, which is the builder quoting on the box. But yeah, you can do if you just get them, for instance, to quote on the box to get it to lock up. If you can get that kind of arrangement with the builder and maybe they'll let you handle the. The putting the kitchen in. And at the very least you want to be able to supply the kitchen and. And potentially the floorboards and. And the fireplace and that kind of stuff. Yeah.
And we now have our trade card to get our discount.
Yeah.
Electricals.
So there's some good packages there for the kitchens, which I saw the hubby Norman commercial with the stainless steel kitchens.
And be keen to. This is the appliances you're talking about. Yeah, and appliances, sorry. Potentially there could be a gas fireplace in there too.
Yeah, I haven't seen one yet.
I might have to have a chat to Viv, see if she can go negotiate one for one. Okay. So, Rach, great. She said. Thanks. Lorraine's got another question here. Let's throw over to Lorraine.
This question is in regards to infrastructure, jobs, income. Where do you go for that information when you found that area or when you're considering those last, you know, couple of areas that you're interested just.
Yeah.
Where do you get that information from? Thank you.
To ask easy questions.
There is, if you. In those PDFs, the. The module two and module three exercises. There is some links in there to some of that stuff. A lot of it comes down to the individual councils.
So head to the council. They have so much information, especially with their big plans as well.
Yep. ID is the other one. ID and Atlas, which is the same mobile. They grab their kind of a collater for some of that stuff. Not every council is included in. Is it id.comid.com Yep.
I subscribe to them and get some really good little demographic information as well. But look around their website. The, you know, Google large infrastructure jobs as well. Often there might be big announcements that are made that you want to have a look at, but we Were just talking to the CEO of Ripe House, Jacob Field the other day. He's generously allowing our ambassadors to trial his product, which is a great. Gosh, it really fits so nicely into what we talk about. But he's doing a personal, would you say evaluation of all infrastructure projects over $10 million. And he's actually calling up the local areas, businesses, cafes, news agents and saying, look, I'm interested in investing there. I just wanted to get a feel for, you know, what the major industries are and what do you feel about the new Westfield, whatever it is that's happening. And he's very much hands on. I'm really keen to see his report when it comes out. Another person who does fantastic reports is Terry Rider from Hotspotting. He actually does infrastructure reports and talks about what's happening around the country. But for a cheap way of monitoring, this is looking at the property magazines. I know last month Australian property investor did a whole section on the new transport that is going to be, was being projected for Brisbane, you know, and, and you know, trying to keep up to date with that type of information is important. And if you're looking for a specific town and it might be, I don't know, Oberon, then put it in Google alerts because every time that something comes up in that area that you're looking in, then you're going to be alerted via email. And if you're really keen on a specific area, let's say you're looking at investing in Kalgoorlie, for instance, ring up the Kalgoorlie newspaper and ask to subscribe to it. And it might just be a one month or two month or three month subscription. They'll post you the actual newspaper. But it gives you an idea what's current and what's happening. And that was the old school way that I used to do it. But the reality is these days that you can actually subscribe online to a lot of these magazines and newspapers. And here's a little tip for you to save some money. Always into saving money is go to your local library. They have an incredible resource in most libraries and it is all the newspapers from around the world online for free. So as a member of your local library, you go in and say, you know, do you have access to newspapers? And I have seen so many regional newspapers on those free listings and just flash through it. Have a look, have a look what properties for sale. Have a look who's renting what. Have a look at the major infrastructure jobs. You know, is the abattoir cutting back or is it increasing? Did it get a contract? That is gold. That's what I would do.
Yep, that's a good tip. You Keith Mewes does that too. Gets a lot of his property information through his local library.
Yep.
All the magazines get delivered there too and you can ask the library to subscribe to certain publications.
When I did my budget like 12, 13, 14 years ago, whatever it was, and I started noting down where I was spending my money, it was on books and magazines and I joined the local library and cut out like 50 bucks a month. So, you know, for a dollar you can go and ask them to get put your name down for the latest release of some main book and there you go.
Yeah, that's a good tip. All right, Lorraine, we've got another one. Let's have a look. This one's about past interviews.
My question is I've been listening to your previous Q and A calls and sometimes Jane, you say that you're going to put up, you know, it might be an interview that you've done with somebody and you know, they've bought numerous houses at low cost or you know, different spreadsheets or whatever. I'm just wondering where they may be on the renovators network, Facebook or you know, in one of the modules or something. Just some of those things sound like they'd be very interesting to listen to. So.
Good question.
Yeah, if you could let us know.
Obviously I'm over promising calls that you.
Have recorded listening to them and sometimes you might suggest that you will pop them on or pop them somewhere to be able to get those so that people can listen to.
Thanks Lorraine.
I think good time to let people know that you've got a website coming out shortly.
I do have a website going out shortly. Yourpropertysuccess.com we relaunched I think in June with all of the resources and things on it. Look Lorraine, pretty much everything that I promise I try to deliver and I think I do deliver, I think the one interview that I talked about that I haven't put up, and that's by virtue of the fact that we've been waiting for this fabulous studio to be established, is an interview with a low income earning family who've been able to build quite a large property portfolio by buying a home, renovating it, pulling the equity and doing it again. So that is an interview that I have on my list that pops up weekly on my to do list, Electronic Juice it says record this interview. Other than that, all the other interviews and and PDFs articles they go up pretty much straight away. So everything should be on the bonus section of the course. If there's any actual articles that are outside of that that I mention or talk about then they would go up for to. To the Facebook page. But other than that there's.
You normally post when you've got a. You say I've just done an article in such and such. Yeah. Yep. But the. Why I was mentioning the website is where at the moment we're collating a lot of your past stuff which is going to become some content on the new website, which is kind of more of a blog based website than the previous one. I'm talking about YourProperty Success.com.
How professional that sounded. But the. Yeah, I think we've. I've just gone through and collated the last. Well since 2007 when I started writing for magazines, I think I've got like 400 articles that I've written or. And often magazines will say, you know, Jane, we want to have a question. We want to talk to you about the different. What are your thoughts on the differences of buying units versus houses? And I might write a 600 word article and they might use two or three comments from it. So there's a whole lot more information that hasn't been distributed that we want to get to you guys and, and we really want to make sure that there's available rich content and information that's free for people to go to at any stage.
Yep.
So Lorraine, that's where they're going to be that information and I do promise that I will do that article. I've teed up the person and once I learn how to, to make it all happen with John Self, it's all going to happen. So expect that soon. I think that brings us to. Is there any other questions? Oh, Anisa's got something here she wants to tell us. She wants to see that interview. Low income family. Yes. Yep, absolutely. And look, you know, I've been speaking to quite a few people in Investors Choice the last couple of weeks who are. They're doing a bit tough and you know, looking at making life a bit easier for the family going forward and putting, you know, some of their money aside to making the investment in property and it's just really important guys that when we're looking at making a property investment, you know, I'm definitely coming from a point of view that the reason that I share my experience is that I know that, you know, with one or two properties that you can actually get to the end goal that you want to achieve. You can create wealth and freedom of choice for your family, and you can do this in a low risk way. And it's all about buying the right property in the right location. I believe adding equity through renovation is a key to be able to do that really quickly. But for me, it's really important that you know it's possible and you're not risking everything in doing it. It's being really, you know, it's getting it right.
There's a lot of work. I heard it described the other day as a bit like, you know, it's, it's kind of pushing the, the train carriage on the, on the track. And it takes a lot of energy to push it the first time, but once it gets rolling, it will go under its own steam, you know, start, roll.
And for those who are just starting, absolutely, the first one is the hardest. But you get it right and you learn these processes, you learn the procedures, you learn the way to do it. The next time is just going to be so much easier. And I have never, ever bought a property without having buyer's remorse. It's like, oh my God, what have I done? I don't think that everyone thinks that they've got it right. Everyone has doubts. And if you can go back and go, is it the right area? Is it the right price? Is it right for the right demographic? Do I understand the structure, how this fits into my portfolio, how the portfolio fits into my goals and the timeframe? Answer those questions and it's a done and dusted, in my opinion. Okay, well, gosh, I'm gonna have to wrap things up. I'm feeling a bit sad, actually. Josh, we're out of time. We've had some really great questions. And guys, I really appreciate the fact that you've been engaged and we have so many of you on these calls so often. The last eight weeks have been fantastic. We are here to help you out. You're a wonderful group of people and you're trying to aspire to a greater position for yourselves and your families. And that's what we're all about, is giving you the information to help you be part of that. So I know I speak for John when I say it's so satisfying to work for people like you. And you're intelligent, your self starters, you're motivated people. You're just trying to get ahead. And we see that on the Facebook page. I, late at night, look at the Facebook page and just go, this is just fabulous. This community of people who are here helping each Other out just sharing resources I haven't seen in any other property group that I've been part of.
So yeah, I think it just gets better and better, doesn't it? I mean, it started with our fantastic beta testers and they kind of bonded straight away and really kind of, I think, laid the platform for what's kind of become a fantastic community. Really.
Absolutely. And we just really encourage you guys to use and exploit those resources and exploit's probably not the right word, but, you know, get in there and be active and be vocal and share some stuff and if you haven't been problems, you know, let us know because as a group where we're here for you and we really want to make a this course better for the next group of people and have you out there telling people about it and your family and friends seeing the differences that businesses are making in your lives. And I know sometimes when you kind of fixated on buying property and your family and friends have got other things on their minds, you don't have a group of people you can talk to and bounce ideas off and feel part of a group. And that's what this is about. It's a safe community. You can have the conversation about what you're trying to do and what you're trying to achieve. And that's where we are. So it's not goodbye just yet. Look, John and I are in the Facebook group and please keep in touch, update us on what you're doing. We really, really want to hear about your successes as much as we want to help you out with any issues that you have. So as I said, be actively involved in the group over the next four weeks as the modules are released. We're going to be there. If you have any questions, any concerns, anything, let us know. This week's Q and A will be available within 24 hours in the Q and A section at the top left hand side of the Ultimate Guide to Renovation website. And as always, if we disclose that information or you've disclosed any information that you don't want recorded on the call, let us know asap. So we'll be editing that out right now. So tonight's module nine. This is the structural renovation case study. This is. Wow, this is bling bling. As much as I love module 8, that big reveal of the cosmetic renovation, module 9 and the structural renovation is kind of a step apart from anything else that I've seen out there. So we're just really, really excited to show this to you. Module 10, 11, 12 will be coming through in the next couple of weeks as well. So module nine is going to show you the systematic way to carry out a structural renovation from start to finish. You know, we're, we're back on site where we're doing things, we're showing you how it's done, we've got some great video content and some really great resources there for you. Use them, have a look over them, see how they apply to yourself. You know, some of you may not have decided whether you're going cosmetic or structural at this stage. And this is an opportunity to weigh up in module 8 and 9. You know what your strategy is so you can go forth and then use all the stuff that you've Learned in the first 6, 7 modules to locate the right property for you. So don't be overwhelmed. There is a property for you and you know, when you've set your buying criteria and you understand exactly what the property needs to look at, look like to fit into your long term goals. Seriously guys, you'll be seeing a deal a week. So you know, when you do the numbers, you do the budget and you understand where the profit is, you can decide whether to make an offer or walk away. So don't be overwhelmed. But yep, that's what we're here for. Got any questions? Facebook page. John? Yep. Goodbye from me.
Yeah, goodbye from me too.
Okay, all the best, guys.
See ya.
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