As published by Herron Todd White Valuers
Renovation has always been popular in the Toowoomba area, particularly in uncertain financial times when the market may feel safer to invest funds into their existing property rather than buying or building a new property. With the large supply of housing currently at hand and some cases of reduced prices, owner occupiers could consider buying into a newer property instead of renovating.
The majority of renovations will be found in close proximity to Toowoomba’s CBD in established areas such as South, East and North Toowoomba and Newtown. Further out from the CBD, Centenary Heights, Rangeville, Mount Lofty and Harristown have also seen many renovation projects. Typically, areas further from the CBD are characterised by modern housing. As a result, there is less demand for property to be renovated.
For house flippers, the right price must be paid for a property to then renovate without over capitalising. Care needs to be taken when considering the true costs and the time it takes to renovate. Newtown homes remain popular with first home buyers as they offer a blank canvas opportunity to add value. The market for these homes once renovated also remains active with the more affordable price point in Newtown compared to the eastern suburbs proving attractive to some buyers. Early 1900s colonial homes around East Toowoomba traditionally command premium prices. They are often located on larger lots in sought after locations and ideal for upgraders looking to add extensions with their renovations.
The opportunity to buy dwellings with renovation potential across Toowoomba is endless with buy in price points ranging from around $200,000 to $500,000, depending on the area.
An example of this was an original, two-bedroom timber cottage which sold in May for $205,000 in the inner suburb of Harristown.
Another example was an original, three-bedroom timber cottage on a double block which sold in May for $485,000 in East Toowoomba.
Toowoomba’s heritage and colonial homes are synonymous with the Toowoomba property market Month in Review October 2018Residential 48 with heritage conservation guidelines sometimes limiting their removal for higher uses such as units and townhouses. This further entices owners to renovate existing colonial homes.
The current Toowoomba market in most cases does not reflect large gains on renovation projects. Some locations and property types may in fact show a loss, some may break even (dollar for dollar) and some may show small gains. There are many factors contributing to this such as holding costs, transfer costs, and labour costs. Overall, it can be difficult to find a renovation project in Toowoomba that would make a substantial gain, however the renovation market is highly active and can provide enhanced lifestyle and locational benefits beyond pure financial gains.