Selling a home: Do you renovate or not?

Renovating your home is no guarantee on a massive return in value. Photo / Getty images

Sprucing up your home before putting it on the market is no guarantee of a massive return in value.

New stats from property information site, homes.co.nz, showed properties sold in a "good condition" went for as little as 0.27 per cent more than one of lesser quality.

This was the case in Sandringham where over the last 12 months these properties sold for as little as $3,628 (0.27 per cent) more than a house in a "not good" condition.

Other suburbs where renovations appeared to add little value to a property - reflected by a less than one per cent difference in sale price between "good" and "not good" properties - were Massey, 0.29 per cent, Opaheke, 0.7 per cent, and Birkdale, 0.9 per cent.

All, barring 15, of the 41 suburbs analysed saw a less than 10 per cent rise when a property was sold in a good condition.

The one suburb that saw the highest change in sale price between properties in good condition and those that were not, was in the affluent Waiheke suburb of Oneroa, which had an average sale price in the same time period of $1.65m.

Over the last 12 months good quality homes sold for an average of $2.05m, a jump of $788,551 (62.66 per cent) from properties deemed to be of lesser quality.

The average sale price across the suburb was $1.65m.

Homes.co.nz classified properties as being in a good condition if Auckland data records had marked both its roof or walls as "good".

Those which had roofs or walls deemed to be poor, fair, average, or mixed were considered to be in a less than good condition.

Spokesman Jeremy O'Hanlon said there was benefits of presenting your house in as good a condition as possible when looking to sell.

"Homes that are renovated with a target buyer in mind can create more competition for the home and thus achieve a price premium."

However, he cautioned it was important to do your homework before diving into a huge renovation project.

"It's very easy to spend on what you feel is important, but won't create a return when it comes time to sell.

"Consider carefully who would be wanting to buy your home before investing heavily."

He said renovated historic properties, those dating pre-1940, were the most likely to attract a higher price.

"The biggest uplift was seen for properties built between 1900 and 1910 with a 49 per cent price premium.

"These are dominated by renovated villas in Herne Bay, with a 50 per cent premium, and Freemans Bay, a 40 per cent premium."

Property Institute of New Zealand chief executive officer, Ashley Church, said the impact renovations had on property was still largely dependent on the state of the market.

"When the market is depressed then renovations are everything and can make a difference between getting a reasonable price on a property and not getting one at all."

He said when the market was quieter people tended to look closely at what they were buying.

"But during a boom period, it's all about getting in as quickly as possible ... renovations become meaningless."