When to Renovate Unit? Now or Later?

Blugok on 08/09/2017 - 17:20

So I bought an Invesment property a few years back. Currently still tenanted.
We are planning to move in early next year.
But I think it requires some renovations (wall repaint, carpet to floorboard, maybe renovate rooms and bathrooms if budget allows)

this will be my first time getting a unit renovated… so zero exp

Questions/Options

  • Should we start getting it renovated now for tax purpose?
    if yes, to what extent can we renovate the unit without bugging the tenants that much? Rent compensation is on the card obviously.

  • Should we renovate after the unit is empty? Then move in after renovation finshes
    I cant see the benefit with this option. No tax benefit. And essentially pay both current rent and ip mortgage.

  • Move in first and renovate bit by bit?
    No tax benefit but saving on paying just one mortgage.

Ideas, suggestions are welcomed
Maybe some help on what budget i should prepare?
Repaint
Flooring
Etc etc

Thanks

Poll Options expired

  • 0
    Move in first then renovate
  • 3
    Renovate now while tenanted
  • 17
    Renovate when empty then move in
Home & Garden

Comments

  • thechemist on 08/09/2017 - 17:26
    +1

    No tenant in their right mind would let you renovate when they are there (never had a rental agreement that had a clause to allow this), I think your property manager would not even think about asking the tenant that

  • good grape on 08/09/2017 - 17:27
    +1

    If you plan on DIY, move in then renovate.

    If you plan on tradies, renovate when empty. You can't paint walls and change flooring with tenants and all their stuff. Probably could strip out a toilet tho if there's two.

  • citygal on 08/09/2017 - 17:30
    +1

    You may need the tenants' consent to renovate if you want to get the work one while they live in the property

  • TheBilly on 08/09/2017 - 18:55

    Budget depends on if you DIY. I think you can effectively save atleast half by DIY. Tradies charge through the nose.

    Also, I think if you earned income in the financial year it is considered an investment for that year, so carrying out the works will still count as a deduction for you - and will be offset against the income. You have to be careful on the value though - because I think you can technically only deduct "Repairs and Maintenance" up to a certain value. Expensive renovations or upgrades are depreciated over their allowable life, not deducted straight up against your income. So it might not even matter as while you are living in it, you cannot depreciate it over its useful life.

  • chumlee on 08/09/2017 - 20:50

    If you are going to move in early next year the tax deductions will amount to very little by doing the work now. Do it when tenants move out

  • Blugok on 08/09/2017 - 23:17

    sorry, just to be clear. My renov plan means hiring labour to work on it 😁 No plan for DIY

    Yes. I know i know its probably not that hard to paint or replace carpet
    No need exp. just need to learn a bit and stuff

    Just thought i have other better things to do as i have zero interest on those things

    • garetz on 09/09/2017 - 09:10

      You have 0 experience, why do you think professional carpet layers and painters exist ? if its so easy and anyone can do it, then their jobs would be extinct. It's not as easy as you think.

  • Euphemistic on 09/09/2017 - 19:43

    If you plan to live in it, save the renovation until just before you move in, otherwise you might be d up needing to do it again. We completely painted a place before letting it out and about 6 months later it looked like it hadn't been painted in years.

Login or Join to leave a comment
Login Join