Irrespective of why you choose to renovate your own home,
the most important underlying factor must always be the enhancement of its capital value.
The writer of this article is a CPA of Australia. He has worked in one of the Big-3 international Accounting firms and has developed and renovated numerous residential properties in Australia.
As I write this article, home owners and real estate investors are facing the most challenging times in the history of home ownership in Australia.
Real estate prices are trending at historic highs in Sydney and Melbourne, two cities which I consider premier and the most cosmopolitan in this country. National wage growth is practically stagnant while household debt to income ratio is riding precariously thin. And despite a string of rock-solid economic credentials – inflation of less than 2% per annum, unemployment rate averaging at a respectable 5.5% for the last four years and annual GDP growth of around 3%, interest rates are at 60-year lows of 1.5% and is forecast for at least another cut in 2017.
Notwithstanding the fact we like to change prime ministers like we change BBQ sets every couple of years, the political system is stable and robust as it should a developed nation like ours. Australia is also a $1.6 trillion economy which is inextricably linked with the dynamism of China, the new upstart that is increasingly determined to flex both her soft and hard political muscles in the Asia Pacific region.
The fallout from these factors is a generation of aspiring homeowners destined to become life-long renters in a vast, land-abundant country they call home. For this group of young people, the Australian dream of home ownership is being shut out with each failed attempt at weekend auctions dominated by cashed up investors and baby boomers.