HOW TO EXTRACT VALUE FROM YOUR PROPERTY
Most people will do repair work, redo their bathroom, paint the house or commit to doing minor maintenance to their property, in the hope that this will translate to an appreciation of their property value. Whilst this is a good thing in most cases, in most cases it will not work and you may be overextending yourself. You need to determine how to extract value from your property. Basically, "anything that does not add value, adds cost".
Some strategic value extraction elements that we will focus on have a strong bearing on the realisation of the property value.
"The Zone Right" Value Extraction:
"Rooms Redesigning" Value Extraction:
- Subdivision Zone Right – this offers the property owner the right to turn one’s plot into multiple plots or stands.
- Scheme Departure Zone Right – this offers the right to operate a business from a residential property.
- New Building Plan Approval – This offers the permission to build a new house or development on the existing stand or plot.
- Demolishing Permit – This offers the right to demolishing the existing property to pave the way for new development.
- Passed Alteration Plan – this offers the permission to add or do extensions to the existing property.
"Physical Property" Value Extraction:
- Bathroom – If your bathroom has not been redone for a long time, this offers the opportunity to do away with that gaudy shower curtain, golden-oldies toilet seat, ancient bathtub, etc.
- Bedroom – If your bedroom is big enough to add a bathroom, consider doing just this. Everyone wants an on-suite master bathroom.
- Kitchen – If your kitchen feels small, consider converting it to an open-plan structure which will make it feel so much bigger and also invite social interaction with family members.
- Office/Study – If the office or study is no longer in use, consider turning it into new bedroom, guestroom, entertainment room or even bathroom.
"Property Location" Value Extraction:
- Single Story Structure – consider turning it into a double story and get that million dollar magnificent view as well as double the amount of space.
- Double Story structure – if there is one particular room that offers the best view, consider converting that room into a Unique Sales Point.
- Cottage – If your cottage is idle, consider letting it out in order to earn additional income.
- Yard – If your yard is big enough, consider adding a cottage or building a swimming pool.
How to develop an action plan to close the gaps identified in the business elements listed above:
- Busy Intersection – this offers advertising space business opportunities. Contact an adverting agency who may be interested in securing advertising space in your area.
- Busy Street – this offers business opportunities. Consider what kind of business you can run from your property address and then work from home.
- Busy Location –offers rezoning the property for other usage.
- Evaluate each value extraction element listed and identify gaps and missed opportunities.
- Set goals and targets for your choice of value extraction element.
- Allocate resources to ensure the value extraction element delivery (people, time, funding).
- Implement your value extraction project.
- Evaluate the value extraction element progress.
- Adjust your focus where needed.
- Keep monitoring until implemented.
- Quantify the outcome and determine the contribution to overall targets and goals.
These are merely guidelines for your consideration and you would still need to do thorough research prior to purchasing a property. Remember that you’re the only one who can put these considerations into action. Let this guide help you to move closer to your value extraction defined goals and targets!