Why Renovating Can Outperform Buying New

Buying a finished, turnkey home may feel convenient, but it often comes at a premium price and you are stuck with someone else’s choices. Renovating, on the other hand, allows you to:

• Tailor the property to your lifestyle and needs
• Control the budget by staging works and prioritising key areas
• Build equity faster by creating uplift through strategic upgrades

From a finance perspective, renovating can also be more efficient. Buying an established property usually means lower stamp duty, while the potential for valuation uplift post-renovation can reduce your loan-to-value ratio (LVR) which often unlocks sharper mortgage rates.

As Nikki from Orli-Interiors puts it:

“A thoughtfully designed renovation gives your home turn-key appeal while broadening its buyer pool. Even modest updates to kitchens, bathrooms, or outdoor living spaces can deliver outsized returns.”
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👉 Read Nikki’s original article here.

The Financing Side of Renovation

Many homeowners underestimate the flexibility they have when it comes to financing renovations. Options include:

• Equity Release: Unlock funds from the increased value of your home to finance works without touching savings
• Construction Loans: Purpose-built for renovations, allowing staged drawdowns aligned with building milestones
• Loan Splitting: Balance between fixed and variable rates for flexibility and certainty
• Investment Loans: If the property is rented during or after works, specialised investor products may apply

The smartest move is to engage a broker before you finalise design or sign builder contracts. This ensures you know your borrowing power upfront and can structure finance in a way that keeps cash flow safe.

Chris Dodson, principal broker at Mortgages Plus, explains:

“Older homes are usually in better locations and built with materials and craftsmanship rarely seen today. Renovating builds on that foundation. Bank valuations lean heavily on land value, so improving a property in a prime area creates uplift that supports sharper finance options.”

Case Study: The Collaroy Project

One of the most striking examples comes from Collaroy, where an outdated property had been divided into two apartments. The vision was to convert it into a high-end coastal family home.

The renovation added:

• Seamless indoor–outdoor connections
• A butler’s pantry and upgraded kitchen
• A generous laundry and clever storage solutions
• A pool designed for relaxed coastal living

The results were dramatic. Not only did the owners gain a beautiful home suited to their lifestyle, but comparable sales showed the renovation significantly outperformed nearby properties that had not been modernised.

Nikki explains:

“The result wasn’t just a better home for day-to-day living. It created enormous value in the process. Comparable homes without these updates achieved far lower results.”

Case Study: North Steyne, Manly

Not all projects start the same way. In North Steyne, Manly, a beachfront home had been held in the same family since the 1990s and had not been updated since. When inherited, the family faced a choice: sell in dated condition or invest in renovation.

With a budget of around $600,000, the property was completely reimagined. Prior to the works, local agents valued it at approximately $4 million. Post-renovation, the valuation jumped to $6.5 million which clearly demonstrated the power of combining prime location with strategic design.

This project highlights an important point: renovation is not only for owner-occupiers. Inherited or investment properties can benefit enormously when their true potential is unlocked.

The Role of Design

Good design does not just make a home look better, it adds measurable financial value. Nikki highlights how design ensures every element works together:

• Layout and flow support day-to-day living
• Light, storage, and finishes make a home feel modern and functional
• Professional documentation helps builders quote accurately, reducing cost blowouts

“Good design really does make a difference when you’re selling,” says local agent Matt Turner from Cunninghams. “Presentation isn’t just about making a place look nice, it is what helps buyers emotionally connect with a property. That is when you see competition kick in and prices start climbing.”

Renovation Tips for Maximising Equity Growth

If you are considering a project, keep these strategies front of mind:

• Engage a designer early to align vision and budget before trades are involved
• Focus on high-return areas such as kitchens, bathrooms, and outdoor living
• Understand ceiling prices in your suburb to avoid overcapitalising
• Secure planning approvals early to prevent costly delays
• Get finance sorted upfront so you understand your capacity and reduce stress

Renovating for Your Lifestyle

Beyond the numbers, renovation is about creating a home that works for you. Whether that means more storage for a growing family, a modern kitchen for entertaining, or a low-maintenance layout for retirement, the lifestyle improvements are just as valuable as the equity gains.

As Nikki says:

“When your home is designed around your routines and preferences, it becomes more than just a financial investment, it elevates your everyday life.”

Final Thoughts

Renovation is where lifestyle and investment intersect. With the right design partner and finance structure, even a dated property can become both a joy to live in and a strong financial asset.

If you are exploring renovation finance, speak with Mortgages Plus early. We will help you structure funding, protect your budget, and position your property for maximum growth.

Credit: This article is a collaboration with Nikki from Orli-Interiors, published with permission and added with mortgage insights from Mortgages Plus.