Renovation Strategy

Advantages:

• Instant increase of equity for further investment or better risk management
• Most money paid to the 'land component' to ensure solid future growth
• Instant increase of rent for better cash flow
• More efficient use of funds
• Great tax benefit
• Lower town planning and building risk
• You can buy under market value sometimes

Disadvantages:

• A lot of work if you do it yourself or a lot of management if done by others
• It takes time to find the right property that can make the numbers work
• Easy to underestimate the time, cost and work involved in a renovation
• The increase of equity and rent may not be obvious enough to justify the cost and effort