Selective Construction

Planning Β· Value Β· Improvements

Adding on or topping up the loan?

See your home with and without the work, then what's left after the work and the top-up interest.

Your addition

Typical cost: $15,000–$45,000 Β· Source β†—

$
$

Sleep-out or extra bedroom you rent out.

$

Valuation increase

+$50,000

Your real return

+$6,60916.5% on money spent

Value added grows 3% a year, less 3% selling costs. Top-up borrowed over 10 years. General information, not financial advice. Example figures are for illustration only.

Open the full improvements calculator β†’

Real value isn't how much the valuation goes up. It's the return on what you invest: the money that comes back after the work, the interest and the costs of selling are paid.

  1. What you spend

    The full cost of the work: builder, materials, design, consents and GST. If you pay cash, that's money you can't use elsewhere.

    Example

    βˆ’$40,000

    Kitchen renovation

  2. What borrowing costs

    Interest paid on any top-up loan from the day you borrow until you sell. The loan itself is already counted in step 1.

    Example

    βˆ’$9,615

    5 years at 6% on a 10-year top-up

  3. What you get back

    The extra your home sells for because of the work, after agent and selling costs. If you rent it out, add the extra rent it earns.

    Example

    +$56,225

    $50,000 added, grown 3% a year, less 3% selling costs

  4. Your return

    Step 3 minus steps 1 and 2. Divide by what you spent for the return %. Compare that with leaving the money in the bank or paying down your mortgage.

    Example

    +$6,609

    16.5% on $40,000