How to use that tax refund to save money and improve your home's value
Category General News
"And getting money back from SARS is always a cause for celebration," says Gerhard Kotzé, MD of the RealNet estate agency group, "so it is really tempting to spend it on "spoiling' yourself or your family with a great outing, a holiday or maybe some new 'bling'.
"But for homeowners, it makes more sense to invest any tax refund in your home and leverage further savings, even if this doesn't seem very exciting right now."
READ: Tax return tips for landlords
He says that the first thing homeowners should consider doing with a tax refund is to use it lower the capital portion of their home loan, because this could help them save thousands of rands in interest charges over the life of the loan - especially if they make a habit of doing it every year.
"If you had a 20-year home loan of R1m at 7% interest, for example, just one extra lump sum payment of R2400 this year would cut the loan term by a month and save you almost R7600 worth of interest."
As a homeowner you may, however, want to spend your tax windfall to help fund something more immediately enjoyable.
Some estate agents generally agree that there's a ceiling on prices in most neighbourhoods, so massive renovations don't always deliver a good return on investment.
Kotzé a few good options to consider would be a second bathroom to make life easier now and lift the value of your home when it is time to sell, improvements to your security system that will lower your short-term insurance premiums or roof insulation to help keep your electricity bills down.
Try these budget-friendly ways to rejuvenate your home and improve its value would be:
1. Glam up your exterior
You're going to spend more time outdoors in summer. The garden is a good place to start. In most cases, this requires an investment in elbow grease rather than lots of cash.
Rob Knowles, owner of Q-Gardens, says nothing detracts from an otherwise lovely garden than a tatty lawn. A beautiful lawn needs care throughout the year, but especially in spring and summer. In winter rainfall regions, spring is a good time to sow lawn seeds, top-dress lightly and fertilise with a good organic fertilizer.
READ: Gearing up for Spring | 5 must-have entertainment items
Fix any uneven tiles, not only are they unsightly but could cause someone to trip. Avoid major earthworks. If you have any unsightly or barren areas, a few strategically placed plants can hide a multitude of sins. Use woodchips to cover sparse borders and position shrubs and flowers to enliven views from the windows.
2. Fresh coat of paint
Freshen up your stoep furniture by repainting it, or if it's wood, sanding and re-sealing. If the cushions are looking tired, consider reupholstering them or buying new ones.
Consider whether your house needs a new coat of paint. Not only is chipped or peeling paintwork unsightly, but paint provides a protective coating that prevents wood from rotting, metal from rusting and keeps out damp.
A freshly painted exterior, neat garden and clean windows all point to a house that is cared for. Estate agents call it 'kerb appeal' and doing the research is easy. Take a tour around the neighbourhood and consider which houses you'd visit on a show day and what makes them appealing.
READ: Selling in Spring? Try these expert styling tips
3. Show the heart of the home some love
Most people consider the kitchen the heart of the home. It's often where families spend most of their time and the first place potential buyers look.
Simple upgrades such as replacing old door handles, installing modern light fittings, refacing or fitting new cupboard doors, installing new taps or adding a Perspex or stainless-steel splashback can transform a kitchen.
SEE : Hot Décor Trends | 9 old interior design styles back with a millennial twist
4. Beautify your bathrooms
Bathrooms, like kitchens, get a lot of wear and tear which can result in them looking tatty and unhygienic. To keep costs down avoid changes that involve reconfiguring the plumbing.
Again, replacing taps and upgrading the lighting can make a difference. You may consider upgrading old, chipped or damaged baths and sinks, re-grouting tiles and replacing old-fashioned built-in cupboards and other fixtures, with modern free-standing units.
READ: 4 new Cobra bathroom ranges to inspire your next home reno
Kotzé adds that rising municipal service charges may also prompt homeowners to use any tax refund this year to help make some other changes relating to electricity and water consumption. These could include:
- Switching to long-lasting and low-power LED lighting and bulbs wherever possible;
- Installing tap and shower aerators and low-flow toilets;
- Replacing an old power-guzzling fridge or washing machine with an energy-star rated appliance that uses much less electricity; and
- Installing a water storage tank to save all the rainwater that runs off the roof and cut their consumption of municipal water.
"Or if you feel you really should 'splurge' on something new, why not consider a solar geyser or a few photo-voltaic panels so that you can start converting your home to run on free energy?"
Together with the added benefit of some simple upgrades, improving your property's value is a good idea in the long run, if you do decide to sell.
Author: Property24