Whatshot

2026
All
September
2025
All
November
All
2024
All
June
All
April
All
2023
All
March
All
2022
All
2021
All
2020
All
March
All
February
All
2019
All
December
All
November
All
October
All
September
All
August
All
July
All
June
All
May
All
April
All
March
All
February
All
2018
All
December
All
November
All
October
All
September
All
August
All
July
All
June
All
May
All
April
All
March
All
February
All
2017
All
December
All
November
All
October
All
September
All
August
All
July
All
June
All
May
All
April
All
March
All
February
All
January
All
2016
All
December
All
November
All
October
All
September
All
August
All
July
All
June
All
May
All
April
All
March
All
February
All
January
All
2015
All
December
All
November
All
October
All
September
All
August
All
July
All
June
All
May
All
DHS
April
All
March
All
February
All
January
All
2014
All
December
All
November
All
October
All
September
All
August
All
July
All
June
All
KZN
May
All
April
All
March
All
February
All
January
All
2013
All
December
All
November
All
October
All
September
All
August
All
July
All
June
All
May
All
April
All
March
All
February
All
January
All
2012
All
December
All
November
All
October
All
September
All
August
All
July
All

Don't Overcapitalise When Renovating Your Home

Don't Overcapitalise When Renovating Your Home

Date: 2016-06-24
As interest rates rise and it becomes more difficult to qualify for new home loans, it is natural for an increasing number of owners to decide that they would rather make alterations or additions to their existing home than sell and try to buy a new one.

Unfortunately, the money an owner spends on improvements to a property does not always translate into an equivalent increase in its value to prospective buyers.

However, it isn't a good idea to make extensive changes without first checking to see that you will not be overcapitalising your property.

The result is that when you do eventually decide to sell, you will probably not recoup the full cost of the improvements in the sale price, and your potential profit on the property will be eroded.

This is why it is always best to consult a trained and experienced real estate professional about property values and price trends in your area before going ahead with any major remodelling projects.

When you do all the calculations, you may just find that your money would really be better spent as a deposit on a new home.

Another thing to bear in mind in this regard is that the Capital Gains Tax (CGT) exclusion on primary residences is currently set at R2 million.

That sounds like a lot to most people, and according to SARS it does mean that most primary homes in South Africawill never be subject to CGT.

However, if you bought your home more than 10 years ago, it is worth checking to see that any improvements you make won't push your eventual potential gain on the property over the R2 million mark.