When Adding A Bedroom Doesn’t Add Value

Whether you are giving a home a cosmetic makeover or changing the floor plan, your renovation must add value to the property. Adding a bedroom can be a valuable strategy to maximise your profits. However, there are times when it doesn’t pay. 

The statistics guru, John Lindeman, introduced us to the useful function in realestate.com that helps you determine the difference in median house price between two, three or four-bedroom houses in any given area. You can use it to determine whether adding a bedroom to a property will help you realise the profit potential. 

It’s a fantastic strategy for adding value to a property if you make informed decisions about its viability. To make it easier for you to do your due diligence, we have outlined the five questions you must consider when determining whether an additional bedroom will boost your profits.

Creating The Ideal Floor Plan For Your Property

When using our tried and tested Cosmetic-Plus renovation strategy, the floor plan has the greatest potential for adding value to a property. When you create the ideal floor plan, you will significantly influence the project’s profits. 

If you get this right, it’s a winner: If you get it wrong, it’s a deal breaker.”

~ Bernadette Janson

The internal layout of your property renovation begins with your research on realestate.com. We took a look at a few examples to give you an idea of what you can learn from this website:

Bendigo:

    • Difference in value between a two-bedroom and a three-bedroom house is $25,000
    • Difference in value between a three-bedroom and a four-bedroom house is $325,000

Winham, Queensland

    • Difference in value between a two-bedroom and a three-bedroom house is $32,000
    • Difference in value between a three-bedroom and a four-bedroom house is $329,000

Preston, Queensland

    • Difference in value between a two-bedroom and a three-bedroom house is $29,000
    • Difference in value between a three-bedroom and a four-bedroom house is $208,000

New South Wales: 

    • Difference in value between a two-bedroom and three-bedroom house – Not enough to compare.
    • Difference in value between a three-bedroom and a four-bedroom house is $215,000

Surrey Hills, Victoria

    • Difference in value between a two-bedroom and a three-bedroom house is $600,000

At first glance, there is a pattern in the difference in property values. But, unfortunately, it’s not a consistent pattern across the board. 

 If you were to look at that, you would think: ‘Okay, so that’s definite. If I put an extra bedroom in my three-bedroom house, it will definitely add a two to three hundred dollar profit.’ But, it’s a mistake to rely on stats.”

~ Bernadette Janson

Statistics Will Not Always Give You The Guidance You Need

Statistics and data analytics can be helpful. But unfortunately, there’s a lot of bad data out there, and statistics can be manipulated. For example, there are roughly 1.4 billion people in China and 7 billion people on Earth. Therefore, one out of every five babies born on Earth is Chinese. So you could say statistically, if you already have four kids and you’re expecting a fifth, it will be Chinese.

It’s a bit tongue-in-cheek, but it makes our point. You can’t rely purely on statistics. 

We know that you want to make the best decisions about how you will spend your money and add value to your renovation projects. That’s why we have identified five questions you must ask to help determine the ideal flood plan for your property.

#1 Will An Extra Bedroom Add Value To The Property?

Creating an extra bedroom in the existing floor plan of a property is the most cost-effective way to add value. Whether you are adding a room to a two-bedroom house or a three-bedroom house, you will increase your profits if it is done well.

It’s crucial to ensure that the addition will not have a negative knock-on effect. Will it fit seamlessly into the floor plan and enhance the house’s functionality?

#2 Will The Size Of The New Bedroom Be Adequate?

A small bedroom may not be a value-add, especially if it takes space from something else. You must ensure that you can comfortably fit a bed into the room, and a wardrobe is a good idea too. 

You must consider the dimensions of the room you plan to create. For a bedroom, one wall must be at least 2.6m long to fit a bed into the room and still be able to move around it. A bed is slightly more than 2m long, and you need at least 600cm to move freely past it. 

The other wall must be a minimum of 2.4m, and if you plan to add a wardrobe, you must include additional space for it. If you consider a single bed is 900cm wide, you will be left with only 750cm on either side of it, and even less than that if you squeeze a cupboard into the room.

You will be left with a tiny room, which may attract negative comments about your floor plan from potential buyers.

If you’re going to put a bedroom in, it needs to be usable.”

~ Bernadette Janson

#3 Does The Position Of The New Bedroom Make Sense?

The position of the new bedroom in the home is a crucial consideration. Is it logical? How do you access it? You don’t want a bedroom directly off a living area or positioned so you have to walk through another room to get to it. Ideally, the entrance should be off a hallway.

Is the room going to be an island, locked away from the rest of the bedrooms in the house? If so, you must think about how you can make that position seem logical. For example, you may not decide to call it a bedroom. Instead, it can be a study or a spare room. 

You might think you wouldn’t have to spell it out to potential buyers. But, in our experience, it’s always best to do so, as buyers don’t have a lot of imagination. So, if you want them to know something about the layout of the house, you need to tell them. For example, add it to the floor plan and decorate the room accordingly.

#4 Do You Have The Correct Ratio Of Bedrooms To Bathrooms And Livingrooms?

The ratio of rooms in a home is a factor that cannot be ignored. For example, you will lose value if you have too many bedrooms and not enough bathrooms. The ratios you must consider include:

The number of bedrooms to bathrooms

  • A single bathroom is adequate if you have a one- or two-bedroom house. 
  • In a higher-value property, your value will increase if you have a bathroom for each bedroom. 
  • A three-bedroom house should have at least one and a half bathrooms.
  • For four bedrooms, you should plan for one and a half to two and a half bathrooms.

The number of bedrooms to living areas:

  • A single living area is sufficient in a one, two or three-bedroom house.
  • An additional outdoor living space is always a good idea.
  • If you have four or more bedrooms, you must have two living areas because there are likely to be more than three people living in the house, and you want to be able to provide separate areas for them to spend time in.

#5 Does Adding A Bedroom To The Floorplan Work With Your Strategy?

What is your reason for renovating the property? Is your profit-making strategy to renovate and sell, or are you planning to renovate and hold the property?

Your market is more critical if you plan to sell the property compared to renting it out. Renters tend to be grateful for the space, but when people spend large amounts of money, they get picky and pickier as the price point increases. 

Therefore, you must know your buyer. You must do your research so that you understand what your potential buyers consider valuable in a property. For example, rather than adding a fifth bedroom to a four-bedroom property, it may make more sense to transform one of the bedrooms into a second bathroom instead of adding another smaller room. 

An Example Of A Floor Plan Renovation Gone Wrong

We are confident that our Wonder Women would do their due diligence and make well-informed decisions before progressing with a renovation. However, only some have the benefit of tried and tested renovating skills and strategies to back their renovations, and they have been known to make some costly errors.

To illustrate, Bernadette looked at a property that has been on the market for more than a year in the area she lives in. She feels that they have not been able to sell the house because their pricing is wrong, and their floor plan leaves a lot to be desired. 

Price:

The average house price in the area is $2.92 million. The property was placed on the market at the same time as two other four-bedroom houses, which sold for $5 million and $4.9 million. 

Now, this house has eight bedrooms. It went on the market at the same time with a starting price of $5 million, and it’s down to $3.8 million, and I think they’re on their third agent.”

~ Bernadette Janson

Floor plan:

Bernadette says the floor plan has played a big part in the reason the house has not been sold. It has eight bedrooms, five bathrooms, and space to park four cars, so you would think it is a fantastic home. Finding a big house in the area is difficult, and it’s just as challenging to find parking spaces.  

The property was originally a restaurant and was renovated on a tight budget with the view of flipping it. However, instead of spending time and money to ensure a quality renovation, the sellers took a “good enough” approach. 

I think these guys have tried to please everyone and, in the end, have pleased no one.”

~ Bernadette Janson

The property features:

  • 8 bedrooms
  • 8 bathrooms
  • 2 kitchens
  • Wine cellar

It has significant potential. However, the layout could be more logical. The bedroom-to-bathroom ratio is all wrong. The top floor is an attic bedroom with no bathroom. On the next level is a small bedroom with an equally small bathroom adjacent to it that is shared with a much larger bedroom. There is a small bedroom and two bathrooms one floor down, and on the next floor are five bedrooms and three bathrooms.

To make matters worse, there is a bathroom and a bedroom directly off the lounge. Bernadette said:

We’ve got bedrooms off living rooms, bedrooms off kitchens. So it really is a rabbit warren.” 

Conclusion: Do Your Homework Before Adding A Bedroom To A Property

When executed well and based on sound research, adding a bedroom to a property can increase its value. However, your decision to create an extra bedroom must be carefully considered and not simply based on statistics.

Will the size of the room be adequate? Does it fit with the flow of the house? Are there enough bathrooms and living areas to accommodate another bedroom? And does an additional bedroom work with your renovating strategy?

Before jumping in and squeezing an extra room into the floor plan, answer the questions above. It may be more beneficial to create an additional bathroom or a study instead of a bedroom. 

If you want to meet up with a group of savvy renovators, come over and join the She Renovates Facebook group. It is full of (mostly) women working hard to make their dreams a reality, making a great income through renovating for profit.

[vc_empty_space][vc_separator]

She Renovates Free Facebook Group

If you want to meet up with a group of savvy renovators. I would say come over and join She Renovates Facebook Group. It’s a completely FREE Facebook group and it is growing at the rate of knots. We hit over a thousand members just recently, and now it seems to have picked up momentum. They are all savvy renovating women and men working their little hearts out to live a better life through renovating.

Share This

Bernadette Janson

Related Posts

Is a Rate Cut Imminent?

Explore how to project manage a renovation with our comprehensive guide, tailored for Australian women. Learn from expert insights on planning, budgeting, scheduling, and overcoming challenges, and discover how The School Of Renovating can empower your renovation journey.

9 tips for an easier Loan application process

9 Tips For An Easier Loan Application Process

Explore how to project manage a renovation with our comprehensive guide, tailored for Australian women. Learn from expert insights on planning, budgeting, scheduling, and overcoming challenges, and discover how The School Of Renovating can empower your renovation journey.

kitchen renovation ideas australia

Kitchen Renovation Ideas that Sells Homes

Explore how to project manage a renovation with our comprehensive guide, tailored for Australian women. Learn from expert insights on planning, budgeting, scheduling, and overcoming challenges, and discover how The School Of Renovating can empower your renovation journey.