Renovation

Rental Property Renovation Guide Melbourne — Costs, Timeline & ROI (2026)

By Steven Jin· Co-Founder & Chief Acquisitions OfficerPublished · Updated

Rent and yield examples are illustrative — not projections

Examples showing rent increases, yield improvements, payback periods, or "before / after" outcomes from granny flats, rooming house conversions, or renovations are based on past OptimaRea projects at specific properties under specific market conditions. They are not a projection of what your property will achieve. Actual outcomes depend on property location, land size, zoning, planning overlays, lender valuation, build costs, finance, interest rates, market rent, vacancy, tenant quality, holding costs, and tax — none of which are guaranteed. Property management is not a financial product and past project outcomes are not a reliable indicator of future results.

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Renovation Costs — Real Numbers from Our Projects

These are actual costs from our renovation team's recent projects across Melbourne:

Cosmetic (Light Touch): $3,000–$8,000

  • Full interior paint (2 coats — walls, ceiling, doors, skirting, window frames): $6,200–$7,000 + GST
  • SPC stone-plastic waterproof flooring: $62/sqm installed (e.g., 70m² house = $4,400)
  • Basic clean (post-renovation): ~$350 + GST
  • Full house deep clean: ~$650 + GST
  • Oven deep clean: ~$130 + GST

Mid-Range: $10,000–$30,000

  • Kitchen + partial renovation: $10,000–$12,000
  • Full bathroom (demolition, waterproofing, retiling): $15,000
  • Local bathroom repair (grout, tiles, waterproofing): $3,000
  • Switchboard upgrade: $1,500
  • Ceiling lights + exhaust fans (whole house): $2,000
  • Colorbond fencing: $150/metre

Structural: $30,000+

  • Full house renovation: $20,000–$30,000
  • Shed demolition and ground treatment: $2,000 (excludes garbage disposal)
  • Opening door in brick wall: $1,500

Recommended appliance brands for rentals: Midea (best value), Bellini, Esatto. Buy from Bunnings with PowerPass account for commercial discounts. Avoid premium brands (Bosch, Miele) — not cost-effective for rental properties.

Renovation Timeline — Speed Matters

Every week a property sits empty costs you $500–$800 in lost rent. Our renovation team operates on tight timelines:

Small renovation (cosmetic only): 1–2 weeks

  • Paint, flooring, clean, minor repairs
  • Tenant can usually move in within 10 days of settlement

Medium renovation (full house refresh): 2–4 weeks

  • Paint, flooring, kitchen update, bathroom refresh, compliance upgrades
  • Requires coordination of 3–4 trade teams

Our project management process:

  1. Pre-settlement inspection to scope work
  2. Trades scheduled before settlement date
  3. Work begins within 48 hours of settlement
  4. Daily progress tracking via our project management system
  5. Final inspection and deep clean
  6. Advertising begins 5 days before completion

Payment schedule for larger projects:

  • Deposit: 30%
  • Mid-stage (after painting/main work): 40%
  • Final (upon completion): 30%

Emergency reserve: We recommend budgeting an additional $2,000 buffer for unexpected issues (especially in older properties).

Warranty coverage: All licensed plumbing work carries a 3-year warranty. Electrical work is covered by the licensed electrician's certificate. General workmanship includes post-completion support from the builder.

Highest ROI Renovations for Rental Properties

Not all renovations deliver equal returns. Here's what delivers the best rental income uplift:

Tier 1 — Highest ROI (do these first):

  1. Fresh paint (100%+ ROI): $6,200 spend can increase rent by $30–$50/week ($1,560–$2,600/year)
  2. SPC flooring (90%+ ROI): Durable, waterproof, tenant-proof. $4,400 spend for a standard house
  3. Compliance upgrades: Required by law but also signal "well-maintained property" to quality tenants

Tier 2 — Good ROI (do when budget allows): 4. Kitchen refresh: New benchtops, handles, splashback — $10K–$12K for significant rent uplift 5. Bathroom refresh: Retiling, new fixtures, waterproofing — improves tenant satisfaction 6. Outdoor presentation: Fencing, garden cleanup, letterbox — first impression matters

Avoid over-capitalising:

  • Don't install a $40K kitchen in a $700K property
  • Don't use premium materials (engineered stone benchtops are fine for rentals)
  • Don't renovate bathrooms beyond functional requirements
  • Don't move plumbing or drainage unless absolutely necessary

The numbers: A $10K–$15K renovation typically adds $300–$400/week in rent uplift and $30K–$50K to bank valuation. Cost recovery timeline: 8–12 months.

Materials tip: Our renovation team sources materials cost-effectively — flat-packed kitchens, SPC flooring in bulk, and commercial-rate paint. This keeps costs 20–30% below retail renovation prices.

Talk to Our Property Management Team

Every property is different. Contact us to discuss how our management, leasing, and renovation services work for your situation. This is a general information conversation — not personal financial, tax, or legal advice.

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Important Information

OptimaRea Pty Ltd is a licensed Victorian estate agent providing property management, leasing, and renovation services. We are not a licensed financial adviser, tax agent, credit provider, or lawyer. Information on this website — including rent uplift examples, yield figures, build cost estimates, and compliance summaries — is general in nature only and does not take into account your personal circumstances. Figures are illustrative examples from past projects and are not a projection of what any particular property will achieve. Obtain independent professional advice before acting.

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