As property prices rise, more homeowners are staying put and renovating - and if they do it well, they should be able to double their money, experts say.
Demand from homeowners wanting to renovate and extend their homes has meant some builders are booked until next year.
Carl Nutt of The Building Company, said he was so busy he was no longer taking jobs for this year.
"We're booked up solid. I can't find enough guys to keep going," he said. "There's not enough new houses and new houses are going for such a premium."
Builder Dan Joint, who was working on a Victorian cottage in Auckland's Grey Lynn this week, said there were five or six other projects on the same street, one next door.
He received a call a day from people wanting to renovate. Most were looking to spend big money - $200,000 to $600,000 was the norm - but some people spent up to $1 million adding an underground garage in areas such as Herne Bay. Theatre rooms were also popular.
St Heliers property finder Diana Swan spent $800 fixing rotten floorboards and replacing windowsills on a Clendon investment property she bought for $180,000.
It sold eight months later for $215,000. "We hadn't done more than fixing the most important issue."
She said people in Auckland's sought-after suburbs could expect to double any money they spent on a property. A new kitchen, landscaping and painting could be done for $10,000 to $12,000 if the owners were prepared to do it themselves.
But Swan said homeowners should not overcapitalise.
There was no point spending a lot of money on a property if it would push it out of the range of prices that people were prepared to pay in the area.
"People spend too much money on a super-expensive kitchen and don't get their money back.
"They think because they've spent $100,000 on a kitchen the house is worth $200,000 more, but that's not the case."
If people were renovating for sale, they might find that a garage would not add much more value than a much cheaper carport, she said.
"If you're spending money on the right things, such as making the home clean, weathertight, neat and solid, you should expect to double your money."
Jane Eyles-Bennett, who offers consultancy services on renovations to improve a property's value, said people could save money by working with what was already in a house.
That could mean replacing kitchen cabinet doors rather than ripping the cupboards out and starting again.
"People strip out the kitchen and bathroom and do a full refit when all they needed to do was a tweak."
She advised Aucklander Jan Galloway on the renovation of her rental property at Orewa. Galloway spent $150,000 and increased the value of the property by $300,000.
She said the work that had made the biggest difference was knocking out a wall between the living area and the kitchen and refitting the kitchen.
Eyles-Bennett also recommended Galloway paint and clean the outside and inside of the house and flat downstairs, replacing most fittings and flooring.
But Joint said people should not think renovating would be a sure-fire money-spinner. First-time buyers in particular should avoid extensive renovations, he said.
It was not hard for things to go wrong - the property he was working on this week was to be moved back on the section, but the house movers had moved it to the wrong position and the neighbours would not sign off on it.
"It can end up costing a lot more than you think."