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How to add value to your home

Our guide to improving rather than moving

With house prices making it harder to afford to move up the ladder – and the cost of moving alone now standing at a record £12,000 – many families are finding it makes financial sense to stay put and improve, rather than move.

Successful improvements can add tens of thousands to your house price at just a fraction of the cost of moving.

Not only will they make your home a more enjoyable place to live – they could also make it easier for you to move up the housing ladder in the future, as your home’s increased value will help bridge the funding gap to your next home.

With all home improvements, planning is key. One in four projects end up over-budget – so a little extra work upfront can pay dividends later on.

Beware of the 'ceiling price'

Before you spend large sums on adapting your home to suit your current needs, it’s wise to make the changes having carefully considered your chances of recouping the value of your improvements in your home’s potential future sale price.

Every home has a ‘ceiling price’ – the maximum price you can expect to achieve based on similar properties in your area.

There is likely to come a point where improvements will fail to add any extra value to your property, so it’s worth talking the options through with an estate agent to understand your home’s particular threshold. If you live in a house worth £250,000 and spend £25,000 on a new kitchen you may not be able to recoup the full value when you sell up. This would be much more possible with a kitchen more proportionate to your home.

Funding improvements

If you use savings to fund the improvements you could find that the increase in value you achieve could be more than the interest you would have earned in a savings account, particularly while interest rates are low.

If you don’t have savings you could consider taking out a loan – or, for bigger improvements, remortgaging your property to free up some equity. Before you consider these steps, though, you will need to check whether you can afford the repayments.

Things to bear in mind

All the suggestions below will potentially add value to your home if done sympathetically. Importantly, they could also help enhance your home’s ‘live-ability’ – helping reduce the need for a costly and stressful move.

Bear in mind that the costs and potential impact on your home’s sale value indicated here are only intended as guides – the actual figures could vary significantly. In addition, for any home improvements you should take necessary precautions to help ensure the work is completed to satisfactory quality and to time and budget:

  • Take the time to plan exactly what you want to achieve – consulting structural engineers and architects if necessary, and obtaining a minimum of three quotes from builders
  • Agree the cost beforehand – set aside a strict budget but allow a contingency in case of overspend
  • Agree on a realistic time frame upfront, but remember there may be unavoidable delays, caused by bad weather for example
  • Keep up regular communication with the builders
  • Have a contract in place to cover both parties and never hand over payment upfront
  • Check your builder has the right insurance in place before any work begins


1. Convert your garage - add up to 20%

Around 90% of all garages in the UK are left empty. If you have off-road parking and depending on where you live, you may find converting a garage can significantly increase your home's value.

If your garage is attached to your house, you should be able to convert it into another room for between £10,000 and £20,000. Estimates suggest conversion into an en-suite bedroom could increase your home's value by around £40,000 (around 20% of the value of an average £218,000 home) – but if that doesn't suit your home or your needs, by turning it into a playroom or study you could still increase the value by about £20,000 (approximately 10%).


2. Knock down walls

If you have lots of smaller reception rooms divided by walls that aren't load-bearing, knocking one or more of them through could transform the 'flow' of your living space at a relatively low cost.

Nowadays most people's lifestyles suit a large kitchen/diner better than a smaller kitchen and separate dining room. Equally, if you have two small living rooms, knocking them together could create a more attractive space.

If these changes suit you and your lifestyle, they are likely to appeal to potential buyers too, so you are likely to be adding value to your home.

It's difficult to calculate the potential increase in value this may bring to your home, but the cost is minimal compared to many other home improvements: knocking down a non load-bearing wall costs around £2,000, including any repositioning of radiators and light switches.

Most people's lifestyles suit a large kitchen/diner

3. Update your kitchen - add up to 6%

The popularity of open plan kitchen and dining spaces means kitchens are increasingly the focal point of a home, providing everything from the dinner table to the place where kids do their homework.

Buyers may be willing to pay more for a house with an attractive, spacious kitchen so by making improvements you could be increasing your home's future resale value as well as enhancing your own enjoyment of your home.

A basic makeover, focusing on changing fixtures and fittings such as door and drawer handles and energy-efficient appliances, can make a surprising difference to the feel at minimal cost.

If you're wanting to fit a completely new kitchen, including appliances, research shows you can expect to pay £8,000 on average and in doing so could add around 6 per cent to the value of your home (around £13,000 on an average-priced property).


4. Convert your loft - add up to 15%

Extending upwards is one of the easiest ways to gain an extra bedroom and bathroom – a loft conversion can increase floor space in your house by up to 30 per cent.

The most successful loft conversions are those that appear to be an integral part of the existing property, both inside and out, and in which the home retains a balanced ratio of living space to sleeping space.

You'll need to ensure the pitch of your roof is steep enough to allow the necessary headroom and remember that you will have to sacrifice space on the floor below in order to install access.

You'll need to consult a structural engineer to make sure your floor joists can support the extra weight. You may also want to hire an architect to bring your ideas to life and act as an agent to guide you through the required planning permissions and building regulations. If certain conditions are met, you may not need planning permission Link opens in a new window 

A basic loft conversion costs around £16,000-£20,000 and can add up to 15 per cent to your property's market value (just over £30,000 on an average priced home).

If your loft is unsuitable for a conversion, another option is to extend either to the side or the rear. Generally, similar rules to those for loft conversions also apply to extensions, although the size and therefore cost can vary more.

Successful loft conversions retain a balanced ratio of living space to sleeping space

5. Build a conservatory - add up to 5%

A conservatory is a relatively simple, mess-free way of adding living space to your home.

Make sure it's in proportion to your house, though, as a badly designed and poorly fitted conservatory could actually reduce your home's value.

If a conservatory is under a certain size, you may not need planning permission Link opens in a new window 

Expect to pay between £4,000 and £10,000 for a conservatory and have your home increase in value by around 5% – around £11,000 on an average-priced home.


6. Add another bathroom - add up to 6%

Adding an extra bathroom, or an en suite, can make life with a growing family easier in the mornings as well as being a selling point in the future.

Bear in mind, though, that if you are converting an existing bedroom into a bathroom it could end up devaluing your home. In a street made up of three-bedroom properties, downsizing to two bedrooms would be a mistake. A better choice may be to carve out an en-suite in a large master bedroom.

Typically a new bathroom can cost £2,500 to £6,000 – depending on the types of fixtures and fittings you want – and could add about 6% to your home's value (around £13,000 on an average priced property).

An extra bathroom can make life easier in the mornings

7. Create a driveway - add up to 10%

In some areas of the country, the ability to park close to your front door comes at a huge premium. So if you have the room to add parking tastefully, you are sure to increase value.

For maximum added value, make sure your driveway materials complement existing paths and patios.

Perhaps surprisingly, planning permission could be a consideration if you plan to build or replace an existing driveway. To avoid the need for it, use porous substances such as gravel, block paving and certain types of asphalt. It is also helpful to consider areas of natural drainage.

It's estimated that an attractive driveway can add between 5% and 10% to the value of your home – in other words, up to around £22,000 based on the price of an average home.

House price information is based on the Nationwide House Price Index. The cost of moving home is from a 2014 joint study by the Post Office Money and the Centre for Economics and Business Research (Cebr).

Interested in remortgaging to fund home improvements?

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YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

 

Links to external websites are for information only. Virgin Money receives no income from them and accepts no responsibility for the website content. The information in this article is correct as at 02 May 2017.