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PROFIT FROM PROPERTY
Which Improvements Add Value To Your Home?
Daren’t move in the current market conditions? Then why not improve your home to maximise its potential? That way, you can enjoy it while you live there, and make the most of its future value. Here’s how to add value to your home.
If the current market conditions and house price predictions aren’t enough to put would-be movers off, the sheer hassle and cost of moving house should do it. Unsurprisingly perhaps, nine in 10 homeowners don’t intend to move in the next six months, according to a survey by Credit Expert. We’re opting to improve instead. Twenty-five per cent of homeowners undertaking home improvements in the last 12 months did so specifically to add value to their property, according to Halifax research. ‘If you move, stamp duty, legal fees, removal-van bills and estate agency cheques all add up to a chunky five-figure sum - and that’s before you’ve shelled out to get the new home redecorated to your taste. But if you spend that money on your current home, you can transform it,’ says Hugo Tugman, founder of Architect Your Home. So, if you can’t be in the house you want, love the one you’re in!
How Much Should Building Work Cost?
You can get an idea about the average cost of typical home improvements at the Building Costs Information Service. And, you can value your property or retrieve local market data at Hometrack.
Be careful not to overstretch yourself to fund the work. Now may not be the time to extend your mortgage.
How To Make The Right Improvements
Spending money on home improvements doesn’t automatically increase the value of your property. The work has got to enhance the property, be in keeping and be well designed/constructed (or you could risk devaluing it instead).
The cost of any home improvement must also be in proportion to the value of the house. Peter Bolton King, chief executive, National Association of Estate Agents (NAEA) says: ‘You must remember that the average price of properties in the local area will dictate the maximum price your property can achieve.’
For instance, if you own a three bedroom semi and average prices in your area or £300,000, it’s unlikely that adding an extension will increase the value of your home much above this threshold. An expensive basement conversion only makes sense in an area where land for residential property at a real premium. Turning the garage into an office is no good it if compromises the parking.
Which Home Improvements Add Value And How Much? (percentage figures in brackets are approximate)
1 An extension (10 to 50 per cent)
2 New kitchen (five to 10 per cent)
3 Loft conversion (five to 10 per cent)
4 Off-road parking (10 per cent)
5 A conservatory or glass extension (five per cent)
6 Creating an en suite bathroom (0 to five per cent)
7 Upgrading the exterior (15 per cent)
‘When estate agents go to an extended property it is very clear that where the owner has thought out the issue of bright natural light the house sells more easily,’ says Chris Brown, vice president of the NAEA.
