Property Development Guide to Property Development

Date Published:

04/06/2008

Here's the top 5 tips from development expert Kate Faulkner, author of Develop Your Property, A Which? Essential Guide.

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Top 3 Tips

Developing Your Property Start by making a list of all the things you like and dislike about your home. It is also a good idea to think of what you like about friends' and family's homes, too. This helps focus your thoughts on what changes could be made to improve your living accommodation.

Initially, you might think that the only change you need is a new kitchen or bathroom. When you sit down and think about what you really want, you may prefer to create a kitchen diner with double doors to the garden. You may also be able to add an en suite at the same time as upgrading your bathroom for only a few thousand pounds more. The increased costs of these changes might be minimal, but they could help add value to your home's sale price and, more importantly, make a substantial change to your enjoyment and use of your home.

Courtesy of William Garvey

Value for Money

Next, think through how long you are likely to stay in the property after the changes. This will influence how much you spend on the project and what quality of materials and labour you invest in. For example, if you are improving your home because you want to sell it and maximise the sale price, then spending money on the most expensive materials may not be the best idea as you might not get your money back.

However, if you are updating a kitchen or bathroom and intend to stay in the property for more than ten years, investing in more expensive, lifetime guaranteed materials may mean that over time you get your money back.

Many people make improvements to a property without considering whether they will add value or not, or worse still, believing they will, when in reality they could even devalue a property. There are some things that, done well, are almost sure to add value and these are typically ones that add space, such as a bedroom.

'Improvements' that are bespoke features to a property, such as a sauna or outdoor swimming pool, generally won't add value.

The 'Ceiling' Price

It is important to know that spending money on things that usually improve the value of a home, doesn't always pay back. For example, spending £20,000 on a kitchen doesn't mean your property value will immediately increase by £20,000. Every property has a 'ceiling' price according to its location, size and age.

So if most properties in the road sell for £150,000 and you spend £20,000 on a kitchen and bathroom, it is unlikely you will get more than £150,000 for the property. Unless you are genuinely not worried about making a return on the improvements, ensure that you don't spend more on the property than you could gain on the sale price.