Britain is in the midst of a housing crisis, and spiralling house prices mean more and more of us are improving before resorting to moving
The Office for National Statistics reported in 2013 the number of 20 to 34-year-olds living with their parents reached 3.3 million, meaning more and more of us are squeezed into our childhood bedrooms with little in the way of privacy and nothing in the way of independence.
Whether you’re planning for a growing family or simply want to make your home easier to sell, the chances are you’ll need to borrow a little something to finance your plans. But which home improvements are worth the outlay, and which are money down the drain?
Making your home more ‘saleable’
Conventional wisdom among estate agents is that kitchens and bathrooms are what sell homes, so if you’re thinking of improving with a view to selling on, this is a good place to start. In terms of pure profit, you’ll make back everything you spend plus around half again - according to figures from ThisIsMoney.co.uk.
Move the bathroom upstairs
If you’re in an older property and have space, moving your bathroom upstairs will also allow you to expand your kitchen; both of these could improve your home’s value and salability significantly, even if it means sacrificing a small bedroom entirely. Speak to a local estate agent and they can give you a guide as to what your home will be worth after any work is done.
Making the most money
Some of the best returns on investment come from those things that aren’t particularly glamorous: windows, damp proof courses, roofs and boilers. It’s because buyers crave the peace of mind that their new home won’t spring a nasty bill on them within months of collecting the keys. A new roof costs £4,150 on average, but adds £6,750 on average to the sale price.
Simply adding extra windows will also help. British homes tend to be dark, and those with lots of natural light feel larger. Even if you’re not planning on moving, adding these can promote a sense of wellbeing.
Expanding the amount of physical space available in your home is one of the more expensive improvements, but can also increase its value. Adding a conservatory is, on average, the most lucrative - just remember to ensure it doesn’t eat up too much of your garden. Typically, you’ll not only make back what you spend, but double your money - and then some.
Adding an extension to a house
An extension is similarly worthwhile, but the scope for profit is more limited because of the larger average costs associated with extending - an average of £19,750. Check out our guide to extensions that don’t need planning permission.
You’ll more than make your money back with a loft conversion , too, but it’s not quite as lucrative as other means of extending because of the costs involved. Remember you’ll need to add a staircase, too, and this can rob you of space elsewhere.
Converting your basement
If you’ve nowhere to extend sideways, one option is extending down - into a cellar, or by adding a basement. Cellar conversions are comparatively inexpensive, but creating a new basement can be seriously pricey - up to £4,000 per square metre, according to this article in The Independent.
Based on this, a small (5m x 4m) basement can set you back tens of thousands of pounds. Even if the local market is strong and your estate agent thinks you’ll make it back, it’s less likely than other extensions to prove a major money-spinner - and that’s before you’ve factored in any stress associated, such as legal wrangles with moody neighbours.
Some things will cost a pretty penny but won’t make a significant impact on what your home is worth to someone else. Remember also that your road or neighbourhood will have a ‘ceiling price’ that is very difficult to break through, so even worthwhile additions can be less lucrative if there are simply too many of them.
A garden hot tub - though lovely - could be viewed as something of a frippery and while it might set some hearts racing, it’s very much a case of taste. If you simply must have one, go for a deck-top one that can move with you.
In fact, when it comes to the garden, adding value is often a case of simply tidying up and perhaps putting down some turf. Buyers are most inspired by a blank canvas that they can project their own ideas and lifestyle onto.
You can also spend a lot of money on expensive finishes that other people simply won’t appreciate: pricey tiles, wall coverings, flooring and kitchen surfaces. Unless you’re planning on staying put for years and enjoying these premium finishes for yourself, don’t bother.
How to finance your home extension
How you’re paying for your improvements depends largely on what you need to borrow. Very large projects may be best financed by remortgaging; banks and mortgage providers will normally consider extending your mortgage if you explain that you’re planning on making significant home improvements.
Alternatively, you may want to consider a personal loan. An unsecured loan, such as those provided by Admiral, can be used for anything from a new boiler to loft insulation without any financial risk to your home.