Consider an extension or loft conversion to add value to your home

Question

If you're looking to boost the value of your property, consider adding an extension or loft conversion, new research reveals.

The findings by Britain's biggest building society suggested that an extension or loft conversion could add 25 per cent to the value of your property, while an extra bedroom could add 14 per cent.

An extra bathroom, meanwhile, could add 6 per cent to the value of the typical home in Britain while a 10 per cent increase in floor area could lead to a 5 per cent uplift in a property's value, Nationwide said.




Nationwide looked at the different ways homeowners can boost the value of their property





An extension or loft conversion could add 25% to the value of your property, while an extra bedroom could add 14%

Nationwide used its own lending data to compare the price paid for a property against various characteristics of a home, including the type, age, number of bedrooms and bathrooms and floor area.

It also factored in Acorn data about the local neighbourhood that the property is in - based on its postcode. 

This data was from an organisation called CACI, which divides Britain into 59 categories based on the type of people that live there.




RELATED ARTICLES

Previous

1

Next



My planning application for child minding got 37 neighbour... What does the average house price buy in your area? Number of tenants hunting for a new home is up 38% in a year I want to buy a home with an agricultural tie: I'm not a...



Share this article

Share


This location data means, for example, that a property located in an area classified as housing 'wealthy countryside commuters' would attract a considerable premium relative to a similar property in say a 'post-war estate'. 

Nationwide used the combined data to reveal various price differences. For example, when estimating the value of an extra bedroom, it looked at the difference between a two-bedroom house with an average floor area and a three-bedroom house with an extra 13 square metres of floor space.

This is while keeping all other factors constant - such as the location of the property  - allowing Nationwide to isolate the price impact. 




Extending out: The size of the property - including number of bedrooms - is important to buyers says Nationwide





Popular: Loft conversions have become very popular in recent years

Andrew Harvey, of Nationwide, explained: 'The pandemic period was characterised by a 'race for space' as people re-examined their housing needs, although more recently there have been signs that some of these patterns may have unwound, at least partially.

'Considering this, we've taken the opportunity to look at the factors that affect the value of homes, and the potential to add value.

'Location remains key to house values, but other factors, such as the size of the property - including number of bedrooms -, are also important to homebuyers.

'Home improvements that increase floor area, such as an extension or loft conversion, remain a compelling way to add value. Indeed, since we last looked at this back in 2016, the value added by such improvements appears to have increased.

'Ultimately of course, the decision to invest in the home is an individual one, taking into account the costs and hassle involved, as well as potential benefits.


 Amongst owner-occupiers considering moving, the most cited reason was for a larger house or flat

'And, for some households, it's a choice between move or improve. Amongst owner-occupiers considering moving, the most cited reason was for a larger house or flat.'

Nationwide suggested that having more useable space is generally thought to be consistent with better quality accommodation and people appear to be prepared to pay for it.

Homeowners that add a loft conversion or extension, incorporating a large double bedroom and bathroom, can add as much as 25% to the value of a three-bedroom, one-bathroom house[1]. This has increased from 22% in our 2016 research feature.

Mr Harvey added: 'Our analysis suggests that, providing the room is useable, adding an extra bedroom can be a good way to increase the value of a property.

'The table below shows the value added for different property types by increasing floor area to accommodate an extra bedroom.

'The increase in home working means that some of these spare bedrooms are now more likely to be used as a home office or study.

'Additionally, many householders buy properties they intend to grow into over time, as their families expand and, probably more significantly given demographic trends, people remain in properties after their children fly the nest.'




Nationwide looked at the value added to a property for increasing the number of bedrooms and compared it by property type


Energy efficiency also adds value
Mr Harvey went on to say that as well as extending a property, other ways of making it more attractive include making it more energy efficient.

The cost of living crisis means energy has become a key concern for households.

The Government aims to update as many homes as possible to energy efficiency rating 'C' by 2035 'where practical, cost effective and affordable'.

It also aims for all fuel poor households, and as many rented homes as possible, to reach the same standard by 2030.




Nationwide said decarbonising and adapting the housing stock is critical if Britain is going to meet its 2050 emissions targets

Mr Harvey concluded: inneneinrichtung 'During the past ten years energy efficiency has improved significantly due to the higher energy rating of newly-built properties and the improvements carried out on many existing homes, such as loft and cavity wall insulation.'

Nationwide's analysis does not take into account gardens or features such as interior design, garden landscaping and fitted kitchens. It said such features may add value for some buyers, but not for others.

Catherine Merrett, of estate agency Antony Roberts, said: 'Many people assume an extension or loft conversion will add value, outweighing the cost of the works but much depends on your location.

'Check property portals for comparables of similar houses, those which are extended and unextended. 

'In high-value areas, adding lots of space will often also mean an uptick in value but it needs to be a high specification to achieve a premium price when considering resale. 

'The trick is to opt for a good quality specification but not go too high for your area; for example, avoid a Belgravia finish if you are going to get Twickenham prices.

'With any extensive works, you need the help of a good architect, builder and possibly an interior designer. 

'Checking the planning portals to see what your neighbours have had planning permission for is also a good idea. Unfortunately, the cost of building work and materials' have increased substantially in the past couple of years so this must be factored in.'