DON’T BUST THE BUD­GET

VICKY SHAW ex­plains how to add value to your home, with­out go­ing over your bud­get

Gloucestershire Echo - - PROPERTY NEWS -

As the hous­ing mar­ket has slowed down in some parts of the UK, many home­own­ers are choos­ing to im­prove their ex­ist­ing prop­erty, rather than move – and new re­search from Post Of­fice Money sug­gests you can po­ten­tially add sig­nif­i­cant value by do­ing so. “Over the past few years, house price growth has slowed, so home­own­ers have turned to other op­tions to add value to their homes – with ren­o­va­tions be­ing a clear op­por­tu­nity,” says Chrysan­thy Pispi­nis from Post Of­fice Money. Be­fore you get started though, it’s im­por­tant to care­fully weigh up all the costs in­volved – which could out­weigh any value that may be added. Here’s a look at how peo­ple are fund­ing home im­prove­ments, the value they may po­ten­tially add, and how to stop costs bal­loon­ing out of con­trol...

How much are home­own­ers spend­ing?

Ac­cord­ing to Post Of­fice Money’s re­search, nearly two-thirds (64%) of home­own­ers have made im­prove­ments to their prop­er­ties over the past five years, spend­ing £14,015 on average. The costs can stack up dif­fer­ently de­pend­ing on whether you’re us­ing sav­ings or bor­row­ing cash, which could mean sig­nif­i­cant in­ter­est charges. In or­der to fund ren­o­va­tions, three-quar­ters (74%) of home­im­provers used their sav­ings, one in six (16%) used a per­sonal loan or credit card, while one in 16 (6%) used eq­uity re­lease or mortgages, Post Of­fice Money found. A sep­a­rate study also sug­gests some costs may be in­creas­ing. Shaw­brook Bank says anal­y­sis of its loan data shows the average size of a home im­prove­ment loan has in­creased by 16%, when com­par­ing the first quar­ter of 2019 with the same pe­riod for 2018. The bank sug­gests this could be partly due to fluc­tu­a­tions in ster­ling and in­creases in the cost of im­ported goods and raw ma­te­ri­als.

How much can im­prove­ments add to the value of a home?

Post Of­fice Money says anal­y­sis based upon the average price tag on a three-bed semi-de­tached home in the UK (£286,000) found prop­er­ties with cer­tain home im­prove­ments were on the mar­ket for around 19% higher than the average ask­ing price. Though, it’s im­por­tant to bear in mind that the price some­one wants for their prop­erty isn’t nec­es­sar­ily what they’re go­ing to get – and what may be a de­sir­able ren­o­va­tion for buy­ers in one part of the UK, may be less at­trac­tive else­where. If you’re ren­o­vat­ing with even­tu­ally sell­ing in mind, es­tate agents may be able to give point­ers on what fea­tures buy­ers are look­ing for in your area.

How much could dif­fer­ent home im­prove­ments help boost value by?

Post Of­fice Money’s re­search searched prop­er­ties on Zoopla, as well as home ren­o­va­tion web­sites, to es­ti­mate the cost of a typ­i­cal home im­prove­ment.

It found, for ex­am­ple, that prop­er­ties boast­ing a land­scaped gar­den were par­tic­u­larly likely to have much higher price tags than average. The es­ti­mated cost of gar­den land­scap­ing was £2,750, although this could vary hugely de­pend­ing on the ex­tent of the ren­o­va­tion. It also found that prop­er­ties with a land­scaped gar­den – as well as other at­trac­tive fea­tures which would po­ten­tially push up a home’s value – tend to be on the mar­ket for 77% above average house prices. Mean­while, the cost of an ex­ten­sion was put at £80,000, and homes with this fea­ture were typ­i­cally listed for sale for 37% above average prices. A new kitchen was es­ti­mated to cost £7,500 (prop­er­ties with this fea­ture were be­ing mar­keted for 26% above the average house price).

Mak­ing home im­prove­ments is of­ten the best way to the house of your dreams

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