The renovation that can increase the value of your home by almost 25%
New analysis has revealed how a particular type of renovation on your home can increase its value by almost 25 percent.
Analysis by Nationwide Building Society suggests that an extension or loft conversion could add as much as 24 per cent to the value of a typical home.
A survey conducted for Nationwide showed that kitchen and bathroom renovations are the most popular among homeowners who have made improvements to their properties in the last five years.
Research shows that an extra bedroom can potentially add 13 per cent to the value of a typical property, while an extra bathroom can add 4 per cent.
The association calculated that a 10 percent increase in the floor space of a typical home could potentially add 5 percent to the home’s value.
Individual circumstances will vary and factors such as a home’s location, wider housing market trends and the extra floor space gained by any extensions will have an impact on the value of a property.
Homeowners also need to weigh the cost of any renovation when considering how much value it could add.
The average spend across all homeowners renovating in the last five years was around £52,000; Among homeowners aged 25 to 34 it rose to £97,000; This is likely a reflection of more significant improvements made by the younger age group.
Andrew Harvey, senior economist at Nationwide, said: “We used our house price data to examine the factors affecting home values, as well as the potential to add value.
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“While we cannot determine the value associated with kitchen and bathroom renovations, we can explore the impact of more significant projects, particularly those that increase the size of the property.
“Location remains key to home values, but other factors such as number of bedrooms are also important to home buyers. Home improvements that increase the size of the property, such as extensions or loft conversions, remain an attractive way to add value.”
He added: “Homeowners who add a loft conversion or extension combining a large double bedroom and bathroom can add up to 24 per cent to the value of a three-bedroom, one-bathroom home.
“Our analysis shows that this can be a good way to increase the value of a property, provided the room is usable.”
The survey found that among homeowners who have renovated in recent years, nearly a third (34 percent) have made green improvements, and in that group, more than half (56 percent) have added solar panels.
Mr Harvey added: “Young homeowners appear to be the most interested in greening their homes, with more than two-thirds (69 per cent) of 25 to 34-year-olds who have renovated in the last five years making green improvements.
“Older homeowners (ages 55 and older) were least likely to make green improvements (18 percent). Bathroom remodeling was the most popular among this demographic (68 percent of those making improvements opted for it).
“Looking at other popular home improvements, 39 per cent of renovating homeowners have added an extension such as a shed or entertainment area, while 23 per cent have added a conservatory to their property. In terms of larger-scale projects, 24 per cent of renovators have opted for a loft conversion, while 21 per cent have had a single-storey extension built.
“The most popular reason for renovating was to make the property look nicer (54 per cent cited this as a reason), while 35 per cent were looking to increase the value of their property, with the latter being the most important factor for young homeowners.
“Thirty-two percent of survey respondents were making improvements to modernize the property to make it livable, while 26 percent wanted to add more space. Interestingly, only 7 percent were renovating in preparation for sale.”
The survey also showed that while most homeowners were satisfied with the results, only 4 percent regretted renovating their home.
The most common reasons why homeowners were dissatisfied with the work undertaken were that the costs were too high and the results were not what the homeowners wanted.
The survey was conducted by Censuswide among 2,000 homeowners in October.
Mary-Lou Press, president of NAEA (National Association of Realtors) Propertymark, said homeowners should consider regulations regarding loft conversions.
He added: “Other things to know include whether your property is listed or within a potential conservation area, so it is always vital to check fully with relevant planning departments before making any changes.”
