Home Improvement / Renovation -
Will Renovation increase the value of your home?
An increasing number of people are making the most of the current low interest rates to borrow money to improve their home, and see the spending as an investment for the future. But pouring cash into home improvements offers no cast-iron guarantee that you will increase your home's value. As a general rule, if you're going to make alterations, then do it because you want to for your own comfort or convenience, rather than to add value. And at the end of the day, many improvements should add to the saleability of your home, and make a huge difference to selling. However you may be better off just moving house instead, in which case you should also read our home-buying article
However that still doesn't stop people from asking what home improvements really pay off when the time comes to sell your house?
That's an important question for any homeowner contemplating moving or renovating. And the only possible answer is a somewhat complicated one.
That answer starts with the fact that really major improvements - room additions, total replacements of kitchens and baths, etc., -- rarely pay off fully in the near term. It ends with the fact that small and relatively inexpensive changes can pay off in a big way in making your home attractive to buyers if your decision is to move now.
Does Home Improvement work?
It's a simple fact, consistently confirmed across the UK over a very long period of time, that even the most appropriate major improvements are unlikely to return their full cost if a house is sold within two or three years.
Does that mean that major home improvements / renovations are always a bad idea? Absolutely not. It does mean, though, that if your present house falls seriously short of meeting your family's needs you need to think twice - and think carefully - before deciding to undertake a major renovation. Viewed strictly in investment terms, major improvements rarely make as much sense as selling your present home and buying one that's carefully selected to provide you with what you want.
Even if you have a special and strong attachment to the home you're in and feel certain that you could be happy in it for a long time if only it had more bedrooms and baths, for example, there are a few basic rules that you ought to keep in mind before undergoing any house renovation.
Probably the most basic rule of all, in this regard, is the one that says you should never -unless you absolutely don't care at all about eventual resale value - improve a house to the point where its desired sales price would be more than 20 percent higher than the most expensive of the other houses in the immediate neighbourhood.
Try to raise the value of your house too high by performing major home improvements and surrounding properties will pull its value down.
Indeed, some "improvements or renovations" can actually reduce your home's value, and your chances of selling at a good price, say experts. So what are the sure-fire winners, which should pay for themselves and boost saleability when you come to move?
These key points should be consider before booking a builder:
Central heating can be expensive to install in your home but future potential purchasers may be put off if you don't have it, so you should recoup your money with this improvement.
Secondary glazing on the inside of existing windows may be preferable to double glazing for a period home with original features. Although you are likely to get back only a third of your money on double glazing, savings will be made on household heating and electricity bills.
Make sure any improvements are appropriate to the character of the property. Try to avoid replacing old features - such as stained glass, picture rails and original skirting boards with modern ones.
An extra bathroom should keep its value, as long as it is not built at the expense of a bedroom. If the property is fairly large and has upward of five bedrooms with one bathroom - converting a bedroom into a bathroom may have certain appeal and homeowners may possibly break even on their investment.
A new kitchen is a popular home improvement but homeowners are unlikely to get back more than their original investment.
Stripping wooden floors may look attractive, but ensure the boards are of good quality. This improvement / renovation won't add greatly to the value of the home.
Knocking through walls may provide additional space but will also provide fewer rooms - any reduction in rooms could devalue the property.
A swimming pool may be the height of luxury, but potential buyers may be concerned about security risks for small children and expensive running costs. A pool may recoup as little as 10 percent of the initial cost and so should not be considered to be a good house improvement.
Never rearrange the interior of your house in a way that reduces the total number of bedrooms to less than three.
Never add a third bathroom to a two-bath house unless you don't care about ever recouping your investment.
Garage are sought after features and will almost certainly recoup an investment.
Consider if your improvement / renovation requires planning permission or building regulation approval.
If you are thinking of taking out a loan to fund your home improvements, read these loan advice article first.
And finally make sure you have re-visited your home and contents insurance and amend level of cover as appropriate
After reading all this you may decide that it's a better idea to move rather than improve. In that case it is still worth looking at what home improvements / renovations you can do to the house as it is often the smaller, relatively inexpensive improvements that turn out to be most worth doing.
Window boxes and hanging baskets add colour and make a home look cared for. Viewed from inside a window box can help to disguise an unattractive outlook as well as increase privacy for overlooked properties.
Cover dated or worn sofas and chairs with large throws in a neutral colour so that they aren't noticeable when people look around.
The cost of replacing a discolored toilet bow, making sure all the windows work or getting rid of dead trees and shrubs in trivial compared with large home improvement / renovation projects such as adding a bathroom, but such things can have a big and very positive impact on prospective buyers. Creating at least a superficially improved looking home will greatly increase the chances of selling your home, as well as upping the potential asking price.
Home Improvements / Renovation- Will they increase the value of your home?" By Alastair Taylor
If you found this page useful please click the +1 button below to tell Google that its a great page!
Please share this page with others, and leave a comment, we value all feedback!
Was this page useful? Do you have something to add? Do you disagree?
If your comments meet our guidelines then we will publish them (you do not need to register!)
Ttradesman - click here to join our network to receive leads from customers in your area
"What about double glazing: will a repair to existing double glazing or a total replacement recoup costs? "
"if we blacktop our driveway will we see any of the money back when we sell our home?"
"There is information on what does not increase the value of a home - not much on what does!"
"useful made me rethink a bit "