Why Should I Extend or Renovate My House?
Undertaking a home extension or renovation can be a daunting prospect. The cost, the upheaval of building work and never having done building work before could all be weighing on your mind.
However, there are many positive reasons to take the plunge. I’ve put together 6 of them in this article, 3 lifestyle and 3 financial.
These aren’t ranked as everyone is different. Let us know what appeals to you:
Lifestyle – make your homework for you
Lives and circumstances change. Maybe you bought your house when there was just one or two of you living there and now you have a family. Or the family has flown the nest. Or you need to make your home more accessible.
As our lives change, we often adapt how we live within the same living spaces. Rooms become taken over for different purposes. This can lead to a cluttered and disjointed home. You may be able to make it work, but the prospect of everything having its own place is very tempting. If you have bought a new house then it will have a generic layout with no one specific in mind. If you have bought an older home then it was probably set up for the previous owners’ lives, which could be very different to yours.
Extending to create spaces that work for you and renovating existing areas to maximise space and configure a home that works perfectly in synch with your lifestyle can both have a hugely transformative effect on your household’s wellbeing. Extensions or renovations can sometimes be wrongly seen as a luxury, for a lot of people they can become a very important means to a happier home life.
Financial – add value for a sale or equity release
The housing market can be up and down, making it tricky to sell a house for most people at the best of times. However, a lot of estate agents will be able to tell you what the majority of house buyers are looking for. For example, it was the case not that long ago that big open plan living spaces were the most desirable, but now it seems to be trending more towards families wanting separate living spaces in their property.
If you do your research into what features are most likely to help sell your house more quickly and for more money, you could find it would make a lot of sense to undertake an extension or renovation prior to putting your house on the market. Always bear in mind who you are targeting with the sale – if you are looking to hit a wide target market then don’t go to niche on the layout or the look!
Another reason to add value is if you will be remortgaging in the near future. Adding value could enable an equity release or give you a better LTV.
Estate agents can give you a rough idea of how much value could be added by doing an extension or renovation. Always err on the side of caution when it comes to prospective valuations though. Remember, your extension costs will be fixed so you’ll know what you’ll be spending, but the valuation of your house could vary for different reasons and you can’t be certain what valuation you will achieve when the work is complete. Do your research and your sums!
Lifestyle – a change is as good as a rest
Changing your home with an extension or renovation could make a big difference to your wellbeing. Even if your changes are more cosmetic than the practical ones outlined in point 1, these changes can be important. Here are some of the changes that could be included in a renovation, or features that could be included in an extension to improve your wellbeing:
Glazing – a change to location or size of your windows, or the addition of roof windows or bifold or sliding doors could create a big increase in natural light into your space, literally brightening your day.
Kitchen – an improved kitchen could make it much easier for you to store food or to enable you to cook more, making the takeaway more of a treat than a staple part of your diet.
Decorating – new colours, new styles, new design to lift the mood.
Extend or layout change – creating a quiet corner to sit with a nice cup of tea or read a book. Or create a new space for the children to play to give you a bit of well-earned peace and quiet!
Landscaping – making a big change to your outdoor space as part of your extension or renovation will lead to a more outdoors lifestyle.
Exercise indoors – whether you have space for a garden building or you can create space in the house, making room for a home gym (whether big or small) could be just what you need to improve your health and wellbeing.
Or maybe you love the area you live but not your house. Your local community can play such a vital role in your life, so having to leave an area you love to find the house that works for you can be a big wrench. If you can maximise the potential of your house and stay put in the area you love, that is a big win.
Financial – invest in your future
If you have money to invest, doing so in property can be a wise choice. On average, most homes will increase in value at a rate of around 4% per year. Investing money in an extension or renovation project can add value to your property, greater than the amount the project cost thus providing a return on your investment that sits in your house value. Let’s do a little sum:
House valuation: £350,000.
Cost of small extension: £40,000.
Confirmed new house valuation after project complete: £400,000.
If the value increases year on year by 4% then after one year if no work is done to this house, it would be worth £364,000. An increase of £14,000.
However, if the project is undertaken then a year later this house would be valued at £416,000. An increase of £16,000.
The difference between those two valuations is £416,000 minus £364,000 which is £52,000. Therefore, the £40,000 investment in this build project has returned a £52,000 increase in the value of the house after one year. That’s a 30% return on the £40,000 investment.
This is a simplified example of how investing in your property could provide a solid return on that investment, but it should be pointed out that the money sits in the value of your house until you sell.
Lifestyle – going green
As a society we should all be looking to do what we can to prevent damage to the environment, no matter whether a big or small change, every positive change helps.
There are many different ways to ‘go green’ with your building project. It can depend on your budget and also your property and location. As part of a building project, you could look to move from gas boiler to a heat pump. Or maybe you have scope to install solar panels? Grey water harvesting is another way of reducing your impact on the environment.
The materials used can also have a big impact on the environment. A major considering is the insulation. Increasing the quality and quantity of your insulation will have a big impact on your power consumption when heating your home. Have your builder investigate the insulation of existing areas – while your house is opened up for building work it’s a great time to beef up the insulation there too. Poor glazing is another source of heat loss, so improving this area of your house will impact on consumption too.
Although these changes involve an upfront cost, it could pay off further down the line with lower bills. And you’ll have the peace of mind that you are doing what you can to lessen your impact on the environment.
Financial – cheaper than moving?
Moving can be expensive. There could be estate agent fees, legal fees, valuation fees, mortgage fees, stamp duty costs and deposits to name a few of the main costs. This soon adds up. Then there is the stress of being in a chain where someone pulling out at the last minute could lead to the whole thing breaking down.
If you have the budget for an extension or renovation and it can bring you the space and lifestyle you are looking for, it could well be worth staying put and putting the money into fulfilling the potential of your own house.
Do your research and your sums. You can compare the cost of extending or renovating with the cost of moving. There is a lot more to consider other than the pounds and pence, but this could be a crucial factor.
