The Ultimate Guide:
How To Add Value To Your Home

Keep reading to discover…

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Basic rules & general wisdom

Rule #1

Consult the experts before you commit to any home improvement (with the intention of adding value).

• Speak to local estate agents (especially any that are also RICS qualified Surveyors) to find out what buyers are looking for and whether your property presents any opportunities that have the potential to add significant value.
• For instance, if your kitchen is looking tired, a good local estate agent should be able to advise you whether to replace it with something mid-range, whether spending more will give you a better return, or indeed whether to bother at all as the new buyers may want the opportunity of putting their own kitchen in.

Rule #2

If you’re extending, check the ‘ceiling’ for sizes and prices in your immediate area.

• Every road can be its own micro market, so make sure you’re not investing more than it’s possible to recoup on the sale price.
• Again, estate agents that know your road well will be able to advise you of the maximum you can expect to achieve in your particular area.

Rule #3

If you plan to sell for a profit, adding value is not about making improvements you like; it’s about satisfying demand.

• While it might love to have extra reception space, if the demand in your area is for an extra en-suite bedroom, that’s where you’ll see a real uplift in the value of your house.

Does it add value or just make your home easier to sell?

• As a rough guide, redecoration and minor upgrades to fittings are easy to do and can add real value for little cost or at least make your home easier to sell.
• People tend to look for either a ‘show home’ to buy where they have little work to do or a wreck. What people don’t like is something ‘in between’ that’s half finished.
• Adding extra usable space to the property – either through extension or conversion – can give a good return, as can replacing things like the heating system, windows and kitchens and bathrooms.
• Essentially, anything that materially improves the structure and infrastructure of your home – the larger projects that are considered costly and disrupt day-to-day living in the property – will either be something buyers want to do themselves or will want done to show home standards.
• Whether extra space adds value or not very much depends on local demand. If your property is a three bed and demand for that is high, creating a four or five bed in an area where there are plenty to choose from won’t necessarily add any value.

Expensive fittings or Homebase?

• This is one of the most commonly-asked questions when it comes to home improvements. While most people are looking to keep their outlay as low as possible, there’s a fine balance between not spending too much and achieving a look that doesn’t scream ‘cheap’.
• Cheap fittings almost always look cheap and don’t stand up to wear and tear, so they’re usually a false economy.
• At the other end of the scale, buying the most expensive fittings – a top-of-the-range bathroom suite, hardly ever provides a return on investment.
• Generally speaking, the key is to head for something in the middle, that suits the style and price bracket of your home.
• The biggest mistake you can make with your choice of fittings is to overspend on a modest home – for example, fitting solid marble work surfaces in the kitchen of a modern, 3-bedroom semi-detached property.
• While buyers are bound to be impressed (or hate it!) it’s not something they’ll be willing to pay extra for at that price point in the market.
• The exception to this kind of moderation is if you live in a prime area, where your neighbours’ houses are high-spec and luxurious. In this case, buyers tend to be looking for stunning design and the latest finishes. In a competitive and desirable micro-market, buyers will pay more for the best property on the road.
• It’s about finding a balance and seeking expert local knowledge to make the decision of what you should – and shouldn’t – do.

What adds the most value to a house?

Usable square footage

Adding rooms is where you may see a good return on investment, however, there are a few rules:

1. Make sure you’re adding valuable, usable space because not all square footage is created equal. If the property already has a large dining kitchen and two reception rooms, building another ‘snug’ or ‘den’ is highly unlikely to add value in the same way as if you added an en-suite bedroom, for example.
2. In general, the more the extension feels as though it’s part of the original house, the greater its appeal will be, so it’s worth spending a little more money to ensure your architect comes up with plans that are sympathetic to the property’s existing style and feel.
3. Be very careful that you don’t exceed the price ‘ceiling’ for the type and size of property in your area. For example, if you live in a road full of 3-bedroom homes, extending to make yours a 6-bedroom, 4 reception-room home may seem like a good idea, but it won’t make you any money when it comes time to sell. People looking for – and willing to pay for – a 6-bedroom home may well want to live in a more prestigious neighbourhood, alongside other similar sized homes. The main interest you’re likely to see is from people in the market for a 3-bedroom home who hope they might be able to get a lot more space for not much more money.

Converting loft space

• This is almost always a winner.
• In a survey by the National Association of Estate Agents in March 2017 [1], half the agents surveyed said that the best modification a homeowner could make was converting the loft to an en-suite bedroom.

Kitchen & Bathrooms

• Functional, sleek and tasteful modern kitchens and bathrooms will almost certainly add value and are a very worthwhile investment to consider prior to selling.
• As a general rule of thumb, if something needs doing in a property, owner-occupier buyers tend to overreact and knock more than the actual cost of doing the work or worse, decide not to offer at all.
• You can find yourself attracting only professional buyers whop are looking to make a profit margin and so will be offering significantly less than an owner-occupier.
• So for ‘big ticket’ items like kitchens and bathrooms, you can add value if they’re dated, unless of course the demand from buyers is for a ‘wreck’ to renovate as opposed to a ‘show home’.
• Bathrooms, in particular, are becoming increasingly important. Older properties will often have up to four bedrooms with only one bathroom and that’s just not enough for modern needs.
• Adding a family bathroom can increase a property’s value by around 5%[2] and, even if it means taking space away from a bedroom, adding an en-suite is a good move in the majority of cases.
• In London, a good en-suite could add between 3% and 5% to a London home valued around £1.5 million – that’s between £45,000 and £75,000 – according to Robin Chatwin, Head of Savills South West London.
• However, these are all ‘anecdotal’ figures, adding value depends very much on local demand and supply factors.

Gimmicks

• Money spent on things that might be regarded as ‘gimmicks’ is usually money wasted.
• So, if you really enjoy a jacuzzi bath, by all means put one in, but don’t expect other people to consider that it has any particular value.
• Similarly, most people would certainly enjoy having a dedicated wine fridge in the kitchen, but it’s a luxury, not a necessity, and is unlikely to add real value to your home unless that’s the spec expected in your local micro market.

Parking

• In areas where parking is extremely limited, creating a parking space is highly likely to add value.
• People rarely use front gardens these days, so turning what frontage you have into off-road parking, in an area where most people have to park on the road, can make your property much more desirable.

Planning permission

• Finally, if you don’t want to actually undertake any work, simply gaining planning permission for any of the above can add to the value of your home.
• While it won’t necessarily give you a huge profit, it’s certainly worth running the figures to see the difference between doing the work and selling and just securing planning and selling.
• Again, advice from quality local estate agents will be invaluable here.

Top 10 most popular home improvement projects

Taking into account various surveys recently carried out by insurance companies, including Sainsbury’s Bank home insurance, gocompare.com and Direct Line[3][4] here are the top ten projects undertaken by homeowners over the past couple of years:

1. Rear and side extensions
2. New kitchens and bathrooms
3. New boiler
4. Adding a conservatory
5. Adding a bedroom and bathroom through a loft conversion
6. Converting the garage into living accommodation
7. Erecting outbuildings, such as a home office or garden room
8. Increasing light via bi-folding doors and skylights
9. Knocking through reception space to create a kitchen/dining room
10. Installing solar panels

Bare in mind these are the most popular projects, not the smartest or best money making projects.

For example adding solar panels rarely adds real value to a property (they are a turn off for many buyers) but can reduce your utilities bills of course.

Top tips:

1. Remember to inform your insurer of any works that may affect the security of the property and then, when the project is finished, update them of changes to the size of the property.
2. Once the work is done, carefully file all related paperwork such as building regulations and planning permissions because these will be needed when it comes time to sell the property.

How much value does it add to a home?

Here’s a spreadsheet showing:

1. What are considered to be the most worthwhile improvement projects.
2. How much value they’re estimated to add to a property.
3. The approximate cost of each project.
4. The permissions or approval needed for each project.

But remember, these are ‘average’ returns, they are not guaranteed and very much depend on the local demand in your area for property.

 

How much value does a ‘______‘ add to a home?

Home improvement project	Do you need permission?	Does it improve saleability?	Does it add value?	Cost (approx.)*	Value added (approx.)
EXTENDING / CONVERTING
Add bedroom	Planning permission & building regulations	Y	Y	£10,000	10%
Add bedroom + en-suite	Planning permission & building regulations	Y	Y	£12,000	10%
Add en-suite	Planning permission & building regulations	Y	Y	£1,500-£3,000	5%
Extra bathroom	Planning permission & building regulations	Y	Y	£2,500-£6,000	5%
Extra downstairs room	Planning permission & building regulations	Y	Y	£10,000	10%
Conservatory	Usually allowed under Permitted development	Y	Y	£4,000-£10,000	5%
Convert garage	Building regulations unless Listed building or conservation area	Y	Y	£10,000	5%
Loft conversion	Usually allowed under Permitted development & building regulations	Y	Y	£15,000-£40,000	15%
Basement excavation	Planning permission and building regulations	Y	Y	£10,000	15%
Get PP for extension	-	Y	Y	£2,000	Depends on what PP is for
Fix damp	-	Y	-	£1,000	0%
Fix subsidence	Building regulations if underpinning	Y	-	£2,000	0%
INSIDE
New kitchen	Building regulations approval often needed	Y	Y	£5,000	5-10%
Remodel kitchen	Building regulations approval often needed	Y	Y	£2,000	5%
New bathroom	Building regulations approval often needed	Y	Y	£1,000-£10,000	5%
Remodel bathroom	Building regulations approval often needed	Y	Y	£500-£2,500	5%
New boiler	Building regulations approval or CORGI or Gas Safe registration	Y	-	£2,000-£5,000	0%
Rewiring	Building regulations approval	Y	-	£3,500	0%
Insulation	Building regulations if going into cavity walls	Y	Y	£500	£2,000
Interior redecoration	-	Y	Y	£1,000	5-10%
central heating	Building regulations approval	Y	Y	£3,000	5%
New flooring	-	Y	Y	£4,000	£6,000
OUTSIDE
New roof	Building regulations approval	Y	-	£4,000-£6,000	0%
New windows	Building regulations approval	Y	Y	£1,000-£35,000	5%
Paint exterior	rules apply	Y	Y	£1,000	2-3%
Parking space	Planning permission, drop kerb permission	Y	Y	£10,000	£20,000-£50,000
Carport	-	Y	-	£1,500	0%
Solar panels	Building regulations approval	-	-	£6,500	energy bill savings
Privacy fencing	rules apply	Y	-	£250	0%
Decking	rules apply	Y	-	£300	0%
Patio	-	Y	-	£500	0%
Landscaping	-	Y	-	£2,000	0%
Shed	-	Y	-	£250	0%
Remove Japanese Knotweed	rules apply	Y	-	£2,000-£5,000	0%
LUXURIES
Swimming pool	rules apply	-	-	£10,000	0%
Hot tub / jacuzzi	rules apply	-	-	£3,000	0%
*All figures approximate for a 1,500 sqft 3 bed home of standard brick construction. Disclaimer: Everything above is variable and dependant on area, local authority rules, size of property and local supply vs. demand factors.

How to work out if your project makes sense

You can find out much of the information you need from carrying out online research. Rightmove, and Zoopla will show you details of properties currently on the market and recently sold, including floor-plans and information about recent improvements, with historical sales figures.

Using these portals:

1. Take some time to identify properties that have sold in your area in the last year, both those similar to your home as it stands and those that have been improved to the size/standard you’re considering.
2. Look at the historical sales data for those properties and get a feel for how much the improved properties have increased in value versus the unimproved ones. A simple spreadsheet will help you record and analyse your research.
3. Cost out the work in as much detail as you can and see how the uplift in value compares to the spend.

This should give you a picture of which projects seem to be worthwhile so you can make an initial decision on whether your plans make sense.

The next step is to speak to some local estate agents and get their input on what they feel would be most valuable in the current market.

They are dealing with buyers every day, so really are the best people to advise you on what’s most in demand and what people are willing to pay for various improvements.

The other expert who should be able to guide you if it is a major project is your architect, assuming they’re experienced in conducting projects locally.

Consult two or three to get a feel for which is really looking to help you achieve a sympathetic extension that will provide at least a 150% return on cost…

For example:

• Property value before works = £1,000,000.
• Extension cost = £100,000
• Property value after extension = £1,250,000.
• Profit = £150,000 (£250,000 – £100,000)
• £150k profit is 150% return on £100k spend

Find architects: Click here to find local architects

What improvement projects are worth considering before selling?

The essentials

There’s a great deal you can and should do before putting your house on the market, that doesn’t need to cost much – if anything.

Create a good first impression

If the outside impresses a buyer, they’ll be in a positive frame of mind as they enter the property – likewise, the reverse is true! – so take a little time to make sure the property and front garden look smart and there is somewhere for your prospective buyer to park their car (if applicable).

Tidy and clean inside

You don’t need to make your home impersonal – in fact, buyers generally want to feel a home is loved and enjoyed – but do tidy up, put clutter into storage and make sure the house is cleaned thoroughly from top to bottom.

If potential buyers see you take care of the surface of the property, they’re likely to have fewer concerns about the fabric of it.

Top tip: Check out https://twitter.com/BadRealtyPhotos

Make the most of period features

While most buyers want an up-to-date house, they overwhelmingly want as many original features as possible if buying old, so don’t be tempted to replace a lovely Edwardian fireplace with an ultra-modern (albeit stunning) gas fire. That’s likely to be seen as a downside and reduce your chances of getting your money back.

Show off your storage

Good storage is highly desirable, so tidy up your cupboards and loft space. It might even be worth creating storage spaces by closing in under-stair areas and building floor-to-ceiling wardrobes in bedrooms.

Pro tip: Ask your local estate agents for their opinions but don’t be surprised if they’re hesitant in giving them to you – the risk to offend is high here!

As such, worth calling in a trusted friend or family member to critique your home and help you see it through the eye’s of prospective buyers.

More: Your room-by-room home staging guide

For the brave

Gaining planning permission

If you don’t want to get involved in actually carrying out work but know your house has the potential for extension, it’s probably financially worthwhile for you to obtain planning permission.

It can be amended and resubmitted at any time, so the works you propose are not set in stone.

It will certainly make you home more saleable and can even add up to 10% to the value of your home [6].

Take, for example, gaining planning permission for a two-storey extension on a semi-detached home: the architect’s fee for drawing up plans and submitting the planning application should be in the region of £2,000 [7]. With the average price for a 3-bedroom semi-detached in the UK currently standing at just over £200,000 (March 2017), if planning adds between 5% and 10%, that’s a £10,000 to £20,000 gain, five to ten times your investment [8].

Don’t forget, planning permission is only half the work involved in extending, building control is a major feature of the project and you need to cost this in from the start if you intend to complete the build yourself.

Extend the lease

If you have a leasehold property that has 85 years or fewer remaining on the lease, it’s advisable to look into extending it.

Below 80 years, mortgage lenders and solicitors start to become hesitant to proceed, whereas if you can negotiate a decent extension that can add value and make for a quicker and easier sale.

The cost is up to the freeholder, but a 90-year extension tends to range from £8,000 to £26,500, depending on the current length remaining – the lower it is, the more expensive.

More: Your step-by-step to extending your lease

New kitchen and/or bathroom

Consult local estate agents before proceeding, but if you can bear the upheaval, it may be worth remodelling dated facilities as these two rooms are the ones that sell houses.

How to finance your renovation project

You may have sufficient savings to cover the cost of the works but, if not, the most common financing solutions are:

1. Adding to your mortgage.
2. Taking out a personal loan.
3. Using a renovation company’s finance offers.

Additional mortgage borrowing

• Your lender will require a formal valuation on how much your property will be worth following the proposed improvements.
• Assuming you’ve researched your project and have sufficient equity in the property, there shouldn’t be any issue with the viability of this, from the lender’s perspective.
• The additional borrowing is generally spread over the remaining lifetime of your existing mortgage and by financing the project in this way, you can benefit if you have a low interest rate on the loan, as it’s secured on the property.
• This does, however, mean that your home is at risk if you default on the repayments.

Personal loan

• Personal loans tend to attract a higher interest rate than a mortgage.
• But they can be lent on a shorter time frame, for example five years,
• You can usually borrow up to £25,000 and get a quicker decision than is possible via the mortgage application process.
• Because the loan is unsecured, it also means your home is not necessarily at risk if you default.

Renovation company finance schemes

• It is worth investigating these in detail before you sign on the dotted line because companies can offer anything from ‘interest free’ loans (for the work you carry out) to high interest rate loans that a poor value for money.
• You may also find that because they are offering ‘interest free’ the cost of the works is higher. This is not always the case but it is something to watch out for.

Bottom line:

If you aren’t sure the best way to move forward, check all three and compare them yourself.

Or contact an independent financial advisor because if you’re spending tens of thousands of pounds this is just the kind of thing they can help you make the right decision on.

Buying neighbouring land

Buying land can be a good idea but, as with other types of improvement to the property, you need to do your research.

While you might think more land would automatically increase the value of your home, that’s only true if a buyer wants it!

If a property comes with a neighbouring field, for example, that’s probably chiefly of interest to people who own horses or, if it’s possible to get planning permission, developers.

Other buyers may see it as being extra hassle to maintain.

On the other hand, if you have a family home with a very small garden, it may be well worth trying to secure some extra land to make it larger and more suitable for the house.

You could make a neighbour an offer for a portion of their garden, buy a piece of adjoining land from the council or approach a farmer or landowner about extending your boundary into what’s currently their field.

Top tip: Anyone can apply for planning permission on a piece of land – you don’t need to be the owner.

Planning permission (quick guide)

• Generally speaking, planning permission is needed for any building works, which may include extensions and conversions.
• Unlike building regulations, which are nationally consistent, planning regulations tend to vary from one local authority to another, so it’s vital you consult your own planning department as early as possible in the process.
• It’s also advisable to work with an architect who has experience of successfully completing projects in the local area.

Outline planning permission

• This is where the principle of development has been granted, although with no further detail, so there is no guarantee of the size or type of property that could be erected or even where the access might be.
• So it’s better to apply for full planning permission, even if the plans you submit are not necessarily what ends up being built.
• Often, people will initially apply for something larger than they intend to build so that they can be fairly sure their final application will be accepted, but seek advice from local experts who work with the planning department on a daily basis.
• Because there are so many little reasons why a planning committee might refuse an application, it’s a good idea to work with an experienced local planning consultant, who knows how the council works and can help ensure your application has the greatest chance of success.
• You should get a decision within eight weeks from submission of your application.

Top Tip: Gaining planning can certainly add value to your home, particularly if you can show prospective buyers the potential when they view.

Have the planning drawings out and on show, but make sure you have done your research before you apply.

Learn more: https://www.planningportal.co.uk/

Permitted development rights (quick guide)

It’s important and hugely beneficial to you to know that there’s a fair amount of work you can carry out without the need to obtain planning permission, under ‘Permitted Development’ rights, depending on the type of home and area you live in.

Works include:

• Erecting outbuildings, such as garages, playrooms and workshops – anything used in an ‘ancillary capacity’ to the main house
• Small extensions (see: Planning Portal for caveats)
• Building conservatories
• Putting in new windows and skylights
• All internal changes
• Erecting walls and fences
• Constructing decking
• Creating a parking space
• Installing solar panels

This means you can make your property much more desirable without having to go through the planning process, which saves you time and money.

Although you can find out most of the information you need online, via www.planningportal.co.uk, it’s always a good idea to speak to a local planning officer to double-check that you don’t need planning permission.

However, don’t forget, you will still need to follow building regulations and to some extent this stage can be harder and more expensive to go through than securing planning.

There are also exceptions to the rules, for example properties which are Listed or in conservation areas or are flats or have other restrictions may not be allowed to make changes without permission from the Local Authority or Freeholder.

Read the rules: Permitted development rights for householders

Building regulations (quick guide)

‘Building regulations are minimum standards for design, construction and alterations to virtually every building. They are developed by the government and approved by Parliament.’ – Planning Portal

Building regulations are different to planning permission, so be aware that you might need to obtain both for your project.

You can either apply to the Local Authority Building Control service or seek approval from a private Approved Inspector.

You should approach them before any building works get underway, so they can advise of the standards that need to be met.

Both you and the contractor carrying out the work are responsible for ensuring the works comply.

Key areas where building regulations apply:

• Building or extending premises
• An alteration involving work that temporarily or permanently affects compliance relating to structure, fire safety or access to and use of buildings
• Installation or extending a service or fitting that’s controlled under the regulations, e.g. a kitchen sink
• Cavity wall insulation
• Underpinning of foundations
• Renovation of a thermal element
• Changing a building’s energy status
• Gas and electric changes
• Glazing such as windows or doors being fitted

In addition, it is essential to be aware that for most properties, your water drainage system is now the responsibility of your Water Company to maintain.

As such, if you want to extend your property, you will need to double check initially whether you will be building over their pipework. If you are, you cannot proceed without their permission.

Useful links:

• Government guidance on Planning permission and building regulations
• Planning Portal’s explanatory notes & guidance on Building Regulations
• Government Building Regulations Legislation 2010
• Approved Building Regulation compliance documents
• Find your local council building control team
• Approved Building Regulations Inspectors directory
• Building (Approved Inspectors etc.) Regulations 2010

Choosing your team & getting quotes

For a successful project, you need to find the right people to work with, research their credentials and make it clear what you need and expect from them.

In todays more ‘transparent’ world, there are no excuses for instructing a ‘cowboy’ builder. As long as you do the research yourself, you should be able to find properly qualified people to help.

But that means you have to do the research, not respond positively to someone that comes and knocks on the door or who appears charming but wants cash only as they don’t pay any taxes.

Although paying cash can save you money on your build, if it goes wrong it means you have no guarantees or warranties to protect you and put the work right, even if the tradesperson falls sick or goes bust.

If you’re doing something like an extension, you’re probably going to need to work with most, if not all of the following people:

From the local authority:

• Planning Officer
• Building Control Officer / Building Inspector

Independently engaged:

• Planning consultant
• Architect (member of RIBA and ARB)
• Builder/project manager (member of FMB)
• Electrician (registered competent person)
• Plumber (Gas Safe registered and ideally Water Safe registered)
• Plasterer (preferably qualified)
• Glazer (FENSA member)
• Painter/decorator (preferably member of PDA)
• Carpenter (ideally a member of the IOC)

For the council officers, it’s a matter of contacting them early, explaining what you want to do and getting a feel for what they’ll be looking for in order to grant approval.

For the other specialists you’ll need on the team, the most important thing is that they have experience in the type of project you’re carrying out, ideally in the local area.

In many cases, both your architect and a planning consultant should be able to give you some good advice on the best way to carry out the improvements to get the greatest uplift in value.

Getting quotes

1. Always get at least two quotes, making sure that for your contractors they’re broken down into materials and labour and include VAT.
2. Ideally, get a fixed price for the whole project or at least a specified contingency so you know what your maximum spend will be.
3. When it comes to paying for work, you shouldn’t need to pay anything in advance – a good tradesperson should have credit accounts.
4. Always hold back 10% at the end of the job until you’ve ‘snagged’ and are happy that the work has been carried out properly.

Frequently asked questions

The answers below are a general, not definitive so please check answers with your Local Authority as different rules can apply to different areas and properties.

How high can you build without planning permission?

If it’s a single-storey extension, 4m, unless it’s within 2m of a boundary, in which case, 3m. It must not be higher than the eaves and ridge of the existing house.

Do you need planning permission for a conservatory?

It depends on the size, always check with planning first, but often it comes within Permitted Development Rights

Do you need planning permission for a garden shed or summer house?

Not necessarily, but always check as you may be in a conservation area or if it takes over 50% of your garden, normally though it is within your Permitted Development Rights

Do you need planning permission to build a porch?

Check first as you may have a property that is Grade 2 listed or one which is in a conservation area, depending on size, it may be within your PDRs.

How much does it cost for a new kitchen?

Around £8,000 for an average property worth around £250,000. The caveat is that the spend must be appropriate to the house, so if it’s a £1.5m home, you’d be looking at £25,000+.

Links & helpful resources

Planning Portal – Home of UK planning information

GOV.UK – Planning permission and building regulations

Planning & building regulation info – Interactive guides from the Planning Portal

Houzz – Online inspiration for your renovation or design project

Homify – More online design inspiration and interior advice advice

Design for me – Matchmaking service for homeowners & designers

Homebuilding.co.uk – Establish online magazine with decent advice guides

Build cost calculator (London specific) – Excellent information & tool from 2PM Architects

Build cost calculator (regional) – Handy tool from pay-as-you-go architectural & interior design service provider

Related guides

• How much is your house worth?
• House prices and house price indices explained
• The truth about your Zoopla estimate