Date Published 07 September 2012
Nationwide shows the cost and value of home extensions following relaxation to planning laws
Adding an extension or a loft conversion to your home could increase its value by almost a quarter, according to research by Nationwide. In addition, the Society has changed its mortgage proposition for further advances, putting borrowers into an excellent position to take advantage of the new relaxed planning laws announced by the Government today.
Nationwide's House Price Index Special Report looked at the value of improvements made to an average three-bedroom house. Nationwide found:
-Creating an extra bathroom could add 6% to the value
-Adding another double bedroom can push up the value by 12%
-Building an extension or loft-conversion to create a double bedroom and en-suite bathroom could add 23% to the value
-Increasing floor space by 10% can add 5% to the average value
The price for building an extension can cost, on average, around £1,000 per m2 or £23,000 for a single storey and £76,000 for a double storey.
For people living in more expensive parts of the UK, such as London, where moving from a three bedroom to a four bedroom property carries a £90,000 premium on average, extending may well be the only solution for the growing family.
Commenting on the Special Report, Robert Gardner, Nationwide's Chief Economist, said:
"With housing market demand still very weak, increasing numbers of homeowners may opt to improve rather than move. Our research assesses the factors that affect the value of homes, and the potential to add value.
Having more useable space is generally thought to be consistent with better quality accommodation and people are prepared to pay for it. A 10% increase in floor space, other things equal, adds 5% to the price of a typical house, while adding space equivalent to the size of a double bedroom to a two bedroom house can add around 12% to its value.
A second bathroom is also a favourite with homeowners and our research shows that creating an additional bathroom can add 6% to the value of the average house. Homeowners that add a loft conversion or extension incorporating a double bedroom and a bathroom can add about 23% to the value of an existing three bedroom, one bathroom house."