Building an extension to your home can add thousands to its value – but only if you live in the right area.
In some cases, homeowners are not seeing their initial investment pay off, such is the fragility of the property market.
Research has identified 30 places where spending a few thousand pounds on a new conservatory, extending the kitchen to open up on to the garden, or building out the eves to create a fourth bedroom really does add value.
Estate agent Hamptons International identifies central Bedfordshire as the best area to see your investment pay off. A typical extension there will add an extra £5,459 to the value of a home, after construction costs of £51,566, according to the research.
However, in Swindon and Thanet, spending £43,529 on the building work will add only £66.
In Kensington & Chelsea – the London borough with the UK’s most expensive homes, at an average of almost £2m – extending will add £212,706 of value after £45,120 of construction costs.
But, in Burnley, where a typical property costs £92,925, owners could lose £17,180 after spending more than £29,000.
Hamptons used Land Registry, Office for National Statistics and Energy Performance Certificate figures to identify the winners and losers.
Top ten areas you can make profit by extending:
- Central Bedfordshire £5,459
- Canterbury, Kent £5,264
- Castle Point, Essex £4,703
- Maldon, Essex £2,956
- Southend, Essex £2,779
- Milton Keynes, Bucks £2,694
- Braintree, Essex £2,533
- Havant, Hampshire £2,377
- Manchester £2,349
- Hambleton, North Yorks £2,151
David Fell, of Hamptons International, said: “When the cost of an extension is outweighed by the value it adds, an area tends to reach a tipping point.
“Change starts to ripple up and down the street, with investors extending as a matter of course, or getting planning permission prior to selling.”
He identifies Rutland, Leeds and Richmondshire, North Yorkshire, as well as the Suffolk coast, north Dorset and Salford, Greater Manchester as areas set to see greater returns on extension investments.
The property market has been hit by stagnating prices as Brexit worries have hit consumer confidence.
Surveys have shown fewer homes coming on to the market and more people looking to exploit what they have already through extending into the loft space, for example.
However, one of the biggest hurdles is the jump in price between 2, 3 and four-bedroom homes; people simply cannot afford to move, so they extend.
According to Savills, the typical cost of moving up the ladder from a two-bed home to a three-bedroom property in London is £220,086, and from three to four, £387,719.