Homeowners see value of home increase by 19% on average after making home improvements

Research from Post Office Money^[1] has revealed that homeowners who make home improvements are seeing their properties enter the market at a significantly higher value than other similar homes.

Homeowners added an estimated average of £40,000 to their properties by doing home improvements in the past five years, with an average spend of £14,015
Garden landscaping, a gym, extension or walk-in wardrobe are likely to increase the value of a property
Three out of five (64%) homeowners made improvements to their homes over the last five years – spending £295bn in total across the UK

Analysis based upon the median asking price of a three-bed semi-detached home in the UK (£286,000) found that properties with improvements such as garden landscaping, a new kitchen, extension or walk-in wardrobe were on the market for more than 19 per cent higher than the local median asking price^[^2].

As property prices fall, homeowners are taking steps to make their homes competitive. Three out of five (64%) homeowners have made improvements to their homes over the last five years – spending £295bn in total, an average of £14,015 each.

Those who have made changes to their home estimated that the improvements increased the value of their property by £40,000, from an average of £210,000 before the improvements to £250,000 afterwards, an average increase of approximately 19%.

The home improvements^[3] that tend to increase the value of a home:

Improvement	Estimated cost of improvement^[^3]	Properties with this improvement (% increase on market average)
Garden landscaping	£2,750	77%
Gym	£10,000	44%
Extension	£80,000	37%
Walk-in wardrobe	£3,400	34%
Jacuzzi/hot tub	£6,000	27%
New kitchen	£7,500	26%
Swimming pool	£30,000	22%
Basement conversion	£90,000	17%
Conservatory	£9,000	10%
Driveway	£25,000	9%
Wet room	£7,500	7%

(Source: Opinium Research)

Chrysanthy Pispinis, Post Office Money comments:

“Over the past few years, house price growth has slowed, so homeowners have turned to other options to add value to their homes – with renovations being a clear opportunity. Making the right changes to your home can increase its market value significantly; if improving your home’s asking price is your priority, it’s important to keep in mind the cost of the improvement and the value it could add.”

While only 5% of those who have made home improvements in the past five years did so with the express intention of moving, one in four improvers (28%) did so because they thought it would be a good investment and would add value to their property. The most popular reason for making home improvements was to improve the look of a home (59%).

In order to fund renovations, three quarters (74%) of home improvers used their savings, one in six (16%) used a personal loan or credit card, while one in sixteen (6%) used equity release or mortgages.

Chrysanthy Pispinis continued:

“Home improvements are not all about making changes which add value for re-sale; 63% of the homeowners we polled had no plans to move. Renovations allow homeowners to create homes that reflect their needs and tastes, with the potential added benefit of adding value in the long term.”

Most common improvements made in the last five years (2019)

1.	New kitchen	25%
2.	Garden landscaping	18%
3.	New shed	16%
4.	Decking/patio	14%
5.	Driveway	12%

^[^1]Research conducted by Opinum on behalf of Post Office Money between 18 and 24 January 2019. 2,001 online interviews with UK homeowners

^[2] Opinium conducted the research based on a series of searches of the Zoopla website. In each city a series of searches were carried out based on a series of search algorithms to ascertain how many properties were on the market that had particular features. The median house price of these properties was then recorded.

^[³^] Features cost estimates were calculated based on evaluation of suggested costs on popular home renovation websites in February 2019

Kindly shared by Post Office Money