What adds value to a house?

Author
Discussion

Welshbeef

Original Poster:

49,633 posts

197 months

Friday 4th September 2015
quotequote all
Have asked a few different question here to date and this one consolidates everything.

Is there a ranking and % gain over the investment of any value add works done at a property

IE
Loft conversion
Rear ground floor extension
2 floor side extension
Log cabin

Etc.

jonny996

2,603 posts

216 months

Friday 4th September 2015
quotequote all
when we recently extended ours I asked an agent & he told me the way vales are worked out has changed recently. it used to be number of bedrooms X value off that location, it is now habitable SQM x value of that location.

so loft side & double side if done correctly all add to habitable space if done correctly. Log cabin does not. That is why installing a log cabin is cheaper then extending your house.

FrankAbagnale

1,700 posts

111 months

Friday 4th September 2015
quotequote all
Welshbeef said:
Have asked a few different question here to date and this one consolidates everything.

Is there a ranking and % gain over the investment of any value add works done at a property

IE
Loft conversion
Rear ground floor extension
2 floor side extension
Log cabin

Etc.
I'd say it's relative to the house you're doing the works on. What sort of property, current accommodation, current size, location and size of plot etc.

On a £7m 7000sq/ft house, adding an extension might not add any value. But spending the money on an indoor pool/tennis court might.

On a chalet style house with plenty of ground floor accommodation but limited bedrooms/head height then working on the first floor to increase space would add value.

On a standard two bed terrace with a ground floor galley kitchen and bathroom at the back, 1 1st floor shower room or single story side extension to the kitchen to open it up would probably add the value.

There is a trend at the moment for open plan downstairs living space and I would think if the house doesn't currently have that then there could be a decent ROI if done properly. But again, it just depends on what you currently have.

So in summary, I don't think there is an answer tot he question which helps.

FrankAbagnale

1,700 posts

111 months

Friday 4th September 2015
quotequote all
jonny996 said:
when we recently extended ours I asked an agent & he told me the way vales are worked out has changed recently. it used to be number of bedrooms X value off that location, it is now habitable SQM x value of that location.

so loft side & double side if done correctly all add to habitable space if done correctly. Log cabin does not. That is why installing a log cabin is cheaper then extending your house.
I've never heard of a bedrooms x £psf formula - but would be very interested to see it! Or a value of location x habitable SQM... In fact, "value of location" is variable depending on who views.

I assume that agent couldn't value a house accurately without a floor plan if he uses a formula based on habitable SQM?

I know in London they're very hot on £psf, but of my chums who work there I know they don't use a formula to value but would use a £psf calculation to sanity check their valuation once they have an idea of value.

eskidavies

5,346 posts

158 months

Friday 4th September 2015
quotequote all
Along with habitable space I'd say nice good spec bathroom and kitchen ,done to high standard,wouldn't want to buy house and spend ££££ on updating or changing

Jasandjules

69,825 posts

228 months

Friday 4th September 2015
quotequote all
eskidavies said:
Along with habitable space I'd say nice good spec bathroom and kitchen ,done to high standard,wouldn't want to buy house and spend ££££ on updating or changing
Indeed. IME a top quality kitchen and bathrooms enables a slightly higher price and tends to sell faster too.

Podie

46,630 posts

274 months

Friday 4th September 2015
quotequote all
eskidavies said:
Along with habitable space I'd say nice good spec bathroom and kitchen ,done to high standard
Agreed.

TA14

12,722 posts

257 months

Friday 4th September 2015
quotequote all
FrankAbagnale said:
Welshbeef said:
Have asked a few different question here to date and this one consolidates everything.

Is there a ranking and % gain over the investment of any value add works done at a property

IE
Loft conversion
Rear ground floor extension
2 floor side extension
Log cabin

Etc.
I'd say it's relative to the house you're doing the works on. What sort of property, current accommodation, current size, location and size of plot etc.

On a £7m 7000sq/ft house, adding an extension might not add any value. But spending the money on an indoor pool/tennis court might.

On a chalet style house with plenty of ground floor accommodation but limited bedrooms/head height then working on the first floor to increase space would add value.

On a standard two bed terrace with a ground floor galley kitchen and bathroom at the back, 1 1st floor shower room or single story side extension to the kitchen to open it up would probably add the value.

There is a trend at the moment for open plan downstairs living space and I would think if the house doesn't currently have that then there could be a decent ROI if done properly. But again, it just depends on what you currently have.

So in summary, I don't think there is an answer to the question which helps.
OTOH I think that that is quite a good answer.

Although from the OP's other threads I think that he's asked the wrong question; I think he means what works can be done that would add at least the value of the works to the value of the house.

Welshbeef

Original Poster:

49,633 posts

197 months

Friday 4th September 2015
quotequote all
TA14 said:
OTOH I think that that is quite a good answer.

Although from the OP's other threads I think that he's asked the wrong question; I think he means what works can be done that would add at least the value of the works to the value of the house.
That's exactly what I means.



I thought
Loft conversion up to 150% of what you spend.
2x floor extension double to 2.5x what it cost you.

Or have I got this rather wrong in that TV shows identify people do pretty much all the work themselves and somehow manage to source the materials at a low cost for quality parts IE in the real world simply not likely to replicate.

anonymous-user

53 months

Friday 4th September 2015
quotequote all
Talk to a friendly EA - they should know.

TA14

12,722 posts

257 months

Friday 4th September 2015
quotequote all
Welshbeef said:
Or have I got this rather wrong in that TV shows identify people do pretty much all the work themselves and somehow manage to source the materials at a low cost for quality parts IE in the real world simply not likely to replicate.
Most TV shows work on this sort of formula: buy house for £300K, estimate spend at £50K, actual spend is £80K, sell for £410K so £30K profit and ignor the fact that rising house prices in the time it took to make the show meant that if they had done nothing they could have sold for £400K smile

Welshbeef

Original Poster:

49,633 posts

197 months

Friday 4th September 2015
quotequote all
TA14 said:
Most TV shows work on this sort of formula: buy house for £300K, estimate spend at £50K, actual spend is £80K, sell for £410K so £30K profit and ignor the fact that rising house prices in the time it took to make the show meant that if they had done nothing they could have sold for £400K smile
Yep makes sense.

Though if your say turning a 3 bed into a 4 bed (by adding additional space not making other rooms smaller and adding additional bathroom/en suite or say walk in wardrobe to the master makes it very appealing.

Condi

17,089 posts

170 months

Friday 4th September 2015
quotequote all
Depends on the area, current house condition, neighbouring properties, etc etc

If you're in an area of 200k family terraced houses then people will be looking for something clean, tidy and low maintenance. If you live in an area of £750k country estates then character and feature bathrooms are going to be of more value.

p1esk

4,914 posts

195 months

Friday 4th September 2015
quotequote all
I've heard that if you're looking to sell your house, the value doesn't increase much by putting in a new kitchen and bathroom. The thinking was that many new owners will rip them out and have their own choice, so to a large extent it's money wasted for an existing owner to do it just before selling.

Busa mav

2,556 posts

153 months

Friday 4th September 2015
quotequote all
As Condi above mentions , you need to have a serious and honest look at property values in the area.

I think your multiplier for extension cost to added value are way over the top.

Start with looking at what your house has / has not at present, if you propose spending 100k on the property , have a look at what the competition will be providing when you come to sell.

Without knowing where the property or present value is , nobody can answer your question..

Whitley Wood or the better parts of Earley will bring a totally different response from people in the know.


sealtt

3,091 posts

157 months

Friday 4th September 2015
quotequote all
The only thing which really adds value is work carried out at a discounted rate, whereby the profit is paid to the person through increased house value rather than a salary.

Example, take a house that needs repainting. You could pay a professional to do it, in which case the house price would probably rise more or less in line with the cost of the work done, maybe leaving a couple of % extra for you as it saves the buyer the hassle. Or you could do it yourself, rather than receiving a salary for painting the house, you receive the salary through the increased value of your house.

This can be done through a number of ways, repair, remodel, extensions, interior decoration, etc.

However, if you are a regular person with no particular skill in any of these areas, then you will likely just be taking money out of one hand (paying the contractor's profit) and recouping it in the other hand (your equity value in the house). You would hope that you'd gain a little profit yourself for the risk of carrying out the work and of course the time value of disruption and so on. However, things can work both ways - maybe they don't like the work you've done, value reduces.

The best thing you can do is call your preferred local agent and ask them what helps sell the houses in your area. Though of course what helps houses sell in 2015, may be quite different to 2020, so if you aren't selling for a little while... who the hell knows!

Welshbeef

Original Poster:

49,633 posts

197 months

Friday 4th September 2015
quotequote all
Well very nice 2floor extension sold for £250k-265k more than ours or same as ours sold for at the time.

Loft conversion "hipped" with en suites seem to sell for £80-100k more rest of property dependant, one has converted to a 5 bed without going into the loft (but is 2x double and 3x single).

We would go for 4x double or 5x double with the loft from a personal choice perspective

eliot

11,365 posts

253 months

Friday 4th September 2015
quotequote all
Had mine valued by an EA and they just multiplied the sq ft by a value.
I have fairly large log cabin with a shower and toilet, sleeping room and office space and they said it adds nothing to the value.

Welshbeef

Original Poster:

49,633 posts

197 months

Friday 4th September 2015
quotequote all
eliot said:
Had mine valued by an EA and they just multiplied the sq ft by a value.
I have fairly large log cabin with a shower and toilet, sleeping room and office space and they said it adds nothing to the value.
Out of interest does it have official planning approval for the bedroom - if not then it's simply a log cabin which clearly you can use to sleep in but cannot sell it stating x bedrooms and include this.


paulrockliffe

15,639 posts

226 months

Friday 4th September 2015
quotequote all
As said above, it does vary massively depending on what's there already, where you live etc.

I'd also agree that where you're paying someone to do the work you're unlikely to make much money, even if you do judge the market exactly right.

By far the best approach is to work out what you want to do, then do it and live in the house for 10 years, so you can write the cost off against the benefit and then cash in a bit extra on capital appreciation and inflation.

As an example, our house is a normal three bed terrace type design, except it's a detached house with a decent garden; the original owner was the builder that built the terrace next to us and he kept the same design, but the best plot for himself. I would think that we would get more money for an identical loft conversion to next door because the 4-bed buyers will pay the extra for mine because the garden is more important for a family home, but would be put off by the lack of garden next door.