Does office space add much value?

[Hairydogmummy]

Me again! We're still looking for a house! The latest possibility, having given up finding a period property, is a new build. It's on a small exclusive development of individual period style homes, surrounded by green belt and is very high spec indeed. Everything you could wish for. It also comes with a decent sized office space in a purpose built building across the courtyard, in fact all 23 of the houses do. Most of the homes on the development are 650k plus and are much bigger. Thing is, 'our house' would be quite small 3 bed and is mews style, not detached. It's 495k and they won't budge on price. For context, it's one of the priciest villages in the area (north west) but you could still pick up a much larger detached property for the same price on regular new build estate not far away, it would just be lower spec and overlooked. Or if one came up a larger genuine period property maybe needing a few bits done. So my question is how much extra would you pay for a house with its own home office space a short stroll from your house? I should add there's a service charge of £80 a month for communal areas and sewage plant as not on mains drains and unadopted road.

I would take mews to mean attached and no garden? Service charge too so almost like buying a flat, really.

The spec will age anyway, so I wouldn’t choose this house over a detached one unless the spec is awful, eg lino and £5 per sq m tiles etc.

Yes attached to next door one side via its garage and the other side to a house. There is a decent garden and patio overlooking open fields though. I think they're calling it a mews otherwise would have to say terrace lol!

It has value for people that need it. So at the moment, H and I both working from home, we need additional office space, have priced it up and a decent spec garden office (secure, warm etc) would be about £20k. We may or may not go back into the office at some point but if I knew I was going to be working from home forever, I think it would definitely add value. It wouldn't add as much as having that space in the actual house (as long as it could be closed off etc).

That's what I wasn't sure about @Africa2go DH reckons he'd rather have it away from the house a little and in a block with others for some social aspect so he's keen but we're both unsure whether it worth the value they're asking when as you say, others would prefer it in the house.

I think that's because an office away from the house is less versatile than an office within the house (which could be repurposed as a playroom, snug, guest bedroom etc). Obviously I'm generalising but I think more buyers would pay for that additional square footage, whereas an external office is really only valuable if you want an office (or limited other uses e.g. gym maybe) and are happy for it to be away from the house.

This is true @Africa2go although FIL is coming for an extended visit soon so be nice to stick him in it! I've a feeling that wouldn't be allowed tho!

I personally wouldn't use such space at all. So ZERO. Unless it is an area where I could let it. Then I figure out cost vs benefit.

So is it house then out to patio, garden and then the office space at end of garden? If it’s that scenario I’d like that as DH has been working from home since March in my study in the house and it’s been disturbing. If he could leave the house the kids wouldn’t disturb him, he wouldn’t be yelling at them to get out and I wouldn’t have to listen to his phone calls. Then we could use it as a teen retreat later on when things are ‘normal’ perhaps.

If it’s in a separate area apart from the house then no

So an office in a block with all your neighbours? That seems like a bit of a niche development.

Two office spaces in the house would suit me better, failing that a private office space in my garden.

I'd maybe use my office in the block for storage though.

I think the more relevant question is how much less it would be worth than an equivalent house with the extra space internally. Answer: quite a lot. I think there is a real risk of overpaying.

Thinking round here, a 4th bedroom might cost roughly 40k and detachedness 30k. Maybe 10-15k for the office room. Very very approx guesses - obviously it's way more more complex than that, and will vary wildly by area.

there's a service charge of £80 a month for communal areas and sewage plant
Just imagine if that extra £80 a month was mortgage instead of service charge. You'd get much more house for the same money.

What is the tax implication of this separate office? I can imagine HMRC arguing that it wasn't part of your main dwelling and trying to charge Capital Gains Tax on it. And the Council charging business rates. Too complicated.

£495k for a 3 bed terrace sounds hugely expensive for the north west. I’m in NW Surrey, basically London, and you could get a nice though basic 3 bed terrace for that HERE. Seems very expensive to me, someone used to London/SW prices!

You say other properties would be overlooked, what’s to say there won’t be more development and the house you’re looking at won’t be overlooked in a few years? The space around the development is unlikely to be a lifetime guarantee. We have a home office and actually an office just away from the house would be well used by us, but I’m not sure would ever be the clincher in a property purchase. Agree that it’s not as versatile as a room in the house long term. I wonder if it’s a last minute development change to try and capitalise on the current wfh situation? I would buy a bigger house nearby if I were you.

Everyone I know who has a garden type office has only done so because they can’t extend their house internally. Internal much more versatile for changing needs. So very much a second choice option. For everyone who says it is great that they can get away from it all, I personally think it is much better to just be able to shut the door rather than tramp down the garden although I don’t have v young kids. Tbh, even when they were younger, they quickly realised they weren’t to come in when door closed.

So I guess my answer to your question would be that I would find this a massive negative to any house I was looking at and def wouldn’t consider paying more vs a property that had internal office space.

If the office space is part of the communal space, are there any restrictions on how it is used? And do you have any reassurance that this communal space will always be available to all residents? It would be frustrating to pay a premium for a space that you may not be able to use as you wish, or that might be withdrawn as the leaseholder/development owner may decide to redevelop it into more residential units or for commercial use.
To be honest, the service charge would put me off the most. There are plenty of examples of service charges being increased disproportionately.

£495k for a 3 bed terrace sounds hugely expensive for the north west. I’m in NW Surrey, basically London, and you could get a nice though basic 3 bed terrace for that HERE. Seems very expensive to me, someone used to London/SW prices!

The OP says its one of the priciest parts of the NW - in parts of the NW, there really isn't much of a difference between NW/South East prices (and I've lived in both).

Thanks so much everyone for the responses. I just wanted to get a feel for how people might feel given that I would want to sell it eventually and I can't afford to lose any capital. I guess you're paying for the super high spec interior fittings but then as pp have said, they will age. I guess it's like buying a 475k house and then spending 20k doing stuff to it, except your basically sticking that on a mortgage. No idea why they've done the office thing. I guess to jump on the wfh bandwagon as someone said. My DM mentioned business rates too and what you could use it for. I'm guessing not for a spare room so no flexible. Thanks again. We're getting so desperate to find something now. We've been really unlucky in the search so far. It's such a difficult time to buy.

I would hate it to be honest. I can’t imagine working with my neighbours and I suspect they’d want to be leasing it out. You’d also possibly have an issue leaving anything confidential there. I say this as someone who has just created an office space at home. I need the space but wouldn’t like it with neighbours.

I would 100% pick a detached over a new build terrace. The value just won’t be there long-term.

If I had all the space I needed in the house then this would seem like a bonus room, but being so separate and accessed via a public courtyard it wouldn't be able to replace anything in the house for me. I wouldn't want to pay much for it. Everyone I know who works from home either works in a spare room which also has personal items in it like home computer they want easy access to in the evenings or they work from a garden office and can leave it open while they nip back for a cuppa or the loo. Also they use those rooms for occasional guests.

The only people I can see this appealing to are people who run a business and they want to 'go to work' and then leave again at the end of the day.

Also not sure how insurance would work? Is it freehold? Could clients visit? It's a nice idea but I'd prefer the money go on another room in the house.

It sounds like a nice idea but it would be another thing to look after. It would be better to have another room inside the house. My ex had a garden room built as a man cave and it became a shed full of shite