Does extending pay back?

[Extendornot]

We are living in a house that's too small for our family but great location for schools and work. I'd like to move when we can. But for now, an extension would work for us.

However, given we are likely to move within 5 years, I'd hope that the extension might be an investment as well as a nicer place to live.

We can extend in to the attic, redo an old conservatory, go to the side (downstairs extension, or potentially 2 storey) or convert the garage in the garden to something nice.

What pays off? What have you found from your experiences? Did your extension pay back?
.....Or if you want to invest in your property for a better sale price are you better to do painting, new kitchen etc.

The year of the extension might make a difference as I believe cost of labour has increased. So please do share a rough timescale, it's still interesting eitherway

We're in the South East, extended 8 years ago. At the time, I asked an estate agent to value the house with and without the plan and they said we'd make about what it cost. With builder's costs so high right now and volatile property market, personally I would only extend if you need to, not as an investment.

It all depends on local conditions. You need to see how much it would cost Vs how much you could sell for afterwards. Include the cost of borrowing and temporary rental if needed.

I think it would break even for us right now. But the cost of moving, especially stamp duty, tips on favour of extending our house.

With building costs still high, and interest rates making the debt more expensive, plus a possible reduction in house values, moving might be better value in the next year or so.

As a guide previously you could expect to break even or profit a little. With the increased costs of labour and materials- plus falling prices its unlikely you would profit.

I spent over 100 grand on a house that I anticipated would be forever home. I thought I’d be leaving feet first in a box.

Everything was done re-plastering, new central heating, new boiler, new kitchen, new bathroom extension. We never got a Penny back.

I look at property as a home and anything I do to It is literally for my benefit only whilst I live there.

Do you remember the Sarah Beeny shows back in the early 2000s where the long and the short of it was people stressed themselves out spent a fortune on the credit cards in the long and the short of it is the market rose and they would’ve made whatever they made on the house if they had not touched it.

I do believe those days are back. And it’s not a bad thing.

I took advice from this from a couple of estate agents not long ago and basically the gist was that to increase the value you need to increase the number of bedrooms.

Say for example you have a 3 bedroom house you could extend the kitchen/ dining room to make more living space and this would put you at the top of the bracket for 3 bedroom houses in your area but it wouldn't push you into the 4 bedroom bracket really unless there were exceptional circumstances. Of course there's other factors for doing this but if you are just looking at value it wouldn't be the best decision.

He recommended going into the loft to create extra bedrooms as this would push into the next price bracket although he did day once you get into 4 bedroom plus territory you need other factors such as off road parking etc to get into the top price for local 4 bed properties.

If you extend, to make the house bigger for your family, would you want to move anyway? If yes, then I wouldn't bother.

If no, you might stay, then I'd definitely do a loft conversion, to give you extra bedroom(s) and another bathroom, before you consider the other options.

SE. We did a big extension last year. It has increased the value of the house by approx the cost of the build, however we intend to live here for the next 20 years so it's not really relevant

If doing the work means you're likely to stay in the house longer term then it's worth doing the work as long as you don't greatly overspend.

If you're doing the work with a view of adding value to your house in the next few years it's probably not worth doing.

We made made back the cost of extension plus 1/3 of the cost. I wouldn't do it unless you need the extra space as its very hard work. However it was our only option to move up to much bigger house. Now we can buy that size easily.

Most of the houses round here which are sticking on the market have been ‘over extended’. They have too many bedrooms for the living space, or ‘grand design type’ , (hard to maintain and heat ) ground floor extensions which are also an imbalance for the bedrooms. They tend not to flow , and often one room has been sacrificed or become a sort of corridor to enable access to the extension.

A garage is useful even if you don’t put your car in it ( lawn mower, suitcase, tools etc) So is a loft. A loft bedroom where you can only stand upright in four foot down the middle is not that appealing . Building all over your garden means you have no outside space for, you know , a garden to play and sit and grow things in.

We did loft conversion 15 years ago, house stayed as 4 bedroom as we turned box room into en-suite. Made no money when we sold that we wouldn’t have made from increase in market. It was easier to sell though.

New house finished a big extension and renovated just after covid, so pre covid prices…about £200k on house that cost £485 .we won’t make it back, but the market has moved on by £75k. We plan to be here at least 10 year and house works for us.

in your position I’d get some estate agent advice, look at what has happened with similar, but don’t expect to make money on it.

Thank you so much. It's great to hear of others experiences.

I get the perspective that a property is a place to live and not an investment. I get the principle. But realistically, we wouldn't choose to stay if not for the location at this time in our lives. Property is so expensive that we don't want to sink money in to it and it mean our next house isn't as nice because we can't afford as much. We bought only a few years ago so it's going to cost us a lot in income to buy a nice home, so we have to be smart with what we do. I don't want to make loads of money but we are already way behind people who bought more than a decade ago on what is affordable.

Hope that explains it for those who think a property shouldn't be an investment. It's not really but being smart will help us out

In my experience adding bedrooms, yes. Downstairs extension, absolutely not.

A friend once told me that to make your house more attractive than others, just before going to market, pay to get plans and approvals for an extension and loft conversion, get permission and put that on the advert but don't do the work.

Shrug. I guess that makes it slightly more appealing to people who can't afford that extra bed bracket.

This was before building costs got out of control though.

I think at best you would break even. Also massive hassle of doing the work and risk of things going wrong.

We have done a loft conversion. I believe that will have increased the value as we added bedrooms.

We now plan to extend the downstairs but I reckon this will potentially not increase the value as much. At best we might break even. We reckon it will cost around 100k which brings the house price up the value of equivalent houses in the area but with falling house prices at the moment, I would be surprised if the value goes up much. But, this is our home for the next very long time. I don't see us moving to anywhere else.

How disruptive did you find the loft conversion if you don’t mind me asking @Notyetthere ?

@33BSHKATS it wasn't too bad. We started in September when our oldest would be at school for most of the core noisy/messy hours. Builders would finish at 3-4pm. My husband would do the school run with the baby whilst i cleaned as much as possible before they came home. We are in a semi detached bungalow so most of the messy initial loft building stage, they accessed from outside. The mess starts when they break through for the stairs. But even then, our Carpenter used to board up the hole when access wasn't needed and kept most of the mess up there. The worst for me was the plastering. We could isolate the rooms upstairs for plastering but it wasn't as easy to isolate the downstairs as the stairwell was double height so it was open to the rest of the downstairs. But it was short-lived, and we coped ok.

You just have to accept that it will be dusty for a while. We always ensured to clean areas we would need for the evening. I was on maternity leave at the time so I was mostly available to answer any queries. We also invested in an air purifier which run a lot after the plastering as that was really dusty. Where baby and dd slept was kept permanently shut.

We are about to start a renovation / extension (house hasn’t been touched since the 70s). We got an estate agent out to value it for works we are doing and I think if we’d done the extension ‘on the cheap’ or knew someone who could do mates rates / we do a lot ourselves … we could break even.

but we are doing a full overhaul of everything.

We are going to spend more than the house is worth. But we want to stay in the village we are in and there just aren’t many the size we need. We are planning to stay here until the kids have grown up, left home and it feels too much for us. That said, I do feel like we are being heart led, rather than head led!

I feel like it’s cheaper to move than extend nowadays.

@sheeplikessleep we are also doing this in a village, there is nothing like what we want around for sale. The property was initially cheaper as we bought it a while ago and have been paying it off for a while so will most likely break even ish or close. But the win is having the place at all. Barely any decent family homes and the new builds are tiny in comparison and not in as nice a location

I am pretty sure our loft conversion has added value.
If I did everything I wanted to do downstairs, given current costs, I think I'd recoup about 30%. I'd be doing it for our home not an investment.
I will have reached the ceiling price as not so desirable area I live in.

I think your best case is break even. If you want to move fairly soon anyway I wouldn't bother.

We also broke even. We extended our 3 bed 1930s semi 5 years ago because the box room was an issue. We are still 3 bed but the old box is now a bathroom, a new double bedroom has been added, the downstairs has a lovely kitchen/ diner and the old bathroom is a shower room/ corridor. It was intense and expensive but we can live here until the children are grown up.

Before Covid maybe but things have doubled since .
We had a expression in 2019 and it cost £60k.. a friend had the same one and it cost him well over £120k .. it also depends on what you do ,, don't convert a garage etc as you lose what you gain in value

We had quotes for an extension last year and spoke to an EA. But as we plan on moving with 5 years he said not to bother. We wouldn't make the money back in that time.
And now house prices are apparently falling so I wouldn't bother unless you planned on staying put 10 plus years!