Renovate to accumulate - which renovations boost property values most?
Could you add value to your buy-to-let property with a lick of paint or an extra bathroom? What converting a garage or loft space into an extra bedroom?
At a time when every penny counts for landlords, renovation works might not be high on the agenda. But increasing the value of your property could command a higher monthly rent - or help you sell-on your asset at a better price. What’s more, you don’t necessarily have to spend a lot to get a good return…
New research from Towergate Insurance analyses a range of renovation projects to find out which will boost the value of a property - without breaking the bank.
Using the current average house price of £220,700 (taken from the latest Office for National Statistics/Land Registry index), the research shows the least expensive renovation project is the transformation of a space into open plan living - costing around £2,100 - which could add a whopping £12k to the value of a property.
The most expensive project is a single storey extension, which would cost £20,000, but would only really add around £2k value to a £220,700 property.
Meanwhile one of the biggest returns on investment was found to be on garage conversions, with an outlay of £15,462 resulting in an increase of value of more than £40k - a 20% estimated value increase.
A loft conversion, would be slightly more expensive - in the region of £17,000, (more if you install dormer windows) but could result in an extra bedroom - adding £30k to the value of the property.
Installing decking would only result in an estimated 2% value increase (for an initial outlay of £2.175) , and new hard flooring 3% (costing around £4,000).
Head of Operations at Simple Landlords Insurance is Alex Huntley. She says: “Clearly, landlords would be better off installing carpets than hard flooring - and cleaning or replacing it between tenants. Keeping your garden neat but simple is also going to make your life easier, and things like decking can require a lot of maintenance.
“The good news is that something as easy to achieve as painting and decorating, costing under £3k, could add £7k worth of value. So it goes to show that little touches can go a long way.
“For larger projects, just watch out that changes on your home don’t incur extra insurance costs. The more bathrooms you add, the more pipes you have to leak - and your premium could go up as a result. Always run your numbers first. You don’t want that extra bedroom to tip you over into a higher insurance bracket, and negate any potential rental profit