Should I move house or improve my property?
As your home becomes more lived in, you may notice areas that require improvement. Sometimes it is a hard to decide whether the time and money home renovations cost is worth the while. Some people might prefer to move house instead of putting forth the time, energy and money that come along with home renovations. It really comes down to weighing out the costs and determining if it is more financially sound for you to find a new home or improve upon the one you already have. We will help break down the process of both sides of the decision, hopefully making it easier for you to make a plan of action when it comes to either selling or renovating your home. Sometimes it may be easier to just move house, but taking the extra time to plan and execute home improvements may be the wiser financial option. It is important to understand which home improvements can add value to a property, and when home improvements may cost more than moving house.
Should I make home improvements?
Deciding to make home improvements can be a big decision. Much should be taken into account when considering if making home improvements is worth the while, and whether they can ultimately add value to your home. Renovations can take time and be quite inconvenient, but can also make you money in the long run. There are plenty of reasons why you may choose to renovate your home as opposed to moving to a property in better shape.
• You may not want to go through the mortgage process again. The mortgage process can be time consuming. In fact, sometimes certain renovations can cost you less time compared to the amount of time finding a new home and getting a new mortgage may take.
• You may want to expand your home to provide more space for your family, especially if it is growing.
• You may want to make your home more energy efficient. This can help cut down on monthly utility bills.
• You may want to make your home more modern, and thus, more attractive to buyers if you ever plan to sell.
• Renovations may be more cost effective than moving house. You will need to consider the costs of a removal service, furnishing a new home and costs associated with getting a mortgage.
• Improvements can add value to your home if done correctly.
• To fulfil your needs. For example, you may decide to renovate to make your home more functional or liveable.
What home improvements could I make to increase value?
The value you can add to your home depends very much on which home renovations you make. Some renovations, for example, may be useful or pleasing to you, but ultimately do not add any value in the long run.
Some renovations that you can make to simply brighten up your home, but don’t add much in terms of value include:
• Repainting the walls
• Fixing doors
• Adding new cabinet fixtures
• Clearing limescale from bathrooms and the kitchen
• Installing new taps
• Replacing outdated lighting fictures
• Replacing tiles, cabinet and surfaces
These renovations will generally improve upon the feel of a home, but may not do much when it comes to adding value. However, there are some home improvements you can make that do add value to your home.
These renovations include:
• A loft or garage renovation - Adding extra space for storage can add value.
• Extension of existing property - Perhaps you have some extra space in a garden?
• Expanding living areas to be open plan
• Kitchen renovation or modernisation
• Adding an en-suite onto an existing bedroom
• Replacing doors and window fixtures
• Replacing flooring throughout the home - Updated flooring can add between 1-10% value to a home.
• Double glazing of windows
• Updating heating systems to be more energy efficient
• Renovating the garden to improve landscaping.
Certain renovations can add significant value to your home. Some of the most common renovations that are worth making if you have the time and money include:
• Bi-folding doors can add value of around £5,000.
• A garage conversion can add around £4,850 on average.
• Renovated and restored period features can add upwards of £4,700.
• Extension of the main house can add £4,000 or more, depending on the size of the extension.
• Under-floor heating can add nearly £4,000 in value.
• A stair or chair lift can add £2,000 pounds or more in value.
*Actual added values are just an estimate and actual added value can differ between properties.
Determining which renovations are needed, which can add value to your home in the long run and which are not really necessary can help you better make the decision of whether renovating your home is a good idea. It is important to understand that not all improvements add value to your home, especially if you are renovating just for the sake of selling for a higher price than you paid for the property.
Relocate or renovate?
Even though renovating can add value to your home, it is vital to consider if the added value is worth it in the end. You can only do so much in terms of renovations, and what you fix-up may not necessarily add value to your property. You should take into account how the costs of renovation add up compared to the costs of purchasing a new home.
Things to think about when buying instead of renovating:
• How long will the buying of a new home take?
Buying a new home can take anywhere from several weeks to several months. Home renovations can take just as long. It is important to evaluate which is more time consuming, and if you even have the time for either.
• Will buying a new home be cheaper than renovating?
If a home is in a bad state of disrepair, it may be worth moving. However, you should take into account the fact that moving can be time consuming and costly. If your home is in bad shape, can you even get back the costs you spent on the home purchase in the first place? If not, fixing up a few things may make your home seem more liveable.
You can use our house price value checker to see what your home may be worth now. This may give you a good idea of whether it is worth the costs and time to renovate.
• How long will the renovation take versus the time spent searching for and mortgaging a new property?
If time is an issue, you may need to evaluate what is more important: adding value to your home and making a living space you are happy with, or selling and starting over.
• Do I want a different location, or am I happy with where I am?
Often times location is key. If you are in an area you love, you need to consider if moving to a new area is worth your while for an upgraded home, or if the area you are in is worth making some home improvements. It really depends on where you want to live. If there is a home on the market in a desirable area, moving may be a good choice. On the other hand, if you are happy with where you are, it may be worth staying in your current home and making some slight improvements to appease your tastes and also add value to your home.
Our house price value checker can help you determine if homes in a different area are worth more or less than your current home, and if moving house is a good idea for you at the time.
What to consider when renovating
Time is a big factor when it comes to renovating. Depending on which renovations you plan to make, time can be of the essence. For example, if your renovation timeline is constricted by say, a new child on the way, you may need to re-evaluate if renovating is the best idea right now.
Renovations can also be costly. You should evaluate if the costs of a renovation product are worth your while. Of course, it depends whether you are renovating to add value, or renovating for your own pleasure. Either way, costs of renovating should be considered.
• Necessary repairs
Sometimes there are necessary repairs that need to be made. These can include fixing cracks, damp-proofing and appliance repairs or upgrades. These are repairs that need minding to, and often times can affect the value of your home.
Costs of home typical home renovations
Home extension — £26,000 - £34,000
Loft conversion — £ 45,0000
New bathroom — £6,000
New kitchen — £10,000
Double glazing of windows — £400-600 per window
Costs of typical home repairs
Damp-proofing and repair — Up to £16,000
New boiler — £2,700
New roof — £4,500 - £12,000
Rot removal and fixing — £1,000-£2,000
How can I fund home renovations?
If you have savings to contribute to home renovations, then it is probably best to use these to fund them. Although you will be taking away from your nest egg, you will not be adding extra costs in terms of interest or loans, and ultimately will likely be adding more value to your home.
• Credit cards
Credit cards are one way you can fund home improvements. However, keep in mind the interest rates and try to pay more than the monthly payment in order to make using a credit card to fund home improvements a sound financial move.
• Personal loan
You can always take out an unsecured personal loan to fund home improvements. If you plan to do so, it is important to be aware of interest rates. With a good credit score, you are likely to find competitive rates on a personal loan. Although, if the interest rates on a new loan are more expensive than the rates on a mortgage for another home, then renovating may not be the best bet.
• Taking out a second mortgage
You can always take out a second mortgage on your home if home repairs and renovations are badly needed. This is not advised for smaller repairs and renovations that are not necessary, as it increases your debt to credit ratio and may make getting financing more difficult in the future because of this.
Remortgaging your home to release equity and use those funds for home repairs and renovations is one way to go about improving the value of your home.
You can use our remortgage comparison tool to see what rates you can get on a remortgage for your home.
• Green Homes Grant
With the Green Homes Grant scheme, homeowners can receive vouchers worth up to £5,000 to pay for energy-efficient home repairs and improvements. Heat pumps, solar thermal systems, insulation for floors, walls, and roofs, and double or triple glazing are all covered by the Green Homes Grant. If any of these areas of your home could use updating, it is worth looking into whether or not you qualify for the grant.
What should I consider when moving house?
If you come to the decision that staying in your current home and making repairs or renovations is not for you, then you will need to consider the costs involved with moving house.
First, you will need to think about your mortgage. You will need to decide if you want to port your mortgage to another property, or sell your home outright and then go about mortgaging another home. Porting your mortgage involves transferring your existing mortgage to a new home. If the new home is more expensive, you may have to take out a second mortgage to cover the costs.
You could always remortgage as well, especially if you are near the end of your original deal. You can use our remortgage comparison service to get an idea of what your rates would be on a remortgage in this case.
The bottom line
When deciding whether to relocate or renovate, the decision really comes down to how much you like your current home and if renovating is worth the time and hassle as opposed to moving house. Only you can make the decision in the long run, but by evaluating the costs outlined in this article you should be able to get a good idea of whether renovating brings added value to your home and if the costs to do so make it a smart decision financially. Likewise, you should evaluate what moving house will cost and decide which is the best financial decision for you.
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