DIY danger: Home improvements fail to have the same 'Sarah Beeny effect' on house prices
By Andrew Oxlade - www.thisismoney.co.uk
Homeowners are being warned that big DIY projects are failing to add as much value to homes as a year ago - and may even lose money.
While a loft conversion or new kitchen and bathroom may still boost the price of a house, the gains are now far less impressive, according to the HSBC annual Home Improvement Survey.
It found that a loft conversion would now only boost a property price, on average, by £16,152, significantly less than the £20,876 that agents estimated a year ago.
The weaker effect could be down to moribund state of the property market but it may also reflect the fact so many people are extending their homes - unable to climb the property ladder with tightened mortgage rules - that an extra room in the loft is less of a distinguishing factor on a home for sale.
HOW PROJECTS CAN BOOST YOUR HOUSE PRICE
How much home improvements can typically add to the value of a property and the percentage change since 2011. The cost of the work is not factored in:
Loft conversion, £16,152, -23%;
Room extension, £15,665, -3%;
Conservatory, £9,420, +14%;
New kitchen, £4,577, -19%;
New windows, £4,866, -8%;
New bathroom, £2,955, -11%;
Re-decorate house, £3,100, -4%;
Re-surface run up/drive, £2,679, -7%;
Re-carpet house, £1,738, minus 19%.
Loft conversion remains the project that could add the most value.
But with prices for building materials rising fast agents warn it may not be worth tackling some projects - at least if financial gain is the aim.
According to Econoloft, one of the largest loft conversion specialists in the UK, the typical cost of conversion varies from £20,000 to £30,000 depending on location, although this can be dramatically cut for those willing to do the work themselves.
The estimated gain of £16,000 could therefore leave homeowners nursing a loss.
'Whilst sensibly improved and well presented homes will generally be attractive to potential purchasers, rising labour and material costs mean that the gap between the cost of improving and monies realised at the point of any sale have been reduced,' said valuation expert Paul Cutbill, of Countrywide Surveying Services.
Britain became a nation obsessed with home improvement in the property boom years, spawning TV success for the likes of developer Sarah Beeny on Channel 4's Property Ladder.
But the benefits are now in question. According to the HSBC study, the only major home improvement work which adds more value than last year is a new conservatory. The work will typically increase property values by £9,420, a 14 per cent increase since 2011.
Peter Dockar, head of mortgages at HSBC, said: 'Homeowners should think carefully about the type and extent of any home improvement works they are planning. Those which enhance quality of life while retaining broad appeal should be favoured over more individually-styled alterations.'
A room extension will add £15,665, a 3 per cent fall on a year ago, while a new kitchen will boost the value of a home by £4,577, a decrease of nearly a fifth (19 per cent) on last year. Re-carpeting a home will add £1,738 to a property's value, which is also a 19 per cent drop on last year.
The study, based on interviews with 112 estate agents, also found strong regional variations, estimating that a new kitchen will add £9,125 to the value of a home in London but less than half the amount (£4,300) in North East England and £2,333 in Scotland.