Improving the energy efficiency of a home was also found to add extra value, particularly ahead of proposed Government net zero regulations.
Andrew Harvey, senior economist at Nationwide, said: “The pandemic period was characterised by a ‘race for space’ as people re-examined their housing needs, although more recently there have been signs that some of these patterns may have unwound, at least partially.
“Considering this, we’ve taken the opportunity to look at the factors that affect the value of homes, and the potential to add value.
“Location remains key to house values, but other factors, such as the size of the property (including number of bedrooms), are also important to homebuyers.
“Home improvements that increase floor area, such as an extension or loft conversion, remain a compelling way to add value. Indeed, since we last looked at this back in 2016, the value added by such improvements appears to have increased.
“Ultimately of course, the decision to invest in the home is an individual one, taking into account the costs and hassle involved, as well as potential benefits.
“And, for some households, it’s a choice between move or improve. Amongst owner-occupiers considering moving, the most cited reason was for a larger house or flat.”
He continued: “Having more useable space is generally thought to be consistent with better quality accommodation and people appear to be prepared to pay for it.
“A 10% increase in floor space, other things equal, adds 5% to the price of a typical house. Adding space to create an additional double bedroom can add around 14% to the value of an existing two-bedroom house.
“A second bathroom remains a favourite amongst homeowners and our research shows that an additional bathroom can add 6% to the value of the average house.”
Harvey concluded: “Aside from extending, other ways of making your home more attractive include making it more energy efficient.
“Given cost of living pressures, energy costs remain a concern for households.
“Further, decarbonising and adapting the UK housing stock is critical if the UK is to meet its 2050 emissions targets, especially given the housing stock accounts for 20% of the UK’s total carbon emissions.”
If you've just completed improvments and you're curious about the new value of your home, we would love to help with a free, no-obligation market valuation.
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