There are many ways to add value to a property, but fundamentally it comes down to two key factors.
The first is very area and target market specific, whereas the second is much more literal and easy to understand.
So what is the quickest and easiest way to increase the desirability of your property?
Historically the best places to invest money in a property have been kitchens and bathrooms. These rooms can make a property stand out amongst the other properties on the market. However the caveat here is that in order to add the most value to the property, any kitchen or bathroom (or any other upgrade for that matter) should be of the highest quality APPROPRIATE for the property and location.
It wouldn’t make sense to spend £50,000 on a kitchen in a 1 bedroom flat on the outskirts of Doncaster. As a rough guide, spending 5% of the purchase price on the kitchen is a good starting point and 2.5% for the bathroom.
Another relatively easy and low cost way to add value to a property is by increasing the kerb appeal of the property. This can simply be a case of spending a weekend tidying up the outside of the property; mowing the lawn, painting fences, repairing gates, etc. It doesn’t have to cost money, but does give an instant initial (and parting) positive feeling on any prospective purchasers.
Increasing the size of a property is another fairly obvious way of adding value to a property. However again it must be appropriate for the area. If your property is in a row of 2 bed terrace properties and you turn yours into a 6 bed sprawling behemoth… it’s unlikely to be worthwhile.
It will require some research, but if you can establish the Price per Square Meter (or sq ft) for properties in the area, this is an excellent starting point.
You can do this by searching the online property portals for floorplans of similar properties to yours and properties slightly bigger. On most floorplans there will be a Gross Internal Area measurement. If you then divide the price of the property by this number it will give you a value per Square Meter or per Square Foot.
So let’s say there is a property that has one more bedroom than yours and is on the market at £250,000. You check the floorplan and find it is 1,800 sqft.
The calculation is simply 250000 / 1800.
This gives a Price per Square Foot of £139, or £1,495 per Square Meter. (Multiply by 10.764 for square meters).
As a very rough guide (and at this distance, all I can give are rough guides) the cost of an extension will range from £800 – £1200 per Square Meter. This will vary considerably depending on the quality of finish, area you are in, the property itself, the site, etc. So many variables!
However you can check with local builders in your area and ask them to provide you a quote on a Per Square Meter basis to get a more accurate and relevant figure for you.
As you’ve probably worked out, on the above example, for every say £1000 you spend on buying an extra Square Meter, you are adding an extra £1,495 to the value of the home. In areas of high property values therefore, extending can be the most sensible means of adding value to a property.
There are of course limits, so don’t expect to make your property ten times larger than everyone elses and still command the same Price per Square Meter!