May 22, 2019 | 06:06 AM

Property & Home

20.08.2018Extensions: Are they worth it for boosting property value?

This article will explore home extensions and consider whether or not they're worth it in the grand scheme of home sales.

When it comes to placing a property on the market, there are lots of things to think about. From getting a solicitor to finding a new place, there are plenty of decisions to make. But arguably the most important choices for potential movers begin much earlier in the process. Boosting the value of a home starts years in advance of a sale, especially if a time and cash-intensive investment like a home extension is chosen. This article will explore home extensions and consider whether or not they’re worth it in the grand scheme of home sales.

What is a home extension?

Everyone knows that a home extension constitutes the creation of extra space, of course. But it’s surprising just how many home alterations can be considered extensions for the purposes of adding value. In some cases, no new buildings have to be erected at all. Properties with a garage, for example, have a ready-made home extension destination right there, while converting all or part of an attic into an extra bedroom can transform a property’s value. Attic conversions also act in the same way as extensions, and in essence it’s just extending upwards rather than outwards.

Facts and figures

On the face of it, extending a home is a no-brainer. In the majority of cases, it adds value to a property and it can also speed up the sale process, too. One study found that a loft conversion alone could add 12.5% to the selling price, while a conservatory could add 6.7% in some cases. For these reasons alone, it’s well worth considering.

By making smart moves during the extension building process, a homeowner can increase the chances that the extension will last and won’t sap further cash down the line. Using reputable builders is one such move, while getting all relevant planning and other permissions in place is another. On the whole, an extension should be regarded as a fruitful endeavor – provided, of course, that the cash to fund it and the space to accommodate it are both available.

The potential drawbacks

The main drawback – and primary reason why people avoid home extensions – is usually the cost. It can drain a budget pretty quickly. In fact, an Australian home extension taking up 80 square meters can set a homeowner back somewhere between around $160,000 and $310,000. Because of this, homes with extensions are not that common. Consequently, this means they’re in high demand, which in turn boosts the chances that the extending homeowner will make their cash back, and more, at sale. There’s no guarantee of this, though, and if a market downturn occurs then all the money could go to waste.

But there are other drawbacks, too. Most standard Australian family homes are relatively spacious, but they don’t sit on unlimited grounds or dozens of acres-worth of space. Building a conservatory, for example, will still often take up garden space, and a small garden could pull the future sale price in the downward direction instead. The trick is to look for potential extension space which doesn’t cause more trouble. Double-storey homes with integrated garages often have empty space above, for example, and these can in many cases be turned into a large extra bedroom without depriving roominess elsewhere.

The value of a home depends on many factors, but it’s definitely the case that it can be improved substantially by building a house extension. There’s a lot to think about before laying the foundations for a swanky new conservatory or a luxurious extra bedroom, though. The costs involved can be eye-watering, and as with any investment there’s no guarantee of making back the money. And with some extensions taking up too much room in the garden or other space, the whole thing could backfire and end up harming a property’s value even further. Being savvy about extension locations is also essential.

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