Homeowners Increase Property Value by £6.5 Billion

New research has found that the extent of alterations and extensions that property owners have carried out over the past year have added around £6.5 billion on to the overall value of housing in this country. The data looks at work that has been done over the year to March 2015.

The report was compiled by Savills, an international real estate company. It shows that 220,000 people who own the property that they live in had work done to alter or extend it during the period. This could be anything from the installation of a wrought iron Juliet balcony through to a two-storey extension. On average, having this type of work carried out will increase the value of a property by 10%. If you base that on the current property prices in the UK, it would be the equivalent of £30,000 for each house.

Costs of Moving

At the same time as the rate of property extensions and alterations is increasing, the number of those moving to another property with a mortgage is still at a relatively low level. In the 12 months to the end of this March, 358,000 people with a mortgage moved home. This is only 50% of the figure that we saw 10 years ago and shows that homeowners are still fairly cautious about taking the next step on the property ladder.

There are a number of reasons for this, but the main one is due to the increased cost of moving house. This is causing more people to look at improving their current property rather than moving. They are carrying out work to make the property more suitable for their current living arrangements, such as creating an additional bedroom or bathroom or providing more outdoor space with a wrought iron Juliet balcony.

It can cost a significant amount to make a move up the property ladder, and buyers are still looking closely at the possibility of interest rates rising in the near future. They don't always want to take on the added responsibility of a larger mortgage. It can also be more difficult now to gain the right level of finance to purchase a larger home. Mortgage providers are looking more closely at affordability levels, which means homeowners might not be eligible for the size of mortgage that they require.

Increase in Property Prices

Home improvements are now seen as a more financially viable option than moving. With an increase in property prices across the country, if those who've had work carried out do come to sell their house, they will generally recoup the costs. According to data released by Rightmove in their July report, property prices rose for the second consecutive month. They grew by 0.1% across the country, which puts the average property price at a record level of £294,542.

If you are planning on having work carried out on your property, it's important that you research the company and choose a professional and experienced business. This will ensure that the work is completed to a high standard and lasts for a long time.