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How to add value to your home

Your home's value can fluctuate according to the market, but you can also increase its value by taking a few steps. Whether you simply want to have more equity or you hope to one day sell your property for a higher price, adding value to your home could be a worthwhile investment.

A dream kitchen like the one pictured could be one way to add value to your home.

You can add value to your home by making some home improvements, but in terms of what you spend and what you get back, you may not always get a great return on investment.

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How value is added to a home

If you are still paying off your mortgage, the more you have paid back, the more equity you will have in your home.

This is essentially like having additional value in your home, but this can still be negatively affected by market factors, such as house prices generally falling. Prices can rise too if demand increases, and therefore, the more you have paid (and the more equity you have), the more value there will be in your home.

If you are simply looking for extra value so you can sell your property in future, or if you are looking to release equity in your home to remortgage to buy another home, then adding value can help with that.

You can potentially add value to your home irrespective of market forces by making home improvements. This can be a slight risk as the amount you spend on, say, refurbishing your kitchen or converting your loft, might not always increase or even add the same value back on to your property.

How you can improve your home

There are a few types of home improvements you can make that could potentially add value to your home:

  • Add an extension to the property

  • Loft conversion

  • Build a conservatory

  • Refurbish the kitchen

  • Install a new or additional bathroom

When considering the type of home improvement you want, it's worth looking at what estate agents value most when trying to sell a property. Many estate agents advertise the number of bedrooms, bathrooms and property size before anything else. Of course, if you shoehorn a bedroom into an existing closet space, then you may not really be adding much value.

Property outside of London typically costs £900-£2000 per square metre, and around £5,000-£10,000 per square metre inside London.

So, if you want to increase the square metres of your property, consider how much value it could potentially add versus the cost.

Adding an extension to the property: You can easily add value to your home by increasing the square metres of the property. Although, even for a modest extension, you are likely to have to pay anywhere between £10,000 and £40,000. It will likely also take up much of your time to ensure the work is carried out efficiently and safely. A badly built extension could reduce the value of your home, so it's important to get trusted and reliable builders. You will also need planning permission and a survey before the work begins.

Loft conversion

A loft conversion could potentially add an extra bedroom and bathroom to your property. Some homeowners find they have no need for their loft, while others use it as storage space. Either way, the extra liveable space could add thousands to a property's value. A loft conversion could cost between £15,000 and £50,000. You don't always require planning permission but it's worth checking first.


A conservatory is a relatively quick and simple way of adding additional square metres to your home. You rarely need planning permission and they can be built within a week or two. They usually cost upwards of £10,000 depending on what level of luxury you want.

Refurbish the kitchen

There is no guarantee that a new modern kitchen installation is going to add value to your home, but it could be the additional selling point that attracts more buyers and bumps up the price. The design and feel of a kitchen might also come down to personal taste, and not all buyers are going to agree with the way you've done it. A new kitchen could cost you around £10,000, give or take, depending on how many appliances and units you are replacing, and the quality of each one.

Install a new or additional bathroom

If you are refurbishing your bathroom, you might not have any guarantees that you will add value to your home, although retrofitting appliances to be more eco-friendly could save you money on your water bills. If you convert some unused space to create an additional bathroom in your home, then that would likely increase the value of your property.

Is it worth remortgaging to improve your home?

If you have plenty of equity in your home, then you might be able to get a good remortgage deal to get you additional money to improve your home. You could see it as investment to further increase the value of your home, but you would still need a plan in place to help pay it back.

If you don't have a lot of equity in your home, i.e. you have not paid back much of your mortgage yet, then you should certainly avoid remortgaging. If you are in the early stages of your mortgage repayments, then you should only consider remortgaging to switch to a better deal, and not to release more money.

When you remortgage you will likely have to pay penalty fees for paying off your existing mortgage early, so weigh up all of the costs first.

What could devalue your home?

There are many factors that could potentially devalue your home, including:

  • Housing market cooling — prices falling across the board

  • Local issues, such as bad schools, high crime or noise pollution

  • Risk of flood

  • Home improvements gone wrong

  • Degradation of the building or appliances not in keeping with modern standards

There are other factors too, such as having single glazed windows or poor insulation in your home. If a large number of buyers are likely to be put off by something about your property, then there's a good chance that will devalue your home.

When and how should you get your home valued?

There are many websites that can help give an estimated valuation range based on your postcode and some information about your home, but for a more accurate result you can pay for a professional to view your home.

Estate agents will be able to give you an estimation of what they think they could sell it for. It's best to get your home valued when you are ready to sell, and ideally after you have made any home improvements.

What is equity and why does it matter when remortgaging?

Equity is the amount of mortgage you have paid versus what's left to pay. If your home's value has increased, then your equity will also be higher. For example, if you have a £150,000 on a home you bought for £200,000, then your equity is worth £50,000 — but it's easier to understand as a percentage, which is 25%. This is because the price of your home could increase or decrease in value and thus change the value of the equity, but your portion as a percentage will be the same.

The more equity you have, the more remortgaging power you have. You will have access to a wider range of deals and find it easier to borrow more money. Equity when it comes to remortgaging is your borrowing power. The less of it you have, the less you will be able to borrow.

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