Are renovations the doorway to profit?

Are renovations the doorway to profit?
Our study shows that homeowners believe by investing in décor and bigger renovation works they are adding value to their homes for future years

The latest research from Co-op Insurance has revealed that 91% of homeowners think their house value has increased since they bought it - by an average of £33,125.

The study which questioned 1,000 UK homeowners has found that 31% of homeowners bought their property with their eye firmly on how much money they could make from their investment. Of these, a reliance on house prices increasing generally was the main way (62%) homeowners were hoping this would happen.

Location was also a key deciding factor with over a third (34%) buying in an already desirable area whilst 32% of people did their research and sought out properties in areas classed as ‘up and coming’. Whilst 29% bought a home in clear need of renovation.

Changing rooms is a common theme, with 76% of homeowners in the UK making changes to their property since they moved in.

Of these, 60% believe the renovation works they’ve completed has led to an increase in value. On average, the renovation and decorative work that homeowners have invested in came to £18,224. This means that, on average, homeowners are seeing a £14,900 profit as a result of these works.

Homeowners in London have seen the biggest average rise in profit thanks to renovation and decorative works with 94% believing their property has increased in value by £21,499. However in Northern Ireland, despite 78% of people thinking their value has increased, it doesn’t look to be down to décor or renovation work, with an average loss of £205 being recorded when you compare spend on renovations versus potential value increases.

Kitchen is king when it comes to the rooms homeowners should renovate if they are looking to entice new buyers, with 56% believing it is this room that really sells a home. For a quarter of buyers, the living room is the second most desirable selling feature of a home. Bathrooms, whilst third on the list when it comes to saleability, are only important to 4% of homebuyers according to the research.

Over three quarters (76%) of homeowners have made changes to their homes since they bought them with décor being the most popular choice to spruce up a new pad (73%), followed by, the often more expensive, refitting kitchens (67%) and bathrooms (65%).


Caroline Hunter, Head of Home Insurance at Co-op, said: “Our study shows that homeowners believe by investing in décor and bigger renovation works they are adding value to their homes for future years.

Kitchens have long been lauded as the heart of the home and our study continues to solidify this, with over half of homeowners believing that this is the room of the house that could make, or break, a sale.

Whilst they are a big draw for prospective buyers, they can be expensive, therefore it’s important to revisit your home insurance policy to ensure you have the right level of cover in place during the building works, to protect you from additional risks during the work. Don’t assume your builder will have insurance in place that covers you in every eventuality.”

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Latest Comments

MBM Homelets
MBM Homelets 23 Mar 2017

Although this is a very positive step, there is little or no guarantee of the standard of workmanship employed by the tenants. We have had experience of a professionally decorated property being ' painted'...

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ajay
ajay 21 Mar 2017

How is the "robust evidence" looking now?

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NathanG
NathanG 20 Mar 2017

I've been watching the series so far and am completely baffled by the cases that were presented. Though, I don't think that we can protect ourselves from every scam possible - it will just make the scammers...

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Landlady14
Landlady14 01 Mar 2017

You would think so Niraj Shah! My experience only proves that there are varying qualitiers of professional in all aspects of property letting. None of the ones I have dealt with, from letting agents to...

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Mark
Mark 01 Mar 2017

Thanks for this article. Hopefully one day everybody's lifestyle will be eco-sustainable.

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Ben Taylor
Ben Taylor 28 Feb 2017

I was convinced that London was the most expensive!

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Alan Read
Alan Read 28 Feb 2017

Australia are leading the way in this I think. The trouble with Britain is we don't get enough sun to make use of solar power.

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James Powell
James Powell 27 Feb 2017

This is a very good news.

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DanHumphreys
DanHumphreys 27 Feb 2017

It sounds like a good idea. Anything to help the younger generation get a foothold.

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Matt
Matt 20 Feb 2017

Is this fake news?

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Matthew Hollywood
Matthew Hollywood 07 Feb 2017

Matthew Hollywood - Director Mishon Mackay Land & New Homes - Brighton The shortage of New Homes is in part effected by the lack of land sales. Land sales are held back because there is a disparity between...

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CommercialTrust
CommercialTrust 30 Jan 2017

Hi Graham, Would be interesting to see the above figure calculated against an investment via a Lt Company /SPV structure and if the investor found themselves pushed in to the higher tax bracket. Mortgage...

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