12 June 2018, 09:33

Revealed: The property improvements that give the best and worst returns

  • GoCompare Home Insurance has teamed-up with Henry Pryor, the BBC’s favourite property expert, to develop a Property Investment Calculator;
  • Most profitable home improvements include installing a new boiler or central heating, energy saving and home security;
  • Cost of updating flooring, bathrooms and kitchens may outweigh any added value;   
  • 26% of home renovations are undertaken to add value to a property but many homeowners could be making a loss by opting for the wrong projects.

A new calculator launched today shows the home improvements which add value to a property and those which could end up leaving you short changed.  The ‘Property Investment Calculator’, created by GoCompare Home Insurance, with the assistance of property expert Henry Pryor, gives homeowners an indication of average costs for renovations together with an estimate on the added value and potential profit from undertaking the work.   

The Property Investment Calculator, enables homeowners to calculate the potential profit from a range of home improvements by simply entering their property’s current value and renovation budget.  The calculator estimates the added value of undertaking different home improvements and by deducting the average costs of works, gives an indicative profit or loss.

Some of the most profitable projects for homeowners seeking to increase the value of their property include installing a new boiler or central heating system, making energy saving or home security improvements or creating off-street parking.  Redecorating, laying new flooring or updating a bathroom may slightly increase the value of a property however, the costs of doing so generally outweigh any potential profit.   

Renovation for a property worth £225,621*

Average cost

Estimated property value increase

Estimated profit or loss

New boiler

£1,995.00

£9,024.84 (4%)

£7,029.84

Installed central heating

£4,250.00

£9,024.84 (4%)

£4,774.84

A garden make-over

£1,500.00

£2,256.21 (1%)

£756.21

Knocked through rooms

£1,750.00

£4,512.42 (2%)

£2,762.42

Installing double glazing

£8,450.00

£9,024.84 (4%)

£574.84

Paint and decorate

£2,500.00

£2,256.21 (1%)

£-243.79

New flooring

£2,200.00

£0.00 (0%)

£-2,200.00

New bathroom

£4,250.00

£2,256.21 (1%)

£-1,993.79

Installing a new kitchen

£7,000.00

£4,512.42 (2%)

£-2,487.58

Installing solar panels

£5,000.00

£-4,512.42 (-2%)

£-9,512.42

Research** commissioned by GoCompare Home Insurance found that 26% of home improvements are undertaken specifically to add value to a property with popular renovations including: interior redecoration (53%), fitting a new kitchen (42%), replacing flooring (38%), installing a new bathroom (36%), a garden makeover (36%), installing new double glazing (29%), installing new central heating or boiler (28%).  Other works undertaken were: improving insulation (16%), knocking through rooms to create an open-plan space (16%), fitting solar panels (9%) and adding a conservatory (8%).  

Commenting on the launch of the ‘Property Investment Calculator’, Henry Pryor said, “Most people who are thinking of selling their home or looking to improve it to add value will consider the merits of a trip to the DIY store, some will even consider doing some building work in the hope of adding value but not all buyers will be prepared to pay for your idea of improvements or good taste.  Some buyers would even prefer to be able to put their own mark on a property and install the bathroom or kitchen of their choosing and may even pay for the chance to be able to do so.  It’s therefore essential that you think carefully why you are spending extra money and who will benefit.  My advice is usually spend money on the things that you want and leave other improvements to the next person who may not share your taste.

“Most buyers prefer to pay for the opportunity to be able to add an attic conversion, kitchen extension or convert a basement. Getting planning permission to do the work is frequently the best investment you can make leaving the actual choice of layout, decoration and equipment to the next owner.  Improving the green credentials of a house usually pays - a new boiler, insulation or energy saving measures along with security improvements will usually pay off but some additions like solar panels will be hard to get a payback on immediately.

Ben Wilson, GoCompare’s home insurance spokesman said, “Our new calculator gives homeowners an understanding of the typical costs and benefits of undertaking a range of projects, before they start the work, allowing them to see the potential financial benefits.

“Our calculator provides indicative valuations and estimates based on national data.  Therefore, depending on local housing market and labour conditions, the extent of the work undertaken, and materials used, figures for individual projects will differ and we always recommend people shop around to get quotes for work as well.”

Follow the link to GoCompare Home Insurance’s ‘Property Investment Calculator’ here:  https://www.gocompare.com/home-insurance/property-investment-calculator/

-Ends-

For further information please contact:

Anders Nilsson/Martyn John/Louisa Marsden at GoCompare on 01633 654 054 / 01633 654 725 / 01633 655132

Gordon, Jason or Liz at MAW Communications on 01603 505 845

Keep up-to-date with GoCompare on Twitter; @GoCompare

Notes to editors

*HM Land Registry UK Price Index January 2018; the average property in the UK is valued at £225,621.

**On the 19 March 2018, Bilendi conducted an online survey among 1,275 randomly selected British adults who are Maximiles UK panellists and homeowners.  26% (287 homeowners) have carried out home improvements in the last 5 years with the aim of adding value to their property.  The margin of error-which measures sampling variability-is +/- 2.2%. The results have been statistically weighted according to the most current education, age, gender and regional data to ensure samples representative of the entire adult population of United Kingdom. Discrepancies in or between totals are due to rounding.

About GoCompare

GoCompare is a comparison website that enables people to compare the costs and features of a wide variety of insurance policies, financial products and energy tariffs.

GoCompare does not charge people to use its services, and it does not accept advertising or sponsored listings, so all product comparisons are unbiased. Gocompare makes its money through fees paid by the providers of products that appear on its various comparison services when a customer buys through the site.

GoCompare does not sell its customers’ data.

When it launched in 2006, it was the first comparison site to focus on displaying policy details rather than just listing prices, with the aim of helping people to make better-informed decisions when buying their insurance. GoCompare has remained dedicated to helping people choose the most appropriate products rather than just the cheapest, and has teamed up with Defaqto, the independent financial researcher, to integrate additional policy information into a number of its insurance comparison services. This allows people to compare up to an extra 30 features of cover.

GoCompare is the only comparison website to be invited to join the British Insurance Brokers’ Association (BIBA) and is authorised and regulated by the Financial Conduct Authority (FCA).

For more information visit www.gocompare.com and www.gocomparegroup.com

Contact Information

Gordon Maw

gordon@mawcomms.co.uk