Zopa’s latest Home Improvement Index has revealed which renovations you should undertake to add value to your house.
The top home improvements that add value to your house
The research found that whilst the kitchen was the most popular home improvement, a loft conversion would give homeowners the best value for their money with a 70% return on investment. An extension, meanwhile, would yield the most profit. Decorating the home provided a healthy 62% return on investment and an additional 8% to the value of the property. In contrast, a garden makeover only offered homeowners a 14% return on investment and a £1,900 profit.
A quarter of British homeowners looking to improve their homes this summer are choosing to renovate their kitchen and seeing a 51% return on investment as a result. If this is something you're thinking about, check out our guides to budgeting for a kitchen renovation and planning your home improvement.
9% added to the value of a house
The research found that the average home improvement would increase the value of a home by 9% or nearly £24,000 (£23,837) – based on homeowner’s estimates. The average return on investment was 50%, based on the total amount spent by homeowners. The average profit across all improvement projects was £8,000.
Renovating for the long-term
Zopa’s research also found that two thirds of homeowners (65%) said that despite adding extra value to their property, they plan to stay there for five years or more. Just 12% of respondents said they would prefer to move rather than enjoy the benefits of their home improvements.
This suggests that homeowners are choosing to create their dream home rather than selling their homes and moving to a new property.
Zopa CEO, Jaidev Janardana, said: “Home improvements can be a cost-effective way for homeowners to add value to a property for the long-term. Taking out a personal loan instead of remortgaging or using an expensive credit card, could be a smart choice for homeowners who want to spread the cost of a home improvement project over a number of years through an affordable monthly repayment, and who prefer a quick and simple online application process.”
So far in 2017, Zopa customers have borrowed £92m to improve their homes, a 35% increase compared to the same time last year. Zopa has helped over 70,000 people to create their dream home.
Find out more about a Zopa home improvement loan.