Do you want to maximise the value of your property investments but don’t know where to start? Chances are, you’re not alone. (And you’re also in luck, but we’ll get to that in a moment). If you’re tossing and turning over where to spend your money next, you might be thinking:
- “I want more rental income, but I can’t afford to add another property to my portfolio.”
- “I feel like my portfolio has hidden potential, but I don’t know how to unlock it.”
- “I want my existing portfolio to be worth more.”
Great news, the solution might be really close to home. Whether you’re a buy to let investor, trying to fix and flip or a British homeowner looking for a change:
Fix what you have.
New research by HSBC suggests that investing in your existing properties might be the best destination for your spare change.
It’s true, home renovations might cost you a lot of money, time and effort. But in most cases (and as we’ll come to see), it could really be worth it.
First, let’s tackle some of the hurdles.
Worried about the cash? Compare the cost of expanding your portfolio to fixing up existing stock. It’s likely that your wallet will prefer the second option. And that’s based on initial costs alone - not including the stamp duty charges you might face.
Also, remember that home renovations are investments. It’s unlikely that you’ll be throwing your money down the drain; it will visibly get to work. Your property’s resale value and rental cost could rise, which means you could get back more than what you put in.
Worried about the hassle? Some of these tricks can take a matter of days, and some might take a few months. Landlord duties can be a headache. But you can choose a renovation plan that’s tailored to your schedule. There’s no one-size-fits-all policy here. And not all home improvements require a bulldozer.
But you might want to be smart about it. You can optimise the act of home renovation. Working overtime isn’t the same as working smartly. If you really want to get the best value for money, you’ll need to ask, “Which home renovations add the most value?”
And that’s where you’re in luck. HSBC have made things really simple by conducting some fantastic research. The information you need to get started on reviving existing stock is right here, neatly packed together in a colourful infographic.
In a nutshell, HSBC’s research found the following:
- How much value could smart home technology add?
Smart tech, also known as PropTech, could add an average of £3,000-£10,000 to the price of your property
- How much value could a conservatory add?
It could increase the price of your property by 6-13%
- How much value could double glazing windows add?
A-rated windows could save £175 per year on a detached house, £105 per year on a mid-terrace house and £65 on a flat.
- How much value can a bathroom renovation add?
A bathroom renovation could increase your home’s value by 4-6%
- How much value can a loft conversion add?
Depending on the size, a loft conversion could increase your home’s value by 10-15%
- How much value can solar panels add?
Solar panels could add £2,000 to £5,000 to your property’s value
- How much value can an extension add?
An extension could increase the size and value of your home by 15-20%
- How much value can a roof renovation add?
A roof renovation could increase your property’s value by 60-70% of the cost
Get the whole picture:
Compare the cost of renovations to the value they can potentially add.
All data sourced from HSBC
Written by Jenna Kamal
Disclaimer and Legals
Property Moose does not provide any advice in relation to investments and you must rely on your own due diligence before investing. Please remember that property prices can go down as well as up and that all figures, rates and yields are projections only and should not be relied on. If in doubt, please seek the advice of a financial adviser. Your capital is at risk if you invest. This post has been approved as a financial promotion by Resolution Compliance Limited.
Property Moose is a trading name of Crowd Fin Limited which is an Appointed Representative of Resolution Compliance Limited which is authorised and regulated by the Financial Conduct Authority (no: 574048).
