Taylor Scott International News
Home owners in the UK have added an estimated £6.5 billion to the value of the country’s housing stock in the 12 months to March 2015, according to new research. Some 220,000 owner occupiers in the UK extended or altered their home in past year, equivalent to one in 74 home owners, the report from international real estate adviser Savills also shows. Based on the assumption that the average extension or alteration adds 10% to the value of the average home, this would create an average uplift of £30,000 per property, the report points out. By contrast mortgaged home movers are still only at half the level they were 10 years ago pre credit crunch, at 358,400 in the year to the end of March 2015, according to data from the Council of Mortgage Lenders (CML). ‘The cost of taking the next step up the housing ladder and the difficulties in acquiring the mortgage finance to do so appear to have encouraged a significant proportion of owner occupiers to extend or alter their existing home,’ said Lucian Cook, head of Savills UK residential research. ‘Changes made by the mortgage market review and increased stamp duty for properties over £1 million are both likely catalysts to home improvements, impeding the rate and volume of transactions in the market,’ he added. The report also suggest that there is a far greater propensity to alter or extend in high value markets. Savills estimates one in 44 home owners did so in London the year to end March 2015, while £3.6 billion of the £6.5 billion was added to the value of housing stock of London and the South East. ‘High value markets have generally been the strongest performers post credit crunch. Extending has therefore been both more financially viable, with owners recouping the money spent on home improvements through house price growth and more attractive given the relative costs of upsizing,’ said Cook. The research also shows that Hammersmith and Fulham and Kensington and Chelsea top the list of local authorities with the highest propensity to extend, both creating an uplift in property values of over £100 million before fixtures and fittings are taken into account. Beyond London, areas such as St Albans, Cambridge, Winsor and Maidenhead and Guildford have all seen significant numbers of home owners extending their home. Continue reading →
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