How to work out the rebuild cost of your home
Your home’s rebuilt cost is different to its market value – here’s why it’s important to get the right figure for your home insurance quote
Looking for home insurance?
When it comes to home insurance, correctly working out the rebuild cost of your property will help ensure you buy the right amount of cover. But how do you come up with a figure?Our guide is here to help.
What’s the rebuild cost of my home?
Is the rebuild cost different from the market value of my home?
Yes. The market value relates to how much someone might pay to purchase your property.
The market value is likely to be significantly higher than the rebuild cost because it also takes into account factors such as the value of the land the property sits on and the desirability of the location.
Why do I need to know how much it would cost to rebuild my home?
You need an estimated cost for rebuilding your home so that you know how much buildings insurance to take out. Home insurance providers will use the rebuild cost you submit to price up cover.
If you have a mortgage, your provider may also insist you have buildings insurance in place as a condition of the loan.
What happens if I underestimate the rebuild value of my home?
If you underestimate the cost, there could be a shortfall if your home needs rebuilding.
While you might think this unlikely, fires in particular damage thousands of homes every year causing structural damage.
What happens if I overestimate the rebuild value of my home?
If you overvalue the amount, you’ll be over-insured and pay too much in premiums.
What factors might affect the rebuild cost of my home?
If your home is made of specialist materials, such as thatch or even timber and concrete, it could be more expensive to rebuild than a typical bricks and mortar home.
The type of property is also important. If you live in a block of flats, the rebuild may affect the entire building, making it more difficult to estimate how much cover is required.
How do I know if my home is listed?
To find out if your home is listed, consult English Heritage, Historic Scotland, Cadw or the Northern Ireland Environment Agency.
How do I calculate the rebuild cost?
You can use the rebuild cost calculator provided by The Building Cost Information Service (BCIS) of the Royal Institution of Chartered Surveyors (RICS).
Before you use the calculator, you’ll need to work out your home’s external floor area for both upstairs and downstairs.
The calculator only focuses on brick properties, so if you want to be accurate, a professional surveyor will be able to calculate the rebuild cost.
A basic survey should cost around £250, and you can find a local surveyor through RICS.
You can read more about calculating the cost of your home insurance policy here.
How to work out your square metres?
It’s a straightforward sum. Measure the length and width of the ground floor walls and multiply the two figures together. If the upstairs is identical to the downstairs, simply double the ground floor area.
Be as accurate as possible, but don’t worry about being 100% on the mark. The important thing is that you have insurance in place.
Also, don’t forget to include any additional square meterage such as converted loft space.
What if I live in a flat or maisonette?
Given flats and maisonettes are constructed differently to houses, a surveyor may be required for an accurate valuation.
If you live in a leasehold property, first check that the freeholder (building owner) has buildings insurance in place.
Many flats and apartments in the UK are leasehold properties, with the cost of the insurance often passed on to the leaseholder through a service charge.
Will my rebuild cost change if I renovate my house?
If you add an extension, conservatory or loft conversion to your home, the rebuild cost is likely to increase.
If this is the case, recalculate your rebuild cost and tell your insurance provider so they can update your premiums.
If you aren’t changing the fundamental structure of your home it’s unlikely the rebuild cost will change.
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