With the cost of moving being so high, it can actually work out cheaper to improve your existing home instead, perhaps by having an extension. But this doesn’t come without risks. Get it right, and you should end up with a home that meets your requirements and has gone up in value. But get it wrong, and you could end up with spiraling costs and a home that’s worth less than when you started.
Here, we explore the pros and cons of improving rather than moving, and offer some helpful tips on making sure that you get it right.
The argument for improving your current home
If you like your home, your area and your neighbours, staying put and extending or changing the layout could prove a cost-effective alternative to changing properties altogether.
It's also a good option if you don't have much equity in your home, making moving difficult.
As long as you have the space, an extension can allow you to get the bigger house you need for a fraction of the cost. And putting a new kitchen or bathroom in can help to breathe new life into your tired, old home.
You just have to be prepared to put up with the inconvenience and disruption there will be while the work takes place.
Home improvement dos and don’ts
Even when altering a home to suit their needs, most people have an eye on a property’s end value when thinking about making home improvements. So it's important to make the right choices, both for your own comfort and to make it easier and more lucrative to sell your property should you want to do so in the future.
Easy and relatively cheap ways to increase space and bolster your home’s value include converting existing loft or cellar space. Putting in a new bathroom is also a tried and tested way to add value – without breaking the bank.
Common mistakes, on the other hand, include adding half-hearted conservatories that do not fit with the style of the property, and adding extra bedrooms without increasing the size of the communal areas to accommodate more people.
Whatever you decide to do, it's vital that you set out a budget and do your best to stick to it to avoid costs spiraling out of control.
How to fund your home improvements
Using your savings to fund home improvements will help you to avoid sliding into debt. But if you can’t afford to do this (it's important to still have some savings to fall back on), you could consider extending your mortgage or taking out a personal loan to fund home improvements. Fortunately, this doesn't have to be expensive – personal loan rates are at record low levels, hovering just under the 5% mark for those looking to borrow between £7,500 and £15,000.
Should I move instead?
If you don't have the space to extend or you simply want a fresh start, you may feel moving house is the best option. See our best family cities interactive tool for an insight into possible cities that may be of interest to you. But before deciding anything, find out whether your existing mortgage is 'portable' (if it's not about to come to an end) and whether you'll be able to borrow more from your existing lender should you need to and at what interest rate.
Be aware you may find it works out cheaper to remortgage to a deal with a different lender, but do check whether you'll have to pay a fee if you're getting out of your existing mortgage deal early. Mortgage rates are at historically low levels and it's now possible to get rates at less than 2% if you have a deposit of 35% to 40%, or the equivalent amount of equity in your home. This means that you might be able to borrow more without your overall monthly repayments going up too much.
However, bear in mind that mortgage fees are high – you could fork out as much as £2,500 – so it's important to factor this in when comparing deals. Compare mortgages with MoneySuperMarket.
Please note: Any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct