Turbulent property prices, restricted housing supply, and rising moving costs have seen a surge of homeowners pausing their moving plans in favour of improving their homes.
Pepper Money analysed Google Search Trend data from April 2022 to April 2023 and found that the UK has seen a remarkable surge in interest in home improvement projects. In just one year, the search volume has grown by an impressive 59%, emphasising the increasing trend among UK residents to invest in enhancing their living spaces.
Cost-Effectiveness of home improvements
Recent data from the Finance & Leasing Association demonstrates a general upward trend in the total amount and number of home improvement loan agreements from January 2021 to February 2023. Home improvement loans have increased from £11m in January 2021 to £14m in February 2023. Simultaneously, the number of home improvement loan agreements has grown from 232 in January 2021 to 296 in February 2023.
Home improvement loans have become an increasingly popular option for UK homeowners looking to develop their properties and save money on buying and selling. According to Pepper Money, the average property value of people that were looking for loans was £309,548.51, while the average loan value was £40,618.86.
By taking advantage of home improvement loans, homeowners can not only save money but also create a more comfortable and functional home environment tailored to their needs and preferences. Investing in home improvements can lead to significant financial benefits in the long run, both in terms of increased property value and reduced costs associated with moving.
Property improvement trends in 2023
According to search demand, the most popular home improvements in 2023 in the UK are loft conversions, patio doors to a garden, and a walk-in wardrobe.
Looking at the average monthly UK search demand on Google we have ranked the top 10 most sought-after home improvement projects, considering average cost and added value to reveal what home improvements are worthwhile on your property in 2023.
Top 3 projects that add the most value
Loft conversions are a great method to increase a home's value and living space. According to research, a well-done loft conversion can increase a property's value by up to 20%. This is so that a property's overall square footage can be increased and made more appealing to potential purchasers or tenants by turning an underused attic space into a fully usable living area.
A beautifully designed garden may add a lot of value to a house. According to research, a well-planned garden can boost a property's value by up to 20%. A landscaped garden can considerably improve the property's overall aesthetic appeal and make it an inviting and lovely outdoor area for potential buyers or tenants to enjoy.
A new kitchen installation is another home improvement project that can significantly increase a property's value. In fact, it's been calculated that a new kitchen can boost a home's value by as much as 10%. This is because a well-designed and practical kitchen can be a huge selling point for potential buyers or renters.
Pros of investing in home improvements:
Cost-effective: Home improvements are often more affordable than moving to a new house, allowing homeowners to save on various expenses like stamp duty, legal fees, and estate agent commissions.
Customization: Homeowners can tailor their living spaces to suit their preferences and needs, creating an ideal environment without having to search for a new property.
Increased property value: Investing in home improvements can increase the value of the property, making it a more attractive option for potential buyers if the homeowner decides to sell in the future.
Cons of home improvements:
One of the most significant disadvantages of home improvement is the potential financial burden. Renovation projects can be expensive, and costs can quickly spiral out of control if not managed carefully. It's essential to create a detailed budget and contingency plan to avoid financial strain.
While home improvements are generally intended to increase the value of a property, some projects may not yield the desired return on investment. Over-improving a property, choosing unpopular design trends, or poor-quality workmanship can all lead to a decrease in home value.
The extent of the project will determine how much your daily life will be disrupted by house upgrades. This can include having limited access to particular rooms or utilities for a while or even having to depart the property temporarily.
Sarah Green, Retail Director at Pepper Money, comments:
“Home improvements can be a smart investment for homeowners in the current housing market. With careful planning, budgeting, and the right financing options, homeowners can transform their properties into more valuable, functional, and desirable living spaces. By doing so, they not only improve their quality of life but also contribute to a more sustainable and financially responsible approach to property ownership in the UK.”