Should we move or extend

MoveorNot

Hi All, 

Seeking some advice. We bought our home pretty much exactly 2 years ago. It is a property in our preferred , and great, area. It requires a lot of work, including 2 storey extension (approx 3 metres) and full renovation (very old house that hasn't been touched or updated for years). Essentially we picked the area and road over the house, knowing it would be a project in future. 

We bought the house for £1.3m

However, now we are finding that renovation costs are very very high, and that we could move to an area not too far where we can get a house for same price as we bought this, which would not require extension or renovation. This would also be closer to work and schools. 

Question is, do we stay and extend , renovate or do we bite the bullet and start looking to move. Are we better off to sell and buy something of similar value which doesnt require work, still in a nice area, but incur the cost of moving and stamp duty vs renovating current house. 

I think we could sell current house for 1.35 - 1.4 m (so not much more) and buy a new home for similar. 

Appreciate any input. Tia 

EssexHebridean

Is the value to you of creating somewhere that is designed specifically for your family's needs and wants worth the amount of upheaval that the works would create? If yes, then stick. If no, then twist. 

Also possibly for consideration - what would be the value of the current property once the work is done, and how much would the works cost? 

You presumably bought the house because you loved it in spite of it not being your perfect layout or whatever - what has now changed? is it as simply as you're not sure that you want the hassle of extensive works being done while you also live there? we changed tack on a property purchase last ear because we suddenly realised that we REALLY didn't want to be living in a property with major works going on again. Worked out well for us as we found pretty much our perfect house within our new increased budget soon after. 

MoveorNot

Thank you for your comment and questions. 

Yes, the upheaval and cost in reality just seems too much. Also have young kids, so we would have to rent somewhere during duration. I guess we accept that we made an error in judgement potentially.

However, to your important question, and this is my partners rationale for this house - if we extended and did the work, then it would add a LOT of value. This is a road where all the houses are different, they vary from £500 k up to £3m , so no ceiling price really, and in general the area is expensive and houses sell quickly.

But in reality I don't know when we will save this much to do all the work, and maybe paying stamp duty will work out better if we can just 'move in' and live somewhere. 

I am pleased it worked out for you

propertyhunter

Do you roughly know how much the renovation will cost you? Generally, you can estimate £3000 per sqm of new floor space in London, with a good quality of finish, fittings and fixtures. The potential gain is value would be significant given ceiling prices. However, some builders can charge more. 

If it doesn't make financial sense, and you are happy to live in a less desirable road (as I assume that is what the compromise would be given the price differential), then go for it. If the reasons why you bought this house no longer stand, then move.

The bad decision wasn't necessarily buying this house, but staying in it when you don't want to probably is.

Remember the upside of renovations - a house that is made for you, by you. 

Could you live with parents to make renovating easier? I know this isn't ideal for anyone. 

MoveorNot

Thank you @propertyhunter. We *think* it would cost around £150k, but that was a very high level estimate. We would extend by about 400 sq meter in total. 

We are aware the gain would be a lot if we were to do it and move at some point ( or we probably wouldn’t move as we bought this house for the area and how nice it is here for our toddlers - for now and when they grow up). We would be able to leave them a house worth a lot and with a lot of gain in the future , or use the money to help them if we sold and downsized in the future. 

The area we’d move to is also desireable, but wouldn’t get a road like this with close proximity station yet being in a village etc. 

we could move in with parents , it’s just been tough in the past for many reasons beyond this thread and my partner would prefer to spend money and rent. But hopefully I can convince to do it for half the duration - in the hope that things don’t go wrong (I’ve heard a lot of horror renovation stories from friends lately - time and money lost whjch also worries me ) 

thank you for reading !

MoveorNot

400 square feet , not meter ! 

Slinky

I think £150K sounds optimistic. We had a 4x5m single storey extension built 2 years ago, and some fairly extensive refurbishing in a small 4 bed and it was nearer £200K.

FreeBear

Slinky said:

I think £150K sounds optimistic. We had a 4x5m single storey extension built 2 years ago, and some fairly extensive refurbishing in a small 4 bed and it was nearer £200K.

I would concur. 400ft² is 37m², and a £150K budget gives a costing of £4k per m². In the current market, that would probably get you a bare shell, maybe completed to second fix stage. Realistically, I'd double the budget to cover for any unforeseen problems and hope it is enough to do the decorating & add the finishing touches.

propertyhunter

I would just get an architect to draw up some plans, then get the builders to quote you, and add 20% to that price. I'm having 77 sqm added and budgeting 400k, but that also includes renovating the entire house (3 bed detached). I know it's possible because I've had three builders say so - but finding someone to trust is another thing entirely. 

MoveorNot

Thanks All! Yes, getting a quote seems like a good idea. 

I guess stamp duty + moving costs would still be cheaper than a full renovation it seems

MysteryMe

If you work with an architect you could find you can save money by repurposing existing space / going into the loft etc.