At Cavendish Basements, we are captivated by the the housing market and all of its encompassing qualities. We like to delve into the latest trends and characteristics of the industry and reflect upon it to improve our services. In this article, we will explore whether investing in your basement will be beneficial to your property valuation.
The housing market in the UK is notorious for its concentration of people, averaging at approximately 650 people per square mile (IEA, 2017). This is exponentially higher than other countries in Western Europe. There are several problems that stem from this, living space and property value. But what could one do to minimise this?
Can one solve both of these issues, by investing in basement expansions? In the past basements were not necessarily a smart move for getting a return on investment. They would be considered a storage quarter or a room where nobody would spend their spare moments. However, developing characteristics of the UK’s property market seem to be transforming this norm with time.
Due to the notorious competitive nature of the housing market in the UK, developing your basement is becoming more common. Less housing sales are being reflected across the UK and by extension, less moving, which has given people the epiphany of utilising their living space more efficiently.
Increasing living space is a highly sought after characteristic in the UK’s housing market due to the compact population density, making it a smart investment for yourself or for selling the property. This is because you get to increase your quality of living, whilst giving yourself the ability to receive a monetary return on that investment if you plan on moving. According to Phil Spencer, “it costs £200 per sq foot to do the digging, and another £100 per sq foot to do the fitting out. So unless your house is worth £300 per sq ft, you won’t see your money back” (Telegraph, 2010) This is important to consider when planning on undertaking a basement conversion. However, if basement extensions are a viable option for your property, you can see an average ROI of 15% of your property value (Arlington Residential, 2015).
Investing in basement development can range from luxurious changes to more simple ones and both can be effective. Some property investors tend to create basements for more living space and utilise that characteristic to rent them out, which can also be profitable. It can come down to geographic preferences depending on your local area. Cavendish Basements specialise on Chelsea, Belgravia, Fulham and Battersea, which typically demand the more luxurious basement development projects.
Developing your basement with the intention of adding value to either yourself or your investment, would all be based on utilising the foundation that is already present. Therefore, getting the most out of this space needs to be done with a professional company, such as Cavendish Basements.
Developing your basement to its full potential would require someone with intrinsic knowledge of basement development. For example, bathroom development in your basement would be necessary if one would want to sell the property and get as much back on the investment as possible. On the other hand, if the basement is being developed for personal use, then obviously preferences will dictate the direction. Cavendish Basements take pride in developing your basement with your vision in mind to get the most out of your property. When selling a property, the return on investment for the development of a basement is difficult to predict, however, given the London property market you are very likely to make a significant return. The likelihood of this occurring truly comes down to the quality of the company responsible.
It is also important to utilise the ‘balance of space’ to its maximum potential. This means that implementing certain features will influence the type of environment your basement will possess and using that space effectively is important. With the increasingly fast pace that technology is being introduced to homes, allows for a plethora of options for one to take. Sonos and Alexa are just some of the examples that would make you see a return on your investment whether selling it or not. They do not take up a great deal of space but add so much value and that is important to consider when developing your basement or property.
The types of basement development also influence the return on investment. For example, there are walk out basements, partial drop and non-walkout basements. Each one has their own pros and cons and really depend on the foundation that a property has to work with.
Developing your basement is a win-win situation, where you can improve your living conditions by creating more space for you to spend your leisure time. This means that you get a return on your investment in both your quality of life, or if you plan on selling your property, receiving monetary compensation for the value increase. In some cases, it is important to know the intentions behind developing a basement as well, as the more personalised it gets, the more difficult it is to sell (but not always). Cavendish Basements can develop properties with either direction in mind and can increase the property value of your house.
Thomas Schutte – Marketing Team at Cavendish Basements