A home extension can seem like a lovely middle ground between moving house and a full renovation. It’s more then a renovation because you’re adding square footage and new rooms to your household, but it’s less than a home move because, well, you’re not moving.
An extension will require an intensive budget, however, one that you carefully consider and pre-portion in advance. Contractor fees, materials, the general inconvenience this can add to your daily schedule, it will all need to be considered.
Of course, it’s unlikely you’re expecting to extend your home for free and without any planning. But it’s also true that you may need something of a final push before pulling the trigger. So, when might you financially justify that home extension? When do you decide that now is the moment, and the time has come?
Well, there could be some quite specific variables that go into your decision. It may be you want to extend the property while your partner is off work for the summer holidays thanks to their job as a teacher. But as we can’t account for very unique specifics, we can certainly discuss the financial aspect as a main focus.
Consider our advice, below:
You Have The Chance To Buy Extended Land Cheap
Sometimes, an opportunity presents itself that feels almost too good to pass up, as perhaps your neighbor is selling a slice of their garden that borders your property, or there’s a small adjacent plot available at a cheaper rate than usual thanks to a farmer selling up. Land is often valuable and if you have first dibs and a good price, well, that can be a great reason to extend the property.
Land values tend to appreciate over time as well, especially in desirable areas where space comes at a premium. That’s why the rich buy so much of it. The economics might suddenly make much more sense when the land acquisition cost is significantly reduced.
You could look at it this way, even if you aren’t quite ready to build immediately, securing the land while it’s available cheaply could be a smart long-term investment. The potential for future development adds value to your property regardless of when you actually build. Many homeowners regret not taking advantage of such opportunities when they had the chance, and it might just tip you over the edge to put your extension plans in motion.
It might be worth consulting with a real estate professional to understand just how much value this additional land could add to your property, both with and without an extension built upon it.
Extensions Can Serve As A Maintenance Opportunity, Too
Building an extension is a perfect chance to address some of those maintenance issues that might otherwise be postponed, as contractors are already on site, you can buy more materials for a discount, and your home is already experiencing disruption. Perhaps if you knock through a wall to create two additional stories, you can redo the room in kind. So you’re essentially bundling the renovation with the fixes, and both work out cheaper that way.
For instance, while extending your kitchen, you might consider upgrading outdated plumbing or electrical circuits throughout that section of your home. Alternatively, you could replace aging windows not just in the new space but in connecting rooms too, potentially improving energy efficiency across a larger area. As we mentioned above, sometimes when you’re not going to have a better opportunity to make savings, it’s good to finally adopt those plans you were after.
When House Valuations Are Rising
During periods when property values are climbing steadily, extensions can deliver particularly strong returns on investment for obvious reasons. It’s like investing more money in a stock that’s been steadily rising, only much less risky, because unless 2008 decide to repeat, the chance of your home valuation cratering is unlikely (touch wood).
It’s also worth noting that construction costs tend to rise alongside property values. That’s because materials become more expensive, and contractor rates increase with demand, so getting your extension underway before these costs climb further could save you thousands. You may find that contractor mortgages allow you to justify an extension more readily, especially if your employment history is a little different than usual and doesn’t help you gain the loan you’re after.
Before Zoning Limitations Come Into Effect
You might have heard rumors about potential changes to local zoning or housing authority laws that could affect your ability to extend your home in the future. These changes could involve restrictions on building height, footprint size, or even your closeness to other property boundaries. Once they’re done, even if they’re just in a discussion state now, these limitations could limit your options or make certain types of extensions impossible.
Property owners who stay informed about potential changes can sometimes take action before such new limitations are enacted. This proactive approach might allow you to proceed with expansion plans that wouldn’t be approved under future regulations, and if you’ve built it all legally in advance, they can’t exactly demand you tear it down. This may never happen to you of course, but it might, and if so, it could inspire an extension investment. Though, the project may need to be completed in months as opposed to years.
If Neighbors Are Working On Similar Projects & Can Share Resources
If you notice several neighbors planning extensions or major renovations, this could create an unexpected opportunity for collaboration and cost savings through economies of scale as we mentioned above.
Contractors often offer better rates when they can schedule multiple projects in the same area, because they save on travel time, equipment transportation, and administrative costs when managing several nearby jobs. In the same way, bulk ordering of materials for multiple projects can result in significant discounts if you work with neighbors you trust. It’s a touch more complex to plan this but might save you a good deal.
With this advice, we hope you can justify that extension you’ve been considering and benefit as a result.