Move or Improve
- Nearly 6 out of 10 (59%) homeowners snub moving up the housing ladder in favour of making home improvements
- Nearly a third (31%) cite housing inflation as their main reason for not moving house
- Over one in ten see stamp duty as prohibitively high and a third (31%) would be more likely to move if duty was significantly lower
Six out of ten homeowners are set to snub a move up the housing ladder in favour of making improvements to their home. A survey of over 2,500 UK homeowners from comparethemarket.com found that, at a time of economic uncertainty following the Brexit vote and when house prices are still hitting record highs, a clear majority of homeowners plan to remain in their current properties and undertake improvements, indicating a possible slowdown in housing demand in the coming months.
The research shows that a key factor in the lack of movement is high house prices, with almost a third (31%) citing recent housing inflation as the cause of their decision not to move. Many also see stamp duty as a major hurdle: one in ten view the high cost of stamp duty as preventing them from moving home and nearly a third (31%) admitted they would be more likely to move house if there was a significant cut in stamp duty.
With the average cost of stamp duty standing at over £3,500 across the UK – not to mention other moving costs such as legal fees, estate agent fees and removals – many homeowners are opting to use that money to add a new kitchen, bedroom or living room to their existing home which could further increase the value of the property when they do decide to sell.
Investing in an extra bedroom adds nearly 9% in value to your property, or on average £18,971, and could add significantly more depending on which area of the country you live and the quality of materials used. Those who have built up enough savings could therefore consider investing in home improvements instead of spending the money on stamp duty costs. Even small changes such as adding wooden flooring can enhance the value of your existing property over and above the average cost of stamp duty (£3,500) if you were to move.
In London, where comparethemarket.com has calculated that the average cost of stamp duty stands at over £16,700, the equivalent sum spent on refurbishments can have an even greater impact on the value of a home.