How Can I Save Money On An Extension?

Initial thoughts on saving money would be not to build an extension (or loft conversion) in the first place. However, if you are in a situation where an extension project will add value to your house (and hopefully more than the project's cost), then crazy as it sounds, borrowing money and doing an extension project could actually save money!

So assuming you have decided to go ahead with a project, there are lots of things you can consider doing to save money but always keep in mind that taking short cuts might not save money in the long run.

Why Build an Extension?

Most of us move because we want more space - a larger kitchen, an extra bedroom, or a dining room to host large parties. But when you consider all of the moving costs, from surveyor and agent fees to stamp duty and conveyancing, jumping into a new home goes from fantasy to stressful inconvenience.

Building a professional extension is an affordable option for adding more space without uprooting your life and family. Even better, an extension can dramatically increase the value of your property, provided it's done well. A local estate agent will be able to tell you whether your extension will add value, which in turn helps you set your budget.

One Storey or Two?

How much space do you need? There are many things to consider before embarking on an extension, but one of the most important is the amount of space you require. If you're about to welcome a new family member into your home, you'll probably want to consider another bedroom and maybe even an extra bathroom.

Building vertically is one of the best ways to add space without going over budget. At the same time, you would assume that building more rooms means more money out of your pocket. The most expensive elements of an extension are the roofing and foundation. Therefore, by building up, you can gain more space with only a marginal price increase.

Choosing the Right Size Extension for Your Budget

Before you start planning your extension, work out whether the cost of building it and fitting it out is equal to – or hopefully less than – the amount it might add to your home's asking price. You can do this by talking to an experienced local estate agent. Looking for dual occupancy? Look no further! Home Builders has you covered. 

As a general rule, the more square footage you add, the more your home's value should increase (but beware of ceiling prices in your area – it could mean that an extension does not make economic sense). However, the bigger the extension, the more it will cost.

By contrast, more minor extensions with less square footage might give you extra space but don't tend to be very cost-effective. 

Getting the balance right by building an extension that's just a proportionate size for a price you can afford is a vital part of pre-planning.

If you are planning a single-storey extension, consider opting for a two-storey extension instead of reducing your costs per square metre.

Is an Extension Cheaper Than a Conversion?

When thinking about a budget extension, the first thing to ask yourself is if an extension is as cost-effective as repurposing existing space that's underused. 

A seldom-used garage or loft space, for example, could be cheaper to convert and give you valuable extra living or utility space for a fraction of the cost of building an extension. 

But there will be many cases where converting existing space is unfeasible and the only option, if you wish to remain at your existing home, is to extend.

How Much Does An Extension Cost?

The cost of an extension can vary considerably according to the following factors:

  • Extension type (e.g. due to plumbing and electrical work, bathrooms are considerably more expensive than bedrooms)
  • Extension size (e.g. extensions get cheaper per sq/m as the size increases)
  • Quality of soil (the soil and lay of the land affects the foundations)
  • Property's location (e.g. transport of materials to remote areas may increase price)
  • Materials (e.g. high-end materials will increase the price)
  • Build process (e.g. DIY and self-management can reduce labour and material costs by 30%)

While many variables affect an extension's price, you can determine an approximate price by requesting an estimation, or even better, asking for a quotation from both labourers and suppliers. Whether given verbally or in writing, an estimate is only a guess, meaning the final bill may well exceed the original price. A quote, on the other hand, is a definite and legally binding price. It should clearly display a list of all works to be done, a breakdown of the costs, and include VAT charges.

Money-Saving Tips

If the recent announcement of the Government's home renovation grant has got you ready to add an extension to your home, you may be wondering where to start or if you can extend your house on a budget. While the home renovation grant is a great wallet boost, it's important to be total across the entire cost of a major renovation like an extension.

Single Storey vs Second Storey Extension Cost

If you're considering a second storey extension, you may be expecting a bigger bill than that for a single-storey extension. In most cases, a ground floor extension can cost more! Raising a home and building underneath doesn't normally require foundations or a costly concrete slab like a ground floor extension. A ground floor extension could also require additional excavation work to level out sloping land.

Living On-Site Whilst Renovating

Despite second storey extension costs possibly saving you money during the build, you could find yourself losing money elsewhere - like in living expenses. It's slightly harder to remain living in your home during the early stages of a second storey renovation when you might be missing stairs to your front door! While it will depend on how your floor plan is being modified, in most cases, it's easier to remain living in the home during a single-storey extension.

Beware of Bespoke Fittings Costs

The idea of large doorways and custom sized windows is appealing: until you get the bill. If your budget can afford bespoke fittings, then go for it - otherwise, cut costs by sticking with standard-sized doors and windows for a cheaper approach to home renovation. At Home Builders, we offer a wide range of duplex build.

Measure Twice, Cut Once to Reduce Costs

Home renovation builders are usually pretty flexible and can modify certain aspects like PowerPoint switches, floor levels, and even plumbing locations. However, last-minute changes could come with an extra cost. To save some cash, make sure you're happy with your design before the build begins. That means planning out every little detail like PowerPoint locations, light switch locations, and floor coverings. If you're unsure of where to start, Hille's building designers can work with you to ensure your needs and tastes are captured.

Don't Forget About Those Little Extras

Rubbish removal, permits, approvals - on their own, these items don't cost much, but they quickly add up. Don't forget that a home extension cost is not just about the designer, the builder, and the materials - it's also about ensuring the worksite is clean and safe and is operating according to all local and state regulations.

Use simple building materials 

Similarly, the simpler the building materials and interior fittings are, and the easier they are to install, the more affordable the project will be. Consider the position of fittings inside the new extension too. If, for example, a new toilet can be sited near an existing soil stack rather than at a distance from it, you'll save on labour and material costs.

Plan in standard fittings

To keep costs down, you may need to rule out non-standard, made-to-order doors and windows. This will almost certainly mean you opt for cast concrete sub-floors and concrete blockwork for walls or choose rooflights over dormer windows - in doing so, and you will reduce your costs considerably.

Don't be lured by fashionable brands

Remember, more affordable own-brands or DIY-store products can often do the job just as well as premium brands. Dulux paint, for example, will do as good a job, if not better than expensive, trendy paints that cost twice the price, while DIY-store Metro-style tiles are indistinguishable from those of boutique brands once they're on the wall.

Keep the groundworks simple

Simplifying the groundworks will help reduce costs, too. This might mean opting to site your extension away from trees, drains, sewers or other buried services – assuming, that is, you have the space to be choosy. Plus, remember to factor in the costs of building foundations and getting them right first off.

Avoid these DIY pitfalls

Before you take on any DIY project, ask yourself these important questions…

Are there any health and safety risks for you?

It goes without saying, but you should never undertake a project that could put you or others in danger. If the work you're considering is very manual and intensive, it might be worth checking with your doctor, should you have a history of joint or back injuries.

Will you need any specialist equipment?

For instance, we don't recommend doing your groundworks here because you'll need to hire a small digger. However, many projects we have recommend will still require a skip, so factor this into your costs.

How much would it cost to fix should things go wrong?

While you might hope for the best, you should be prepared for the worst happening. Fixing a bad pipe is one thing, but if you take on your brick-laying, fixing this in the future is going to be very expensive and intrusive to your home.

How long will DIY take in comparison?

Though DIY is often a lot cheaper, it does tend to take a lot longer. Partly because you might not be as efficient as a professional and because many people have full-time jobs and can only work in their homes in the evenings and weekends. If you're able to live in your home while the work occurs, this might not be too much of a problem. However, if you need to rent temporary accommodation during the build, you might lose all your monthly rental bill savings.

Will this hurt my investment?

While many people take on extensions for extra space, there's no denying that extensions are also investments. What you put into the project now, you'll hopefully see returned when it comes to selling your home. Because of this financial element, you'll want to make sure your house price doesn't suffer because of poor handy work. This is why we caution against building the actual extension yourself. It's bricks and mortar where most of the value lies, so unless you can guarantee professional quality work, leave this to a trusted contractor.

Ways To Finance An ExtensionRemortgagee your home

Are mortgage is when you transfer your mortgage from one provider to another. It's usually done to raise cash funds by committing to a longer repayment plan when switching to the new mortgage. One benefit of our mortgage is the opportunity to raise funds fairly quickly.

It's worth considering that your mortgage is effectively a big loan that your home itself is used as security for. And so increasing the amount you're borrowing can be fraught with danger – if you can't make your repayments, then you risk your home being repossessed by the provider. For this reason, it's important to make sure you're aware of all the costs involved in your extension before taking the plunge! For more information and top tips, head to our mortgages and financing advice pages. 

Use savings

If you have savings to use, then the obvious benefit of taking this option is that you won't need to borrow any extra money to complete your extension. However, interest rates are not very competitive for savers at present, and it's worth assessing whether you want to outlay such a large amount of your own cash in one go. Think carefully about how long it will take you to save up again (or if you need to), and weigh this against any interest you may be paying if you borrow the money. Everyone's circumstances are different, so it really is a personal choice. Most importantly – don't forget that some of the better savings account deals could have restrictions on you getting access to large amounts of cash.

Pay on a credit card 

It's easy to see the appeal of putting a comparatively small or medium-sized house extension finance on the plastic. If you do decide to take this route, be sure you're on a deal with a 0% introductory rate if you're taking out a new credit card to pay for the works, or you may end up paying a lot of interest on the job.

One benefit of using a credit card is that you'll get some protection thanks to Section 75 of the Consumer Credit Act. This can be a life-saver if there are problems during the project – for example if a contractor who has agreed to do your extension fails to deliver the service they said they would.

Like with are mortgagee, it's important to think carefully about whether you can feasibly afford to make the repayment plan. And be sure to look out for any hidden fees or charges with this type of spending. Remember that with credit cards, some purchase and cash advance interest rates can be eye-wateringly high. Check out our range of dual occupancy builder for your dream house.

Explore your options for a second mortgage 

Also known as a secured charge loan, a second mortgage is when you keep your current deal the same and find another provider who'll give you a second deal. Under this arrangement, you would have to make repayments on both mortgages at the same time. Once again, this option should be thought through with care as you'd be increasing the amount of borrowing that's secured against your home, quite possibly at a rate that's higher than your current mortgage.

One of the appeals of second mortgages is that interest rates can be lower than, say, rates on credit cards or personal loans because your property effectively backs the loan, reducing the provider's risk.

Take out an unsecured loan

If you don't like the idea of borrowing more against your property, you could apply for a bank loan or another type of unsecured loan.

While secured loans use collateral (such as a house or car) to protect the lender, an unsecured loan is judged largely by a borrower's past history of managing credit well. For example, a home improvement loan is a type of unsecured loan. If you fall into this category, then this type of loan might be best for your circumstances.

You might find a decent loan with a fixed interest rate and a repayment term of up to about five years. The interest rate you get will depend on your credit score, which is a three-digit figure used by lenders to determine if you're a high or low risk when it comes to borrowing. Your interest rate will also depend on the loan term and the amount borrowed.

Home extensions can be great, worthwhile investments that increase your home's value and give you that extra bit of space to improve your quality of life. Whether you choose to dip into your savings or go down one of the above borrowing routes, with some careful planning and research, you could soon be on your way to your dream home.


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