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Will a granny flat boost my home’s value?
There’s something very attractive about the thought of having an annex – often known as a ‘granny flat’ – built on your property. It could be somewhere you reserve for visiting relatives; a place to work; or even a haven you can escape to when the rest of your family are driving you mad. But while it sounds like a nice idea, is it actually worth building one?
Popular home extension idea
The Daily Mail reported last year that the number of UK homes to have a separate annex for relatives has increased by over a third in just two years, according to figures from the Valuation Office Agency. One thing that might be fuelling this surge in popularity is the council tax discount introduced in 2014 for homes where a non-dependent relative lives in an annex alongside the main household.
And it’s a pretty attractive discount too – 50%! So if you’ve been thinking of asking a relative to move in, you could find your generosity saves you money.
Not just for grannies
The popular image of a granny flat is – as the name suggests – a couple of rooms where granny and/or grandad can enjoy some time away from the rest of the family. And if you have older relatives who need extra care, or who simply wish to be more involved in family life, this could be exactly what you use the annex for.
However, an extension like this could equally be suited to your grown-up children if they’re saving up a deposit to buy a home of their own. With house prices in the UK rising faster than the average wage and buyers typically needing a deposit of at least 10% to secure a mortgage, granny flats inhabited by the younger generation could become increasingly common.
Will it add value?
The Daily Mail claims that while demand for annexes is rising, it’s still quite rare to find a property that offers a good one on the market. If more people really are looking for a home that provides this, then if you add one to your property it could pay dividends further down the line.
As with any extension, it’s important to check whether you need planning permission – although it’s not always required. You should also think carefully about the layout and how it fits in with the main house. While you might be planning for a family member to move in, a future buyer may prefer to integrate the extension with the main body of the house – will this be possible?
Bills, bills, bills
While you’ll have to wait until you put your home on the market (or get it valued) to see whether the annex has boosted how much your property is worth, the addition could start paying for itself before this. Not only could you have the advantage of a reduced council tax bill, but you may also be able to split other household bills – like electricity, gas and internet – with the family members occupying the annex.
One popular reason for asking your parents to move in is to help out with the kids. The cost of childcare can be extremely high, and if you and your partner both work but your parents are retired, you may find you save a fortune by asking them to help out instead. Not having to fork out for nursery is a significant saving.
However, whether or not your parents want to spend their retirement years as a live-in nanny is another matter. Ultimately, the decision of whether building an annex on your property is worthwhile is something you will need to discuss with your family and consider carefully.
To find out which home improvements provide the best return on investment, click here.