Does an extension or loft add value in London?

There are two quite different reasons to extend, and they lead to different decisions.

If you are extending for space, you plan to stay. The question is not whether the sum pays back on a sale date but whether the room is worth the cost to you: a bedroom for a growing family, a kitchen big enough to eat in, an office that is not the dining table. You can afford to spend on things you will enjoy every day, such as better glazing, and getting the layout right matters more than a fair cost per square metre.

If you are extending for value, you plan to sell, or to borrow against the house. Here the discipline is tighter. The extension has to be the sort of space buyers on your street pay for, finished to the standard they expect and no higher. Over-spending on a finish the street will not reward is the commonest way to lose money on the sum.

Many people are in between: staying for ten years but wanting to know the money is not wasted. That is reasonable, and it is the same exercise. Work out the cost, then compare it with what the street will bear.

This guide does not quote house prices, and the report does not give them. They change street by street and month by month, and a figure here would be out of date or wrong for your road. What the report does give is the cost, so you can do the comparison yourself.

Measured on the building work alone, a single-storey rear extension with a good-quality finish works out at about £3,750 per m² of new floor, and a rear dormer loft at about £2,400 per m². The fees and contingency come on top, in the all-in totals.

To compare, look up what a square metre sells for on your street. Ask two or three local estate agents what comparable homes with and without the extra space have gone for, and look at sold prices for your own road on the property portals. Divide by the floor area, and put that figure beside the cost per square metre. If a square metre on your street sells for well above what it costs to build, the sum has room in it. If it is close, the extension is a purchase for your own use rather than an investment.

Per square metre is a rough guide. Much of the cost is fixed whatever the size: steel, drains, stairs, scaffolding and building control. A small project spreads those over fewer square metres, so its rate looks high. Use the all-in totals to budget.

Yes. A single-storey rear extension with a good-quality finish is £61,000 to £114,000 on the London baseline. In Barking and Dagenham, Bexley and Havering, the lowest-cost end of the scale, it is £57,000 to £107,000. In Kensington and Chelsea and Westminster, the highest, it is £70,000 to £130,000.

The borough changes the building work through parking, access and labour, and the statutory fees stay the same. Whether a more expensive borough also lets you recover the extra cost is a question about your street, for the local research above.

Moving is the alternative to extending, and the fair comparison is a list of costs on each side. Put these side by side for your own case.

For moving: stamp duty on the next home, estate agent fees on the sale, solicitors' fees both ways, removals, and any survey on the new place. Get a figure for each. They depend on the prices you are dealing with, so they are not given here.

For extending: the all-in total, which for a single-storey rear extension is £61,000 to £114,000 and for a rear dormer loft £63,000 to £116,000. Inside that are the professional and council fees, £6,500 to £22,500 for the extension and £6,500 to £21,500 for the loft, and the contingency, about £6,000 to £10,000 for the extension and £6,000 to £10,000 for the loft. Then add what is outside the totals: a new kitchen, flooring, decorating, and any time spent living elsewhere.

Then the costs that are harder to count. Moving gives you a different street, school or commute, and extending keeps what you have. Neither belongs in a spreadsheet, but they often decide the question once the sums are close.

This is common experience, not a measured figure. Buyers in London tend to look first at the number of bedrooms and bathrooms, so an extra bedroom with a bathroom is the sort of space people look for. A kitchen-dining room that opens to the garden is the other, because it changes how the whole ground floor is used.

A loft conversion is often the cheapest way to add a bedroom and a bathroom, because it reuses the walls and roof. A rear extension is often the best way to add a kitchen-dining room, because it opens the house to the garden. Which suits you depends on your house and your street, and local agents will say what buyers in your area ask for.

What tends not to pay is over-specifying: a high-end finish in a street of ordinary homes, or an extension that takes the garden below what buyers expect. That is a judgement for the local research, not something this site can work out.

The money is not the only cost. A single-storey rear extension typically takes 23 to 43 weeks from first sketch to sign-off, of which 8 to 16 weeks are on site. A rear dormer loft takes 23 to 39 weeks, of which 6 to 10 are on site.

Most of that time is design, the council's decision and the building regulations drawings, not building. If you plan to sell, start early: a finished, signed-off extension is easier to sell than one that is half done, and the sign-off paperwork is something buyers' solicitors ask for.

Will the report tell me what my home is worth after the work?

No. It is an estimate of the cost of the work, the planning route and the time it takes, not a price for your home and not advice on selling. For what the work might add on your street, ask local estate agents and look at recent sales on your own road.

Is a loft conversion or a rear extension the better buy?

Neither is better everywhere. A rear dormer loft of about 28 m² is £63,000 to £116,000 all in, about £2,400 per m² for the building work. A single-storey rear extension of about 17.5 m² is £61,000 to £114,000, about £3,750 per m². They add different space, so choose by what your house lacks, then check the cost against your street.

How much should I keep back in case the work costs more?

A contingency of 12% of the building work at a good-quality finish (10% at straightforward, 15% at high end): about £6,000 to £10,000 for a single-storey rear extension. It is money to have available, not a cost you will certainly pay. If the comparison with your street is tight, include it in the sum.