Can A Home Office Increase Your House Value? A Reality Check

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When I first designed my home office one of the things that worried me would be a potential drop in house value. I mean the last thing I wanted to do is put all of my effort into a new home office only for the value of my home to drop. 

A home office will increase the value of your home. Any home improvement will increase the value of your home unless you are converting an entire bedroom to an office.  For best results consider converting your loft into a home office space to increase your homes value by 20%. 

So why does a home office increase your house value? Are there any other improvements that you can make to help increase your house value? It’s time to dive in and learn a little more!

(Just a heads up a lot of people reading my blog are in the process of designing their own home office. If you want to save some of the painstaking time I did in designing my office, you can find my recommended products here)

Can a home office increase your house value? 

Let’s paint a picture, you’ve just spent the past few months pouring all your blood, sweat and tears into your home office. You’ve finally got it to look how you want and are now looking to sell the property as soon as possible. I know one of the things I was super nervous about was if adding a home office would increase the value of my house. 

Any home improvement is likely to increase the value of your home. Home offices are becoming more and more prominent these days with the amount of people working remotely increasing from 3.1 million to 4.7 million in just a few short years. 

In the UK this is also true with ONS statistics home working up almost a quarter then it was a decade ago. With this, people are getting more and more creative with how they design their office. Not only out of necessity, but to really allow them to become a hub of productivity. 

Now the housing market in general has increased in massive proportions over the last 20 years (albeit with a small drop in the financial crash in 2008). Although it seems like a seller’s market, people are really looking for ways to increase the value of their homes. 

The good news, (if you’re a fan of this blog that is…) is that any home renovation is likely to increase the value of your home – Including offices. Now this doesn’t mean replace the bathroom in your one-bedroom flat into an office but generally any renovation can help. 

 

How much can home offices increase the value of your house by? 

Office conversions can increase the value of your home by up to 20%. 

For example, if you spend about £30,000 ($35,310) on your loft conversion and your house is worth £200,000 ($235,000), you could potentially make £10,000 ($11,770) profit – not bad for a few weeks worth of work right? 

What’s even better is with the advent of home working, people are looking for more and more places to not only work, but decompress. Setting up something like a garden office, or garden room would increase your house value by an additional 5% According to Garden Affairs an investment of £6,653 ($7830) could add £35,611 ($41,914) to an average home.

Some even suggest that a home office could increase the value of your home by £120,000 – £150,000 ($176,500) although I personally feel that this is a little bit too optimistic for a simple new home office. 

 

What room should you convert to an office, to increase your house value the most? 

The majority of us most likely don’t have homes that have come with offices built in, instead we will likely be designing them from scratch, which is fantastic as you get to make it just right for you. 

So which room should you convert to an office to increase the house value the most? I can’t stress this enough but under any circumstances do not convert an existing bedroom into a home office. 

If you go from a 3 bedroom house down to a two bedroom house with a fixed office (meaning an office that is not movable or future proof with the ever changing needs of your family) then you will likely actually lose money on your house.

My recommendation would be to invest in a loft conversion (if possible) which would increase the value of your house by about 20% and then place the office in there. 

Alternatively if heights are not your thing, potentially look into setting up a garden room outside or use an old pantry, storage cupboard to set up an office space. 

 

Will an increase in home value increase the cost of your mortgage payments? 

So now we know that designing a home office (albeit in the right manner) can potentially add thousands to your house value, there are some other questions we need to answer. 

 

Will home office increase the cost of your mortgage payments?

 Unless more than 40% of your home is going to be used as a commercial working space most mortgage providers will keep any mortgage payments as a residential income. 

It is also important to note that this advice may only apply to people who work for someone else, if you are self employed or run a commercial business through your home office, this advice may differ. 

It’s worth mentioning though, there can be some occasions when this will be different and this is not legal advice so it is best if you speak to your own mortgage provider just to confirm. 

 

What else can increase the value of your home? 

Okay home office aside, it’s likely that you’re looking at more ways to increase your home value rather than just doing the bare minimum? 

So what improvement can you make to improve your selling options? Are you second guessing that weird wallpaper that cost £70 ($82) a square meter?

Luckily, I’ve pulled together two tables; one showing what you can improve and how it can increase the value and the other showing you what you should avoid: 

 

Improvements You Should Do	Why
Extra Bathroom	Anyone who’s lived in a shared house with one bathroom knows exactly why the convenience of a second bathroom can add value to your house. This can add value by about 5%.
Open Plan Living area	Open plan living areas really open up your living space and makes your living room feel a lot bigger than it really is. This can increase your home value by 6%.
Loft Conversion	I’ve said this before but a loft conversion can add extra room to your home, converting an old storage space to a liveable space. This can potentially add up to 20% on your house value.
New Bedrooms	Everybody loves bedrooms, even spare bedrooms, especially estate agents who suggest that an extra bedroom can add upwards of 10% in value.
Extension	Although very pricey (and seemingly getting more and more expensive!) extensions because of the simple fact that you are extending your house size can typically increase your house value by 11%.

 

Improvements You Should Avoid	Why
Big Lighting Fixtures	Whatever lighting looks good today almost always looks terrible in the future, stick to classic.
Textured Walls	These can be super difficult to remove and amend, as such anyone looking to buy doesn’t want a timely project on their hands as soon as they buy.
Carpet In Every Room	People are much more likely to pay more money for properties with hardwood flooring vs having homes with too much carpet in them.
Combining Bedrooms	Like I said earlier, removing any bedrooms of any kind is a huge mistake to make, people pay more for more bedrooms.
Bad DIY Repairs	One of the worst things you can do to reduce the possible value of your home is poor DIY, badly fitted shelving units and knocked down walls really don’t go down well.

Another thing you may want to avoid is having a home office that is used by multiple people outside your household. Not only will this increase the risk of wear and tear but this might also have other significant drawbacks that I;ve covered in a separate post here.

How else can you improve the value? 

Homebuildingandrenovating.com have a great article on their website talking about a bunch of other methods to improve the value of your home. These include things like investing in heating systems, new roofs and many more areas that don’t necessarily relate to just a home office.

You can check it out here. 

Wrapping Things Up

So to summarise, adding a home office can really shoot up the value of your home. On some occasions by over 20%. 

But what have you found after setting up a home office? Have you managed to sell your home? If so, did you get a bigger price than you expected? 

Leave a comment below and let me know your thoughts!

Finally a lot of people reading my blog want to know what products I recommend for a home office/remote working. You can find out my recommendations here and learn how I make money whilst working remotely on the side here.

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