According to a revealing analysis by Foxtons, adding a basement to your London home could skyrocket its value by an astounding 54%. This increase is calculated based on the new living space created, turning previously unused square footage into a lucrative investment.

Costs vs. Rewards

Let’s break down the numbers. With the average price of a London home pegged at £8,210 per square meter, introducing a 56 square meter basement living area could potentially hike up your home’s value by a whopping £460,000 in the current market. However, it’s not all good news immediately. The creation of a new basement comes with a hefty price tag of about £3,000 per square meter. Add to this the architect and planning fees, and you’re looking at an estimated outlay of £168,000 for the entire construction process.

But here’s the bright side: after considering these expenses, London homes could still see an average value boost of £292,000, as noted by Foxtons.

More Space, More Value

Guy Gittins, the chief executive of Foxtons, emphasises the undeniable appeal of expanding living space in London homes. While many opt for extensions or loft conversions, those daring to “dig down” can significantly enhance both the size and value of their property. Gittins acknowledges the complexities and substantial budget required for such renovations. He also warns of the potential for neighborhood discord due to the extensive construction work involved.

Nonetheless, for those capable of undertaking such a grand project, the rewards are immense. Not only does it elevate the property’s market value, but it also increases its attractiveness to potential buyers, setting it apart from other properties on the market.

The Prime Market is Where Basements Shine Brightest

In London’s prime market, the value added by basements is even more pronounced. Foxtons’ research showcases that in upscale areas like Kensington and Chelsea, a basement addition can augment the average home value by nearly £1.2 million, post-construction costs. This translates to a staggering 96% increase in property value. Other boroughs like Camden, Islington, Westminster, City of London, Hammersmith and Fulham, and Wandsworth also report significant value uplifts, ranging from 69% to 84%.