How to get a bigger home in an unforgiving market

The odds have been stacked against anyone looking to buy a bigger home. Not only have larger properties increased in value much more than smaller homes since the Covid pandemic, but higher mortgage rates have made it significantly more expensive to bridge the value gap through borrowing.

In order to trade up from a semi-detached to a detached house, the average household in Britain would need an extra £176,610 – or 63pc of their property’s value – according to exclusive new research from Hamptons estate agency. In cash terms, this is the biggest increase since Hamptons started recording the data in 2004.

Moving from a typical terraced house to a semi is less of a leap at an average of £44,370, yet this 19pc premium is still the biggest percentage gap since 2005.

Most of the areas with the biggest percentage gap between a semi and a detached house are in the London commuter belt, explains Aneisha Beveridge, of Hamptons.

“Typically, trading up to a detached house gets you much more outdoor space and larger rooms than upsizing from a terrace to a semi,” Ms Beveridge says. 

“Homes in the commuter belt were significantly affected by the post-Covid race for space and therefore the premium attached to the largest properties has risen more.”

While the number of home purchases has fallen – mortgage approvals in October were a third below their five-year average – many people have still managed to move to bigger homes this year. Increasing numbers have bought in cash, meaning that Savills estate agency expects cash purchasers to make up 43pc of transactions in 2023, far higher than the 35pc seen pre-pandemic.

Other upsizers have compromised on location – Hamptons says 23pc of movers have relocated to a more affordable area, up from 18pc in 2022. Rachel Johnston, of Stacks Property Search, says: “Adjusting your search area is one of the best ways of finding better value, or a more affordable property.”

For example, two of Ms Johnston’s recent clients started their search in the Cotswolds but, unable to find anything to suit their budget, started looking in Northamptonshire.

“It’s similar to the Cotswolds in terms of architecture, village life, market towns and rolling countryside, but properties are 25pc to 30pc cheaper,” she explains. “It’s an easier journey into London and much less popular with tourists.”

And some trading up have capitalised on the falling demand for bigger homes. Polly Ogden Duffy, of John D Wood & Co estate agency, says: “Larger family homes are the costliest to maintain and more of these have come onto the market as older homeowners have sought to downsize. Provided you can afford the higher mortgage rates, or are a cash buyer, you can take advantage of heavy discounts.”

We spoke to three people who used different tactics to gain bigger homes in the difficult market of 2023.

We bought a project

Many buyers have baulked at properties that need work due to the costs of materials, which skyrocketed in the wake of Russia’s invasion of Ukraine in February 2022.

Although annual price inflation is slowing – UK construction materials prices in September were 1.8pc lower than a year ago, according to the Office for National Statistics – they are still historically very high.

“In September, UK construction materials prices were 40.1pc higher than in January 2020, pre-pandemic,” says Professor Noble Francis, economics director at the Construction Products Association.

However, those who are happy to spread renovations over several years or do some of the jobs themselves have managed to scale the ladder. Duncan Petrie, of Savills Cranbrook, says: “Properties requiring a lot of work are priced accordingly and they can be an attractive proposition for someone who wants to create their dream long-term home.”

Carla Baker and her husband Richard have three children: Hayden, 14, Ethan, 13, and Freya, 12. The family had spent 17 years living in a house they built in the village of St Mary in the Marsh, near the Kent coast, but wanted to move closer to the children’s school and to relatives.

They came across a Grade-II listed, six-bedroom house set in 0.7 acres in the village of Woodchurch, near Tenterden. It was initially out of their budget, but was then reduced.

“It was still quite a jump up in price, but we thought it would be a lovely period property with space for our work,” says Mrs Baker, 36, who runs the ventilation company RB Central Systems with her husband. “We booked to see it and that’s when my dad told me that the house used to belong to his grandfather, my great-grandfather. We felt it was meant to be.”

The seller had bought the property from Mrs Baker’s great-grandfather 40 years ago, and was very understanding when the Bakers’ buyer fell through, waiting until they found a new purchaser. This meant the two sales could go through, both via Savills, and the Baker family moved into their new home in April.

“We were very fortunate because we had equity in our property and were able to secure a reasonable mortgage rate before they went up to 6pc,” says Mrs Baker. “We are doing work to it but that’s part of the enjoyment because this is an amazing old property that’s our forever home – and my husband can turn a hand to anything.”

We sold up, then rented

While large homes in some areas have struggled to sell this year, others have still seen plenty of competition from buyers. St Leonards, in Exeter, is one of those places – by the historic Quayside and close to the city centre, it has sought-after period properties, a variety of independent shops and eateries and is close to several schools.

Alice McGeown and her husband, Steven, had been trying to move from their 1930s semi-detached house on the edge of St Leonards to a larger home in the area, but kept missing out.

“In the end, we spent more than two years looking for a bigger home,” says Mrs McGeown, 42, who works in communications. “We were often competing with people coming from London who were prepared to pay over the asking price, whereas we were being more realistic about what we offered.”

Taking advice from Isabel Clifton, from Strutt & Parker’s Exeter office, the McGeowns decided to sell up, move into a rented property and then resume their search. Doing so meant that this summer the couple – who have two young children – were able to pounce on a six-bedroom semi-detached Edwardian home in the centre of St Leonards, also being sold through Strutt & Parker.

“The people we bought from had lived here for 34 years and brought up their four children in the house,” says Mrs McGeown. “It’s not modernised and we will do things to it over time but are not in an immediate rush. We feel very blessed to live here.”

My old house feels like new

As the inflation rate has started to fall and mortgage rates have drifted down, George Omalianakis, of GOAStudio London architects, says the appetite for renovations has started to creep up. 

“Homeowners are deciding that the future looks a bit better now and it is worth the risk of creating their dream home, or upgrading their existing one,” he says.

Among them is Denise Wakeford, who has just spent 15 weeks and a total of about £90,000 overhauling a tired, two-bedroom 1970s bungalow in a village near Petersfield, Hampshire.

The works, undertaken by Rogate Construction, involved redesigning the house internally to make the most of wasted space; knocking down walls to create a modern, open-plan kitchen and living area; converting the garage into a third bedroom; adding a utility room and a small ensuite bathroom to the principal bedroom; and even putting in a dream feature – a walk-in larder.

“I have lived here since 2020 and needed to do something with the place or move,” says Mrs Wakeford, 62, a hairdresser, who sought advice on her renovation at a Homebuilding & Renovating Show.

She lived with a friend during the works and kept all her belongings in a shipping container on the front drive, also taking the opportunity to put in a raft of energy-efficiency measures.

All the windows have been replaced with double glazing; there is a new 3,000-litre water tank under the garden decking to collect grey water to flush the lavatories and water the garden; and 100mm of insulation has been added under all the suspended wooden floors.  

“It used to be so cold and draughty that I could never walk on the carpeted floors barefoot,” says Mrs Wakeford, who also pulled down the external wall at the back of the bungalow, replacing French doors with glazed bifolds.

“These have views on to the South Downs and it now feels like I have a completely new home. It would have been such a shame to leave here as my brother lives in the village and my parents, grandparents and great-grandparents lived here, too.”