Anyone who has ever done construction work on their home — or just looked at Grand Designs — knows that renovations almost always cost more than expected. There are inevitable delays, unforeseen problems and the weather rarely plays a role. But for hundreds of thousands of people currently tackling an extension or home renovation, the increase in costs is unprecedented.
According to analysis of government data by estate agency Savills, approximately 246,307 building permits were issued in England in the year to March 2022. This figure is 29 percent above the pre-pandemic norm and an increase of 21 percent in the previous 12 months.
Legions of other people are doing work that doesn’t require a building permit, and they’re all struggling with the cost of building materials at “all-time highs,” said Brian Berry, of trade organization the Federation of Master Builders. “It is driven by a range of problems such as inflation, export duties, the war in Ukraine and energy costs,” he says. “Steel and cement, which are energy-intensive to make, are skyrocketing in price.”
This has led to 83 pc of builders raising prices. “Builders are forced to raise prices to stay solvent, but face a clientele that tightens the belt as the cost of living increases,” added Mr Berry. “And the situation doesn’t seem to be improving as 95 percent of small builders expect materials prices to rise again this quarter.”
Many homeowners report that builders routinely add 20 percent contingencies to quotes as a hedge against inflation. And the pain is exacerbated by ongoing shortages of items such as bricks and paint – paints in particular are being hit by shortages of raw materials caused by ongoing lockdowns in China and the war in Ukraine.
Website Rated People found that a bathroom renovation will cost an average of £5,726 this year, 22 percent more than in 2021 and 40 percent more than in 2020. An attic renovation is expected to cost 25 percent – or £7,000 – more than two years ago, while the average expenditure on an extension is now £37,893, up 9 percent from 2021 and 23 percent more than in 2020. This crippling cost is causing more people to rethink their home improvement plans, said Peter Dallimore of Coutts bank. “We see people shrinking plans or delaying projects until there is more certainty in the market,” he said.
The Royal Institute of British Architects, a trade association, said architectural practices reported that projects were canceled in tender as costs for homeowners began to climb, while Frances Clacy, of Savills, said building permits had begun to wane from the peaks expected in 2021. were seen, largely due to rising costs and the low availability of building materials.
In the three months to March 2022, a total of 52,564 permits were granted in England, down from the peaks of 68,690 in the second quarter of 2021 and 67,030 in the third quarter.
More and more people even stop buying a house due to rising material costs.
A house in need of refurbishment in Acton, west London, went on sale this spring, after it was put on the market by Harry Hammonds, of Aston Rowe brokerage. A contractor had submitted a quote for the work and the purchase went through, but two months later, just before the contracts were due to be exchanged, the contractor increased its original quote by £75,000.
“This was because materials and labor became more expensive, forcing the buyer to pull out of the purchase,” said Mr Hammonds.
However, many renovators still plow through. Here, those at the sharp end share their stories of rising prices and compromises made.
‘I used to be ashamed to ask for discounts, but you have to’
Jude Edgell and her husband, Terry, bought a castle near Cowbridge, in the Vale of Glamorgan, in 2018. The property, set in nearly 72 acres, was up for sale for £1million but in need of serious TLC – the roof collapsed, the walls were crumbling and about a third of the building was dilapidated. The whole place was also riddled with dry rot.
Nearly four years later, the couple are still refurbishing Penllyn Castle, which dates mainly from the 18th and 19th centuries, but parts of which are thought to have been built around 1135. the builders recently excavated more than 100 tons of soil to simply lay new floors on the ground floor and install underfloor heating.
In recent months, rising prices have really started to bite. “Building material prices have doubled in the last two years – some woods have gone from £200 per cubic meter to over £500,” says Mrs Edgell, 59, for whom overseeing her massive renovation is a full-time job.