“Garage conversions are not a good idea for resale value,” says Realtor Adam Aguilar. “In fact, it is detrimental to the value, not only for you, but for the buyer's lender as well. Even if the buyer thinks it holds value, the lender will tell them differently.”
Generally, a well-designed garage conversion can increase your property value by 10%-20%. If you add a bedroom with an ensuite, this will typically see the property value increase the most. A home office or living area will see less increase, but could still be a good investment.
Whether or not converting your garage is a good idea can depend on whether you're planning to stay in your home or want to sell soon. If you have no plans to move anytime in the near future, converting your garage into a more livable space can certainly add a great deal of personal enjoyment to your home.
It is estimated that a functional and finished garage can add $5,000-$25,000 worth of value to a house in California. According to Remodeling Magazine, a detached two-car garage costs about $50,000 to build and recoups nearly 65% at resale.
In my experience, garage conversions typically do not add value to a home. Right off the bat, a large handful of buyers will not even be interested in the property if it does not have a garage. Therefore, the seller is missing out on about 60% of the potential buyers.
The size of the garage greatly affects its appraisal value. Larger garages typically add more value to a home due to the additional space for vehicles or storage. For instance, a two-car garage will generally be appraised higher than a single-car garage because it offers more space and functionality.
As long as you complete your garage conversion properly, it will add value to your home. The value itself depends on how seamless the conversion is and the type of room you build. Typically, you can expect to recoup about 80% of the project cost. But your home can lose value if you ignore three key factors.
A garage, however, might be counted toward the total square footage if it has been finished and made livable. In order to comply with local construction laws and requirements, the garage must be modified.
Planning permission for a garage conversion is not necessary in many cases, although it is always best to double check with your local authority first. Most integral garage conversions fall under Permitted Development which means there is no need to make a planning application.
Since California has passed the new ADU laws this year, usable rooms like garage conversions can be used as a source of passive income. Even if you're only planning on converting the garage to an additional bedroom or home office, permits will be needed for residential construction.
Total Costs
On average, you should expect to pay between £5,000 to £10,000 for a simple garage conversion. This rises to between £12,000 to £30,000 for a double garage conversion. It's a good idea to budget between £625 and £1,250 per square metre.
Con: Loss of Storage Space
Many homeowners use their garage for additional storage, so before you make the decision to alter the space, make sure you have a plan for your storage needs. Better yet, downsize your possessions for a little more breathing room throughout your home.
Typically, the cheapest type of garage conversion will just involve blocking up the garage doors and finishing out the walls, floors, and ceiling with insulation, drywall, carpet, or other flooring material.
They can be great for storage, help you to keep your car safe and even lower your car insurance premiums. But depending on your setup, removing your garage could also help you to gain other benefits – whether that's to do with increasing the size of your garden or gaining more living space.
The remodeling market in 2024 is poised to remain strong. While the market saw a temporary slowdown in 2023 due to rising interest rates and economic uncertainty, 2024 is expected to stabilize with homeowners regaining confidence.
In a word, yes.
However you decide to use the garage, you'll be gaining valuable extra living space for your home. The great thing about a garage conversion is that it is generally less expensive and quicker to complete than building a house extension.
Garage Conversion Costs are Generally Lower
Your overall cost depends on a lot of factors, including the materials you choose and your specific aims for the conversion, but generally speaking, a garage conversion will cost less than building a new freestanding ADU because some of the structure is already in place.
It depends on your intentions. If you plan on permitting this as habitable and condition, then yes, the floor height has to be raised and match the finished floor height of the house. But, if your just going to make this a recreational room you do not have to raise the floor.
A garage can add between 5% to 20% to a home's value, depending on factors such as location, design and the existing housing market. This increase can be especially significant in suburban areas where parking space is a premium.
If you're looking to maximize your home's value, consider converting your garage into a livable space. Adding a bedroom, home office, or even a rental unit can significantly boost your home's market value. While this is a more substantial investment, the payoff can be substantial.
Having a garage will nearly always help you sell more quickly and likely at a higher value than a home without one. The bottom line, buying a home with a garage won't hurt your investment plans (unless it's a mess and falling down!) and will likely help you sell with a higher future value.