UPSIZE OR EXTEND? IT’S A COMPLEX ISSUE

As the housing market cooled during 2025, a question I was increasingly asked, mainly by growing families who needed more space in their homes, was: would they be better off using the money they would have spent on moving to a larger home or extending the one they already live in, writes Kate Gillard.

On the surface, this has several benefits, particularly at a time when the market has been slow.  Staying put in a house which might seem ideal apart from the number of bedrooms - especially if existing children were settled in local schools - makes some sense.  And surely, the cash invested in extending the existing house would be balanced by the increase in its value, meaning you would be sitting on as big a future asset as if you upsized?

The truth is, there are several factors to take into account here, and it’s not quite as clear-cut as it may first seem.

First of all, extending a house is not as straightforward as it might seem.  Aside from navigating the labyrinthine planning system, finding a reliable contractor who will finish the job on time and on budget is notoriously difficult.  The whole process can be months of hassle.

If you have another baby already on the way, the chances of having the project finished by the time it’s born are slim.  Are you prepared to live the crucial first six months of the new-born’s life in a building site?

But perhaps the main argument is financial.  Yes, moving house is expensive, what with legal fees, surveys, removals and the like.  But so is commissioning building work, and there is absolutely no guarantee that this investment will be reflected in the value of your extended home.  Ceiling prices on certain styles of property matter, regardless of how much work has been done.  Not all improvements add ‘pound for pound’ value.  

With confidence slowly returning to the market, and interest rates on their way down, selling a home is certainly easier than it was in the second half of 2025, so that side of the equation also points to upsizing being the better option. 

For those who are emotionally invested in their property, staying put and extending could be the desired choice; however, moving might be more financially suitable.  Making that decision means understanding what is involved in undertaking an extension (both financially and logistically), and knowing how the market is actually performing in your area.

An honest conversation with a local agent who has knowledge of how the market is performing in your area will be able to provide unbiased, rational advice.