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Waste of space – homeowners sitting on £791.5bn in spare room value

The value of the nation’s spare rooms is estimated at around £791.5 billion, and that’s just those of homeowners that admit to having two more, new research from Boomin shows.

Data from the property platform found that 50% of us have one spare room within our homes. This spare space is currently valued at £42,000 per room in the current UK market – the equivalent value of 1.3 Bitcoins or just over the average annual London salary.

London is home to the most expensive spare room value at £76,476, followed by the South East (£54,346) and the East of England (£49,211).

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Even in the North East where this value is at its lowest, homeowners are still sitting on a spare room value to the tune of £21,881 per room. 

However, statistics from the English Housing Survey by the Office for National Statistics show that 38% of homes in England are under-occupied – meaning they have two or more spare rooms. With 24.7 million homes across England, that’s 9.4 million homes boasting two or more rooms that are largely surplus to requirement. 

Boomin estimates that, even at just two spare rooms in total, the current value of this spare space is a staggering £791.5 billion – and that’s without counting those with just a single spare room. 

To put into perspective, £791.5 billion is more than the entire GDP of Mexico and enough to purchase 9,062,761 brand new Porsche 911s. 

Once again, the capital ranks top where this total spare room value is concerned, with the capital accounting for an estimated £211.2 billion worth of spare rooms value, with the South East (£1.65 billion) and East of England (£102.2 billion) also exceeding £100 billion.

Boomin explains one way to get your spare room generating value rather than wasting it is via the government’s rent a room scheme. This allows you to generate rental income up to a maximum threshold of £7,500 per year without paying tax. That’s £625 per month in rent for a room you may otherwise rarely use. 

Michael Bruce, chief executive officer and founder of Boomin, comments: “Many of us have a spare room and during the pandemic, they’ve been used as home gyms, offices, art studios and more, as we’ve tried to maintain some sense of normality both professionally and personally.”

“However, for many of us our spare room or rooms will generally sit untouched besides the odd visit from friends or family and they tend to double up as an overflow storage space for our old clothes, kids toys or other obsolete household items.”

“This is quite amazing when you consider that this underutilised space is worth over £40,000 per room and it certainly begs the question as to whether some homebuyers could save a considerable sum by being more realistic about how much space they actually need, compared to how much they would like,” he adds.

“Alternatively, the government’s rent a room scheme provides the potential to generate some additional income from your spare room and you could earn up to £625 a month tax-free.”

Table shows the current average value of a spare room across each area of the nation

Location

Current average property price

Average price per sq m

Spare room value (10.88 sq m)

London

£516,285

£7,029

£76,476

South East

£366,883

£4,995

£54,346

East of England

£332,216

£4,523

£49,211

South West

£298,600

£4,065

£44,231

East Midlands

£228,290

£3,108

£33,816

West Midlands region

£226,279

£3,081

£33,518

North West

£195,325

£2,659

£28,933

Yorkshire and the Humber

£193,675

£2,637

£28,689

North East

£147,719

£2,011

£21,881

England

£285,113

£3,882

£42,233

Wales

£203,224

£2,767

£30,103

Scotland

£181,391

£2,470

£26,869

Northern Ireland

£159,109

£2,166

£23,568

United Kingdom

£268,349

£3,653

£39,750

Table shows the average value of two spare rooms and the number of under-occupied dwellings (two or more spare rooms) as well as the total value

Location

Spare room value

Value of two spare rooms

Total number of dwellings

Number of under-occupied dwellings (38%)

Estimated value of spare rooms

London

£76,476

£152,953

3,634,497

1,381,109

£211,244,259,710

South East

£54,346

£108,691

3,984,708

1,514,189

£164,579,017,577

East of England

£49,211

£98,421

2,733,183

1,038,610

£102,221,019,927

South West

£44,231

£88,462

2,604,354

989,654

£87,546,797,923

North West

£2,659

£57,866

3,333,545

1,266,747

£73,301,841,925

West Midlands

£33,518

£67,037

2,536,706

963,948

£64,619,785,919

East Midlands

£33,816

£67,632

2,123,763

807,030

£54,581,182,281

Yorkshire and the Humber

£28,689

£57,377

2,460,706

935,068

£53,651,765,983

North East

£21,881

£43,763

1,246,438

473,647

£20,728,090,939

England

£3,882

£84,466

24,657,900

9,370,002

£791,450,904,905

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