While many homeowners are unable to sell property because the value has dropped to the point where they are in negative equity, others are finding themselves unable to afford home improvements as costs have risen 20 per cent.
According to new figures from the Royal Institution of Chartered Surveyors (RICS) and the Building Cost Information Service (BCIS), higher transport and raw material prices, coupled with a decline in the number of available tradespeople, have raised home improvement expenses.
BCIS' updated Property Makeover Price Guide offers mortgage
payers a realistic estimate of how much they should be paying for different types of work and has discovered that the cost of improvements has risen by a fifth over the last two years.
Many central and eastern European nationals previously working in the industry have returned to their native countries, including a million Poles, leaving a shortage of workers coupled with higher costs. Furthermore, rocketing oil prices have led to increased transport costs, and vast global demand for commodities has raised raw material prices.
According to the guide, roofing costs have risen by 26 per cent, plumbing and electric work by 22 per cent and painting has risen by 17 per cent, all outstripping inflation rises during the past two years.
BCIS executive director, Joe Martin, said: "The current downturn in the housing market is forcing some homeowners to become more creative in meeting their accommodation needs. Many are choosing to stay put and renovate or extend in order to upgrade their property rather than taking on more debt
in a falling market.
"This can be a wise strategy as home improvements add value to a property, and people will be well placed to take advantage of this uplift in value when the market shrugs off the current slump. Given that the cost of home improvements rose by 20 per cent over the past two years compared with only eight per cent in average wage growth, many homeowners are opting to act now rather than paying more further down the track."