According to Savills, there was around one home extension or improvement for every seven sales in 2025, down from the previous average of one in five.
The firm said this reflected weak house price growth and higher construction costs, as typically, a higher level of transactions leads to more home renovations.
Planning applications for home improvements dropped below 150,000 for the first time in 15 years last year. This was 27% lower than the average seen over the last decade and 3% below the previous low recorded in 2024, despite more housing transactions.
Savills said the gap between people moving home and extending or improving was now at its widest point in recent history.
Lucian Cook, head of residential research at Savills, said: “Historically, there has been a strong correlation between transaction volumes and levels of home improvement. Buyers typically invest in upgrading properties soon after completing a purchase, but persistent cost pressures and weak house price growth prospects have made it more difficult to justify taking on these projects.
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“In turn, that means demand has been focused on turnkey properties.”
Source: Savills using MHCLG, HMRC
Fewer renovations across all regions
The drop in home extensions and improvements compared to the 10-year average was seen in all regions across England, but was more notable in the North East.
Most extension and improvement activity relative to transactions takes place in London and the South East, with around a quarter of buyers extending their property.
Still, activity in these regions has declined.
Cook added: “The higher the house prices in an area, the more extending makes financial sense, meaning that more value can be unlocked in London and the South, compared with the Midlands and the North, as build costs are less likely to outstrip the value added.”
