How to estimate house rebuilding costs

You'll need to estimate your home's rebuild cost if you want to take out buildings insurance - to make this estimate you can use a rebuild calculator or consult a chartered surveyor.

Key points

  • Rebuild value is not the same as market value - it's usually lower
  • The BCIS's rebuild calculator is available to use when you compare buildings insurance through Gocompare.com
  • Remember that rebuild costs will change over time

If you're searching for home insurance that includes buildings cover then estimating the rebuild cost of your property is a crucial element.

Rebuilding costs encompass the cost of rebuilding your property if it's destroyed, for example in the instance of a fire or a devastating flood.

The rebuild figure is usually - but not always - lower than the property's market value because it doesn't include the value of the land the property stands on.

The rare examples of when a property's value is lower than its rebuild cost could be if a house includes period or special architectural features, or if it's built from stone that's no longer available locally.

How do I find my property's rebuild value?House

If you don't know the rebuild value of your home there are a number of ways to seek it out.

The figure can usually be found in your mortgage valuation report, on the deeds to your home, on a surveyor's report and/or on your buildings insurance renewal documents.

Bear in mind that the value of your home may have changed over time.

The valuation needs to be index linked with inflation, and you need to consider factors such as improvements made, fluctuations in market value and building costs.

Overvaluing the rebuild cost of your property could mean that you're paying more money than you should be for you home insurance
Ben Wilson, Gocompare.com

Rebuild calculator

If you're not confident that you have an accurate, up-to-date valuation, you may want to think about using the rebuild calculator supplied by the Building Cost Information Service (BCIS), commissioned by the Association of British Insurers.

When you compare buildings insurance through Gocompare.com, you'll have the option to use the BCIS calculator when you reach the rebuild valuation question.

Remember that the figure returned will only be a reasonable estimate of the rebuild value and will be based on a good quality house.Thatched cottage

There could be any number of variations that affect such a valuation.

For example, your property may be a small house with a budget finish, or a large house with a high-quality finish.

Chartered surveyor

Another way to find out the rebuild cost of your home is to hire a chartered surveyor to take detailed measurements of your house and prepare a Rebuilding Cost Assessment.

This could cost several hundred pounds, but is something you may want to consider.

The method of assessing the rebuild cost of your home may need to be specifically agreed with your insurer, so be sure to read your terms and conditions.

Did you know...?

  • If you've added an extension to your home then you'll need to re-evaluate its rebuild value and consult your insurer

Over-insuring

Don't make the mistake of over-insuring and paying too much for a premium you don't really need.

Don't insure your home for its current market value or the amount you purchased it for, as these may well be far higher than the rebuild value.

"Overvaluing the rebuild cost of your property could mean that you're paying more money than you should be for you home insurance, as your insurer will only ever pay the cost of the rebuild regardless," said Gocompare.com's Ben Wilson.

Extensions, excesses and exclusions

If you've added an extension to your home then you'll need to re-evaluate its rebuild value and consult your insurer - this should be done periodically every few years.

Check your policy's terms and conditions for full details of what's covered and for any exclusions.

Flood risk and subsidence may require extra attention and information, for example.

By Emily Bater