The Value of Design: How good design translates into a significant price premium

‘Good design’ has a tangible effect on property prices, lifting the PSF value of a prime London residence by an average of 19% according to new research by The Modern House. But what makes modern design good?

A well-designed home in London attracts a 12% price premium per square foot over a more run-of-the-mill residence, according to some new research by specialist estate agency The Modern House and Dataloft. And form plays a greater role in the prime arena; the average design premium for a London property over £1m is a punchy 19%, while good-looking homes under seven figures command an average PSF price 10% above a prosaic comparable.

“Design is a real differentiator for today’s home buyers and they are prepared to dig deep if they can see design having a tangible effect on their lifestyle,” says Albert Hill, co-founder of The Modern House. “More than ever people are looking for transformative experiences and so the enthusiasm for investing in a great home space is not surprising.”

This Grade II listed property on Queensbridge Road E8 (near London Fields) features a striking modern extension by 51 Architecture, and won a RIBA Award in 2008. It sold via The Modern House in July 2017 for £1.9m – achieving 23% over the average per square foot price for the area. More details here

“Design is a real differentiator for today’s home buyers and they are prepared to dig deep if they can see design having a tangible effect on their lifestyle”

Albert Hill, co-founder of The Modern House

Of course judging what makes architecture and design “good” is pretty subjective. Which is where The Modern House boasts a particular skill-set; founders Albert Hill and Matt Gibberd were highly-respected design journalists before moving into property proper (Gibberd was Senior Editor at The World of Interiors; Hill was Design Editor at Wallpaper*). They recently sealed their maestro credentials by penning a “visual manifesto” in celebration of Modernist architecture, which was published by Phaidon last year.

Applying some journalistic rigour to an anecdotal trend, Hill and Gibberd brought in property research house Dataloft to quantify the value of design in London’s property market – comparing the underlying per square foot sale values of homes with “high design values” against the mainstream market, and identifying any monetary difference between the two.

Over 14,000 residential property sales were looked at across the capital, with 212 identified as having the right design stuff. All these deals took place between 2014 and 2017, and were benchmarked by Dataloft by year of sale and postcode sector. The results indicate that there is indeed a price premium associated with high design values, and that premium has been relatively consistent over the past few years – despite a pretty turbulent London market.

Higher value markets tend to have a higher percentage premium (averaging out at 19% for the £1m+ transactions looked at, compared to £10% for the sub-£1m deals) – but there’s a limit. There isn’t really a mainstream market to benchmark super-prime (£10m+) homes, so little evidence for a design-related premium…

It’s worth noting that, as ever, there are multiple other factors at play here. One that The Modern House is keen to flag is that design-focused homes tend to have more compelling marketing materials; specialist architectural photographers are more adept at capturing a property’s character and highlights than generalist snappers, while Modern House particulars tend to go into more depth on provenance than might be expected for a “normal” home.


To help us layfolk identify elements of “good design”, The Modern House’s Hill and Gibberd have compiled a check-list that may prove handy for anyone looking to create a more beautiful residence (and take advantage of that design premium). Key things to consider when designing a home are:

  • The use of a carefully chosen palette of materials throughout
  • A focus on natural light
  • A good flow of internal space
  • A considered relationship between internal and external spaces
  • Visually engaging forms both in internal and external design
  • A sense of spatial drama perhaps through high ceilings
  • A well curated range of fixtures and fittings

Here’s what that list might look like in the real world:

Design Case Study #1: Highlever Road, W10 For sale at £2.75m

Design checklist for a 2,000 square foot four-bedroom house refurbished to designs by Staffan Tollgard, which is on the market with The Modern House at £2.75m.
1. Skylights are far more effective at bringing light into an interior than windows
2. Thin frame on sliding door diminishes barrier between inside and out
3. Floor level extends to outside at some level, with same material, dissolving barrier between interior and exterior
4. Consistent use of echoing rectangular forms
5. Hob sits almost flush in a solid surface worktop
6. Consistent white colour scheme with flashes of bright colour
7. ‘Floating’ cupboards give an impression of levity
8. Lack of handles give an uncluttered appearance
9. Views to greenery have proven positive effects on wellbeing
10. Varied ceiling heights within a room engage and stimulate spatial perceptions
Full property details here

Design Checklist #2: Keeling House, E2 Sold for £395,000

This small one-bed apartment in a Grade II* listed Modernist landmark on Claredale Street E2, designed in the 1950s by Denys Lasdun, sold via The Modern House for £475,000.
1. The colour scheme is simple and light in tone to make a bright, uplifting space
2. The floor-to-ceiling shelving gives the radical effect of holes cut out of a wall
3. The shelving acts as a storage space, display area and room divider
4. An uplighter creates more atmosphere in a small space than a strip of spotlights
5. Window reach right the way to the ceiling, maximising natural light
6. A window ledge is perfect for perching greenery on
7. The window frames are as slender as possible so as not to impede the views from this high rise apartment
8. The furniture is a variety of textures – like cork and velvet – to contrast with the clean lines of the space
9. The main wall is left empty so that a relatively small space isn’t overpowered and so that the focus is on the natural light
10. There is no cornice, in keeping with the minimal look of the space
Full property details here