Wednesday, November 2, 2011

Spending on your property to beat the downturn?

According to an article in today's Telegraph* newspaper, many Britons are being advised to spend money on improving the property they already own, in order to 'prepare it for the market' when prices are predicted to rise again in two or three years time.

However, the writer Caroline McGhie, offers some words of caution - including not over-spending for example, to the extent that a property stands out as 'expensive' compared with other houses in the same street. It is well known that seekers of four-bedroom houses do not search in a three-bedroom street, and adding luxury items such as a swimming pool or jacuzzi can tend to put a property out of context with its neighbours. After all, birds of a feather tend to flock together...

Some estate agents also advise caution - not spending excessively on a property that is already seen as at the top of its price range, and thereby making it stand out among similar properties in the area. Another advises that certain improvements are only worth their cost if the owners are convinced they intend to stay in the house long term - and who can tell these days? - rather than sell up and move within a couple of years.

Will it work in France? Although as the previous post (below) indicates the French are 'starting to think more like Anglo-Saxons' and see their home as an investments as well as somewhere to live, transaction costs tend to be high, including agency fees, the notaire's fees and French government taxes. As a rule the French are reluctant to change areas, for eample to find work even in times of recession, because of family ties and responsibilities - children in school, spouse's own job, caring for ageing parents.

However, mong the principal reasons for moving are the need for more space, as children grow up and more bedrooms are needed, so any improvements that offer more living space as opposed to greater comfort will generally add value to a property, though all the cautions noted above also apply.

* The Telegraph online, 01 November 2011