As we outlined in What to Fix Before Selling a House, improving property and making a profit is not quite as easy as the TV "make-over" shows would have you believe.
To make sure you make money you need to do your research and understand a few key concepts behind adding value to property.
Your goal should be to make your property one of the best in town.
This is because there will always be a buyer willing to pay a "premium" for the best.
In this scenario state of the art interiors (high-end kitchens and bathrooms etc.) and the use of good architects really pay off.
The money you spend has a dramatic effect on the end-selling price of your property.
Your goal should be to bring your property up to the same standard as the rest of your street (maybe a little better but no more).
You'll waste time, money and effort transforming your property into a six-bedroom palace if all around you are 3 bed semi detached properties.
In average locations, don't overcapitalise (i.e. Spend a ton on kitchens, bathrooms and fittings etc.) if you're planning on selling your property for profit.
The sort of money and buyer you'll need will most likely not be interested.
They'll want to spend their money in a better location.
If you know your buyer's general tastes and preferences, it'll be far easier to pinpoint the improvement projects that will make you money.
Always give the buyers what they want, not what you want!
What buyers want and expect differs from region to region, town to town and street to street. There's no escaping it, you need to do some cold hard research.
If you watch your local property market closely, no-doubt you already have a good idea of this.
If you don't, this is where knowledgeable estate agents come in handy.
Given a chance, an estate agent will wax lyrical about "ceiling prices" and "buyers tastes" for hours (if he thinks he'll bag you as a client in the not to distant future).
Speak to a couple of estate agents in your town.
Don't just have a chat with one of the staff. Book an appointment to see the owner (if it's an independent) or the branch manager (is it's a corporate).
If the estate agent really knows his stuff he'll take the time to show you sales particulars of improved properties and explain how they compare to what's currently on the market.
Your goal is to get him to show you proof that an improvement project will make a profit!
The trend at the moment is for more space.
In our ever-increasingly overpopulated towns and cities these are the real money-spinners (but they will involve building work).
Can you stand the disruption of builders, navigate the planning process and find architects and builders you can work with?
If you can, you stand a good chance of increasing your wealth through improving and selling property.
Here are some classic projects that add value:
Every year Nationwide conduct housing market research into what adds value to property.
They publish the actual figures for how much these types of projects can increase the value of your property.
When selling property for profit, it's worth looking at this research as it gives you some excellent general guidelines to follow.
Then go and interview local agents and pinpoint the projects that will make the most profit for you.