French Property Renovations

Buying a cheap property in France, renovating it and then looking to sell on for a profit. Sound idyllic? It does to many and can be very profitable too, if done correctly.

The general principle behind this type of property investment in France sounds very simple - indeed, you've probably all seen the sort of thing on the plethora of television shows about overseas property investing. In order to make a success of this type of investment, there are some key elements that need to be in place. We'll look at each a bit more closely.

How much work are you prepared to do?

It's vital that you answer this question honestly, realistically and accurately. You'll find that there are plenty of properties in France that need "a bit of work doing to them" - many of them have the potential to be good investments. The problem is that different people have different expectations of how much work they can do.

Taking one end of the spectrum, maybe you think that it would be a good idea to purchase little more than the shell of an existing building. For sure, taking such an approach, you could pick up a very cheap farmhouse in a beautiful rural setting. Over time, the building could be renovated and modernised, allowing you to sell it on at a large profit, maybe run it as a B&B, or separate the property into multiple dwellings, allowing you to make a real return on your investment. Just one problem: who's going to do the work?

Whether you do the work yourself or act as project manager, the task is going to be extremely time consuming. You'll need to keep the work on track - any delays are likely to end up costing you money.

So, the question that you need to ask yourself is this: am I cut out to be involved in such a large project? Am I going to be able to commit the necessary time and energy?

What timescales are you looking at?

Another key consideration is how you are going to go about making a profit on your investment. Is your plan to buy the property, carry out the renovation work in 6 months and then sell on quickly for a profit. This type of approach can certainly be successful, allowing you to make a quick profit and then move on to a larger property next time.

As we were discussing above though, you need to think about how feasible it is. If the property is in a very poor state of repair when you make the initial purchase then is it going to be realistic for you to carry out all of the required work within 6 months, or will you be needing more time.

Funding the renovations

You'll also need to give some thought to how you are going to go about funding the renovation work. Although you may well make a nice large profit over the course of the project, there is going to be a period of time when you will be spending relatively large amounts with little or no return. Cashflow could become an issue, so you'll need to look at the various possibilities, from making use of your savings to looking to take out a loan.

Related Articles:
French Property Investment - we look at purchasing property in France for investment purposes.