City Living: Adding value to your 'first' home requires research, says Edel Morgan

You've bought the stepping stone home - the one you will live in for up to five years en route to your dream home. It is in need of an update and, while you plan to boost its value by renovating, you don't want to go overboard and end up selling at a loss in a few years time.

Before you call in the builders, it might be wise to look at the ceiling price being achieved for houses in your neighbourhood.

For example, you buy a house for €350,000 in need of redecoration and without an extension, and a typical price for extended houses on your street is €370,000-€380,000. If the top price being achieved for a house in immaculate condition is €400,000, it might be unwise to spend €50,000-€70,000 on an extension if you plan to move out within a few years and have other costly renovation work to do.

Predictions for price growth this year range between 5 per cent and 15 per cent on second-hand homes; so if you were to bank on a conservative 6-8 per cent per annum growth, you need to spend carefully to make a decent return on your purchase.

If an extension would blow your budget, an alternative could be to convert a room within the existing house - like the attic or the garage - which will cost significantly less and will add value. Conservatories are another option. However, it is reasonably expensive to do a good job and estate agent Simon Ensor of Sherry FitzGerald says he is not convinced it will increase your house's worth by much.

"I'd say if you are doing it at all it's worth doing right and, if you are going to build one, do it because you are going to get enjoyment out of it - not to add value."

Many conservatory companies also do sunrooms, which although they have plenty of glass, usually come with a tiled roof and Velux windows and are more suitable for all-year round use. While the ubiquitous "polished timber floor" is appealing to many, it may not be cost-effective.

"There is likely to be no real differential in value between a house with a timber floor and one with nice carpets. Wooden floors can be very attractive and, if you get three to five years use out of them, fine, but I wouldn't necessarily install them for the purpose of selling." says Mr Ensor.

A well-presented garden is another matter, however. Hiring a professional landscaper may not be necessary if you can do it yourself, says Simon Ensor, but the more impressive the garden the more saleable the house.

"A dog can create great wear and tear on a garden and it's good to resolve that problem before selling. Even rolling out a lawn can make a big difference. It can be off-putting for potential buyers to be confronted by a mud patch."

Some of the most transforming jobs involve more hard graft than hard cash. Stripping a house of dated wallpaper and painting walls in a light colour will increase it's desirability tenfold.

"A nice bright clean decor can create a huge impression but, if you do one room, you have to be ready for the knock-on effect. You can't just get rid of the hideous wallpaper in the hall and do a paint job and leave it at that because it will be in stark contrast to the rest of the house. You need to factor into your budget the cost of doing the whole house if necessary."

A good kitchen and bathroom are also major plus points.

Before ripping out the bathroom suite, ask yourself if it can be salvaged and given a new lease of life with sparkling new taps or new wall and floor tiling.

The right fireplace can make a vast difference. "Wonderful period fireplaces enhance a property's appeal but a 1930s tiled fireplace won't. In that situation it is not dramatically expensive to put in two nice tasteful sandstone fireplaces."

Pouring money into a house is useless if the resulting work is shoddy. You should only attempt DIY if you know what you are doing and it's wise to ensure the tradesman you hire comes highly recommended.

It is also important not to alienate your target buyer when you redecorate.

If you've bought a house that is popular with families, bear this in mind before you splurge on a minimalist glass basin perched atop a plank of wood for your bathroom - which might be the preferred bathroom sink of the young professional, but may be totally impractical for a family.

Likewise, a country-style kitchen could be the ultimate turn off in an apartment geared towards a young professional.

Keeping it simple and classic is a good rule of thumb. High fashion fixtures and fittings are risky because they can date. Remember when the avocado bathroom suite was all the rage?

Converting a four-bed house into a three-bed with an en suite is a costly mistake. Sacrificing a bedroom is never a good idea unless you live in a mansion or a stately pile and have a few to spare.

Whether or not to install a swimming-pool may not be the uppermost concern of most homeowners but, if you are one of the lucky few grappling with this dilemma, think twice.

"They come at a significant cost and I don't think they add significant value. Tennis courts, on the other hand, do. They carry no security risk and are not high maintenance," says Simon Ensor.