Buying a renovated Project!

[logan]

Hi Guys
We are interested in buying a renovation project as our second home. But if we decide that we want to sell when ever we want to do we have to pay the previous owners profit as well as capital gains tax which I understand is 15%. I read an article that a lady bought a house kept it for about 18 months and then wanted to sell because she needed a bigger property. I think the lady had to give the previous owners a percentage of her profit. Can any one help me with this.
Thanks

[bryant]

Hello Logan,
Well I have never heard of paying the previous owner anything from the sale of a property he has already profited on before. The CGT rule applies if you sell a second home within 15 years of purchase by a sliding scale ( 18months would probably qualify for the full 33.3%). You can only offset charges by producing French registered artisan's TVA invoices for any work or services you have had carried out - certainly no till receipts or your own estimations for DIY. I suggest you take advice from a French notaries on how a sale like this could affect you as it may pay to hold onto the property for a few more years and decrease the tax payable which is taken at souce when you sell. Remember a renovation project will be expensive depending on the amount of work involved and sometimes a new build or a slightly more expensive property in the beginning but with less to be spent on it can be better.
Thanks

[linda huff]

Hi,
I researched this question very carefully, and found that you are better of paying more for a renovated property than one that is cheap but needs a lot of work, unless of course you are a builder and can do the work yourself, reliable people are hard to find to do the work are notoriously unreliable and any estimate that you have in your mind for work needed can be doubled in reality. If you have more questions e-mail huffsinfrance@wanadoo.fr