Covering just eight streets, the 500 Lion houses of the old Peterborough estate are widely regarded as the most desirable homes in Fulham.

“Many families won’t look at anything else,” says Emma Stead of the estate agent FPDSavills. What they are willing to pay, however, depends on what has happened to the Lion houses — named after the miniature stone lion motif on each rooftop — since they were built in the late 19th century.

Most have been transformed through conversions, extensions and redecoration since they were built for west London’s lower middle classes, when they comprised only a ground floor, first floor and cellar, with three bedrooms, an inside lavatory and a kitchen. But what form that transformation has taken is crucial to their value now.

Three houses in one of the estate’s streets look similar from the outside — but their price tags differ significantly. No 4 Bowerdean Street has just sold for £795,000, another house is up for £985,000 and No 27 is on the market for £1.1m.

Why the difference? A tour of the highest-priced house with Stead, whose office is handling the sale of the three properties, provides a few clues — and lessons on what you should and shouldn’t do to your London property if you want to add to its value.

No 27 is a perfect example of how a Victorian house can be adapted to meet the needs of a modern family through extension and some prudent demolition of internal walls. It now has four bedrooms and two bathrooms, and the basement has been dug out to create a big playroom, flooded with natural light; while the attic was converted into two extra bedrooms. An ultra-modern bathroom, converted from an original bedroom, features mosaic tiles and his-and-hers hand basins.

In addition, walls between the original ground-floor rooms were knocked down to create a large, airy living room and an even larger dining kitchen, flooded with light from a rear glass extension that leads into the garden. The kitchen/dining area has also been extended out to the side across a narrow passageway. The cool splendour of the interior — all modern clean lines, stylish furnishings and soothing neutral colours — has also added value.

It’s a world away from No 4, a four-bedroom, two-bathroom Lion house in need of redecoration and further modernisation — which is reflected in its £795,000 price tag. Andrew Perry-Smith, 37, who works in corporate development, has just bought it and is determined to lift his property into No 27’s league.

He and wife Lucy, 40, an advertising executive, reckon they will need to spend £180,000 to do so — after January, when their first baby is expected. After that, Perry-Smith will start on the Formica-topped kitchen.

“We really wanted to live in this area,” he says. “We were looking for an unmodernised property because we could not afford £950,000 plus. And even if you can, you end up spending £30,000 decorating it to your own taste,” he says.

They intend to knock down the ground-floor interior walls to create a huge, light-flooded living/dining/ kitchen area. “I’ve never taken on anything as big as this,” says Perry-Smith. “All our last house needed was decorating. With this, you have to be willing to live with dust and mess for years to come.”

After the ground floor is finished, Perry-Smith intends to update the 23-year-old attic-bedroom conversion and eventually convert the basement, as yet untouched.

Stead says converting a basement is a homeowner’s biggest headache: “It can cost £150,000 and can take five or six months to complete. A loft conversion, meanwhile, is around £50,000 and can be completed in eight weeks.”

Jane Shively, 48, a mother of two teenage girls, who lives at the Lion house on the market for £985,000, agrees. She bought her four-bedroom, two-bathroom house in Bowerdean Street eight years ago, “when it was a wreck”, for £395,000, and although she has updated an already converted attic, she has not converted the basement, now home to two cats and the fridge-freezer.

“We knew we would get the money back on the attic,” she says. “But we figured it would cost at least £90,000 to convert the basement and we wouldn’t get back what we spent.” Although she fully expects to get back far more than she has spent when she comes to sell, Shively has a word of warning for anybody buying unmodernised property. “Everything costs more than you think,” she says. “Everything goes over budget. We spent £3,000 on the wooden kitchen floor alone.”

Only time will tell whether Perry-Smith’s strategy of buying unmodernised pays off. But he has learnt some lessons — converting a loft adds more value than transforming the basement. Creating larger, light-filled, living spaces by demolishing internal walls on the ground floor also boosts value. “It suits modern taste,” explains Stead. “People like light.” And at least two bathrooms are becoming de rigueur.

FPDSavills, 0207 731 9400, www.fpdsavills.co.uk

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