France’s Property Market offers Cheaper Alternatives
TheMoveChannel.com, the leading international property portal, announces a number of new bargain France properties for sale
[UKPRwire, Tue Sep 30 2008] TheMoveChannel.com, the leading international property portal, announces a number of new bargain France properties for sale, including:
- Spacious Village house (£147,290, 3 beds, courtyard, Languedoc-Rousillon)
- High quality apartment (from £82,000, 1 bed, Rhone-Alps, fantastic skiing)
Properties in France may not be an investment opportunity UK investors have considered of late due to the credit crunch. One factor may be the increase of purchases by non-residents, with a particular presence of foreign buyers in the South East region of the country.
The British continue to remain the largest buyers of French property, accounting for around 60% of all foreign purchasers. The Russians are now also buying in France, although tending to target more extravagant properties in the South East.
For years now, France has been one of the countries with the most vibrant housing markets in the EU. Substantial house price increases have been going on since 1998 (only Ireland has experienced a longer period of growth).
Property prices in France tend to become more expensive the more urbanised the location, although prices can vary. Apartment prices in Paris (the fourth most expensive city in the world) average €10,485 per m2, whereas small rural properties go for about half that price.
So, it’s no wonder that France has become such a magnet for international property investors, with not just Brits but investors from Italy, Spain and Scandinavia, all buying into a small piece of Gallic charm.
The property rental market in France is vibrant and investors have a variety of options when it comes to making rental revenue and seeking out a bargain deal.
Leaseback (Residence de Tourisme) – This is an increasingly familiar way of buying French property for overseas buyers. In this scheme you buy the freehold but then lease it back to a company for a period of time, usually nine years, who then let it out on your behalf. This system can give guaranteed returns, normally between 3 and 6%, and the buyer also gets refunded the VAT on the purchase cost.
Buy to let - Long term leases in France are for three, six or nine year periods. Short holiday letting can be very rewarding, but obviously takes more effort to manage. This will be reflected in higher rental agency fees and there is more of a risk of void or empty periods.
Obtaining a French property is relatively simple, especially for EU citizens. A notary is required in order to draw up and then witness the signing of the contract, and with the notary in France being extremely revered, they will also be suitable to undertake the full legal service.
A deposit will be paid of around 10% on the day of the signing. Sometimes the deposit is less for properties under five years old.
French lenders are notoriously cautious and will put your finances under the microscope. But there has been a slight change in attitude, due partly to the demand for more flexible lending by British buyers, with interest-only mortgages recently made available.
Mortgage terms have lengthened over the past few years, suggesting that buyers are having some difficulty meeting interest and repayment obligations. The average mortgage term now stands at 20.5 years, according to FNAIM (the French Association of Estate Agents).
The European Central Bank has continuously raised base rates but the French housing market is somewhat less affected than other countries’ by such interest-rate rises, as only 20% of its housing loans are lent at variable rates.
Dan Johnson, Managing Director, comments:
“France is still a firm favourite as a property hotspot, which is no surprise as the country has so much to offer. It’s easily accessible, with first-class transport links and travel locations. It has an amazing countryside, superb ski resorts, breathtaking coastline, and a legendary capital city. All of which makes France… le magnifique.”
For more information on France property in general please visit http://france.themovechannel.com/
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Notes to editors:
TheMoveChannel.com is a property website that was founded in 1999 as an online resource for buying, selling and learning about property. It now receives as many as 300,000 visits per month and advertises over 50,000 properties in nearly 90 countries, which are listed by over 500 partner organisations.
For further information as well as images and interview possibilities, please contact:
0207 952 7650