A Concise Introduction to Property Wealth
Compliments of The French Property Collection
The following simplified explanation on how to secure your place on the property investment ladder may appear to be just that, too simple.
However, the specifics of how you proceed to achieve that aim is supported by documentation that we can provide you which will explain in greater detail.
Many ‘schemes’ and plans on how to either climb the ‘property ladder’ or become a property ‘mogul’ are available on the market, but few if any provide guarantees of any substance especially with minimal financial investment. The French Property Collection is ‘EXCLUSIVELY’ offering our valued clients an exceptional opportunity to realise all of those goals.
Please review the following points of this opportunity:
- Freehold property
- 100% mortgage guaranteed
- One only payment required & returned with interest
- No monthly financial commitment
- Guaranteed income covers all outgoings incl. legal fees
- Multiple unit ownership if desired
- Outstanding 10 year return on investment
If this appears too good to be true, please contact us for further details
Buy To Let Investment in France
France, the country of wine, cuisine, perfume, fashion and the Eiffel Tower, also provides real estate investors with some excellent opportunities.
France’s wonderful, diverse and expansive countryside, food, wine, traditions and culture make it the number one tourist destination in the world. In 2005 the country saw 76 million overseas holiday makers (up 1.2% on 2004) and 9 out of 10 French holiday makers vacationed in their own country (French government figures). To support and develop this vital industry the French government encourages the building of new holiday residences by offering attractive tax incentives for investors.
So why invest in off-plan real estate in France?
France is a geographically diverse nation offering property investors almost an unparalleled wealth of opportunity right across the country; Furthermore French property is still largely affordable with only the most popular towns in the most popular regions having reached heady heights in terms of property prices.
There is an added incentive for property investors looking at opportunities in France also; The French government are keen to attract foreign interest in property in France as a way of bringing in investment on the one hand, and as a way of creating desirable holiday property on the other hand. The government wants to do this to attract greater numbers of tourists to sample the delights of France and to raise the amount of overseas money that the French economy benefits from annually.
Quite simply, France needs new property. There is a demand for two types; Residential property for those wanting to rent a home, and holiday accommodation to support and bolster France’s thriving tourist industry.
Most French real estate professionals agree that the country will need 1 million new homes by 2030. The reasons include a high divorce rate in France leading to split families, a relatively high birth rate by European standards and a growing elderly population holding onto their homes.
According to magazine Le Point, only 58% of French own their home, against for example 84% in Spain and 71% in Britain. France also has a high student population and some cities, such as Toulouse with over 100 000 students, are desperate for apartments students can rent. So the opportunities for buying to let are clear.
Buy to let real estate for residential use is available in all sizes, from studios to 4 bedroom villas (although more usually apartments).
The properties are managed by a management company on a 3 year renewable lease.
After this time owners can elect to use the property themselves or sell it. The management company is contracted to maintain the property, find the tenants and guarantee a return, usually 3 - 5%.
There are a range of insurances available that enable the rent to be paid whether the property is rented or not.
Buy to let real estate is available all over France; in city and town centers, in the suburbs, in villages, anywhere in fact the developers believe the demand exists. If bought in the right location buy to let real estate can bring a secure return and appreciate in value.
France is a nation that not only welcomes some of the highest numbers of international visitors annually, it is also a country in which many expatriates choose to live or retire, this constant flow of inward migration results in a strong demand for property for sale across France which means investors buying to renovate and resell have an active potential resale market to tap into as well.
A property investor considering France has many regions to choose from and each offers a range of alternatives - an investor could choose buy to let opportunities in cities such as Paris or Orleans and tap into the professional rental market and corporate letting side of things, alternatively there are many universities and higher education facilities in towns across France that have students who seek affordable rental accommodation and who offer an investor another market to target. Then of course there is the vast holiday market demanding everything from beachfront apartments in the South of France to rural farmhouses with swimming pools in the French interior or close to the Northern ports that connect France to the UK.
The key to making a successful investment in France is identifying the target market and researching their requirements because everyone wants something different from property in France - for example an investor hoping to attract the family tourism market who fails to invest in property that is both affordably accessible and within easy reach of good amenities will fail to generate a decent yield.
France is a good solid, stable and consistent market, it is a safer market than many emerging nations for example, it has a constant supply of demand and the best thing is that the government welcomes investors.
Buy to Let is self explanatory
This is a classic freehold property purchase and once you have purchased the property you can lease the property to a permanent tenant and a property management company will look after your interests and will pay you an income on a monthly basis.
- The property is let out to permanent residents as opposed to holiday-makers for leaseback properties.
- No free weeks or personal usage during the lease term, but it is possible to live in the property for unlimited time once the lease terminates.
- No furniture to buy, the apartments are let unfurnished.
- Very flexible terms compared to lease-backs, with the possibility to break the contract with the management company at anytime.
- Prices do not include VAT, so no VAT will be re paid to the investor like in leasebacks.
- New builds offer more choice of properties compared to lease-backs.
- The properties are both new and pre-owned and are located in areas offering both strong capital appreciation and good rental returns.
The Lease period :
The lease period is normally three years. Once you sign a lease with a tenant you have virtually no chance of recovering the apartment for personal usage unless through severe professional or family problems which have to be verified.
The Rental Return:
The average gross rental yield on a buy to let opportunity is 4-5% before costs on extra guarantees. This can change from area to area.
What if I want to sell my property?
As you own your property outright, you can sell, with the tenant still in place or at vacant possession, at the end of the lease term by providing the required notice in writing. If you sell the property with a tenant still in place you will not receive full market value as your buyer will have to be an investor like yourself.
Why Invest in France?
As an investor the Major factors when choosing an investment are Price, Location, Rental Income (Returns on investment) and long term Re Sale Potential and France has it all.
The French Market:
The French market is now providing great opportunities of capital growth as France has not benefited like other European Countries in the recent explosion of the prices in housing market.
Although the housing market in France has grown in the last few years (on average 15% per year) property prices in certain areas of France have only returned to 1991 levels especially Paris.
France’s economy is improving. Banking regulations are changing and equity releases on global assets has not hit France yet (when they do property prices will rise).
Most factors to consider when thinking of investing in France is its infrastructure.
Compared to other emerging countries, in terms of rail, road, airports and future projects including high speed trains etc. France is one of the most advanced countries in Europe.
Why the French market is rising:
Interest rates are at an all time low and more and more French are purchasing property as before they used to rent.
The French are benefiting from the duration of loans that the banks are proposing, as the average loan period is 25 years compared to 15 years in 2002. (the longer the loan period the cheaper the monthly payment so why rent).
Impact of investment by foreign nationals; ( 13 % of property investments in France are made through foreign nationals and the trend is continuing ).
Advantages of the French System:
France has a solid banking structure, a tax system that favours investment in property and is the Number 1 country of investment by foreign nationals for the last five years!
Its notary system is unique as the Notaire (solicitor appointed by the government) works for both parties during the sale and as a buyer your interests are seriously observed and no surprises are guaranteed!
Its real estate and construction industry are highly regulated comparative to certain emerging countries! If you need information (Prices, Future developments etc) in an area that you are thinking of buying contact us below for a professional opinion.
Buy to Let Rental Guarantee
Why take out guarantees on the risk of unpaid rent:
Good property management is necessary to cover yourself from the risk of losses from unpaid rent. In the renting business the one big problem is that of unpaid rents because your tenant could fall to an accident at work or in his leisure hours with a disastrous effect on his ability to keep up with rental payments. Also as you will be abroad it is better having peace of mind for a small premium on your rental income.
Guarantees for buy to let opportunities available. Certain guarantees are offered by most property management companies.
They are as follows:
1. A guarantee against unpaid rent and damage caused to the property.
The management company will settle the rent on behalf of the tenant, in case he fails to pay his rent. This includes service charges.
The management company will pay for any damage caused by the tenant and will proceed to all the repairs: plumbing, electricity, tiling, painting, masonry.
2. Guarantee of non occupation.
If the property becomes vacant, the management company will still guarantee you the rent.
What does ‘Guaranteed Rental’ mean?
You are guaranteed a gross rental yield by a reputable Management Company: the risk being underwritten by a major French Insurance Company or Bank.
Non Contractual Document