| Investing
in French property can sometimes be a risky business. You
invest in a villa or a luxury French apartment and rely on
a combination of rental income and capital appreciation to
return you a profit. You do your French property research
and deduce that you need to make your real estate investment
in a location with strong rental demand.
The French Alps are perfect you think - tourists
to France hit the slopes with their skis in winter and climb
the slopes with their hiking boots in summer. The Cote d Azur
is great too, especially with Nice Airport being so close
to luxury investment spots like Cannes, Frejus and St Tropez.
All of these areas have great potential for
French property investments. Tenant occupation is likely to
be high and you can charge good rents too. The problem however
is that you still have to market your French property to tourists
visiting France and obtain bookings from them for the property.
If you've not got a solid marketing plan
behind you this aim can be very difficult indeed. I've known
property owners unable to rent out their luxury French home
for more than 2 months of the year in these sorts of areas,
all because they failed to get their property details in front
of potential customers.
Enter the French Property Leaseback Scheme
The French property leaseback scheme is an
investment initiative launched by the French government in
the 1970s. The impetus behind the leaseback scheme was to
attract investment in tourist areas to boost the French economy...and
it worked!
The basis of the leaseback system is in the
sale of French property on a sale and leaseback agreement,
mainly to foreign investors. The investor buys the freehold
property and as part of the deal leases the property back
to a tourist management company for a set period of time -
normally 8 to 11 years.
During this period the tourist management
company rents the property out to holidaymakers - this is
generally their speciality as they can guarantee occupation
for much of the year. In return, the investor-owner receives
a share of the rental income. This is a guaranteed income
that is geared to a specific rental yield percentage on the
property, and is index linked.
But what makes the French leaseback scheme
a safe investment? The answer is down to the French government.
The sale and leaseback scheme is strongly supported by France's
government. It has to be as it was their brainchild! Basically,
if you make an investment in sale and leaseback property in
France, you are guaranteed your rental return because of the
government's involvement.
Of course, as with every type of investment
that is considered 'safe', the returns are not tremendous.
Typical rental yields range between 2% and 5%, the higher
figure being awarded to the investor-owner if no personal
use of the leaseback property is required - i.e. the leaseback
property is purchased as a 'financial only' property. These
rental returns are certainly not going to set the world alight.
They do however provide you with a solid investment from which
you can count on a level of income that is guaranteed.
Where to buy your French leaseback property?
As mentioned already, top locations in which
to buy sale and leaseback property in France is in the popular
tourist areas. The French Alps offer innumerable opportunities
to buy French property in world class ski resorts on a leaseback
basis. Ski stations like Val d Isere in the Savoie region
of France are popular, as are ski resorts in the Three Valleys
area (Trois Vallees), which encompass the likes of Meribel,
les Menuries, Courchevel and Val Thorens.
If you are looking for luxury French leasebacks
one area to consider is Les Arcs 1950. Here there is a village
built by one of the leading leaseback developers in the world
- Intrawest France. They have created a magnificent collection
of buildings in one of the most picturesque places in Eastern
France. The architecture is in the Savoyard style, and the
leaseback apartments and chalets are built of traditional
French materials, including stone and wood.
Coastal holiday destinations in France are
hot investment locations too. In the South of France along
the French Riviera there are some excellent opportunities
to buy French property under the government-supported leaseback
scheme. Property prices are generally highest along the stretch
from St Tropez to Monaco. It's no coincidence that this stretch
is also the warmest and sunniest area of France!
Further west along the coast is the Languedoc-Roussillon
area. Tipped as the next investment hotspot in France by many
investment analysts, the Languedoc Roussillon has a laid-back
charm about it that is very different to the glitz and glamour
of the French Riviera. Top locations to consider for buying
a leaseback property are along the Cote Vermeille between
Perpignan and Banyuls-sur-Mer. This stretch of coast takes
in some very scenic villages and towns, St Cyprien and Collioure
among them.
Travelling west again we ascend up into the
Pyrenees Mountain range. Here again are some fantastic leaseback
investment opportunities, especially in the Pyrenees ski resorts
like La Mongie and Font Romeu. Leaseback property prices are
generally cheaper in the Pyrenees than the French Alps. If
you are planning to invest in French property on a budget,
the Pyrenees could be the region to consider.
Southwest France is always a favoured investment
location in France. For leaseback properties the same is true.
Leaseback developments inland in the Southwest are often cheaper
than along the coast. Places like Biarritz, Capbreton and
Arcachon in the Gironde offer magnificent Atlantic vistas
that are simply to die for.
Northern France is good for leaseback investment.
Okay, it doesn't have the best track record with the weather
in France, but its proximity to the shores of Great Britain
and Ireland make it a popular choice with investors who want
to buy French property as a holiday home that they can visit
for 2-4 weeks of a year, and then rent out on the leaseback
scheme for the remainder of the time. Brittany leasebacks
and Normandy leasebacks are especially popular. Leaseback
properties in Nord Pas de Calais excite some investors as
well.
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to let French property |
Herault
property in France |
Property
for sale in Paris |
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for sale in Languedoc-Roussillon
| France
investment property |
Property
to buy in France | Property
investment in France | Buying
Property In France |
French
Leaseback Properties are a Safe Investment |
French
Leasebacks as an Investment |
