Property investors have long been attracted to France as their first port of call when buying property overseas. But what makes France such a popular property investment location and how can you make the most of buying French property for your own investment goals?
Buy property in France to diversify your assets and currencies
Wise investors know that steering clear of putting all of your eggs in one basket is more than just an old wives’ proverb. As far as buying property is concerned, that could mean choosing investment properties in different geographic markets. More markets means more flexibility and more opportunities to make the most of your investment. When buying property in France, the exchange rate may also play in your favour. While the price of the pound has dropped slightly against the euro in the first quarter of 2016 following a very strong performance in 2015, it is still trading at a favourable rate. This means that buying property in France as a foreigner puts you in the ideal position to get more for your money than you might do at home.
The advantages of buying property in France
The holiday market in France is nothing new, which is good news for property investors on two fronts. Firstly, as a popular tourist destination, demand for rental properties has already been demonstrated and is unlikely to disappear in the foreseeable future. Secondly, the overseas property investment market itself is well developed, meaning there’s a wealth of available knowledge and secure investment programmes in place. There are also specific financial incentives for investors looking to buy property in France. For example, the government-backed leaseback scheme allows investors to receive a guaranteed rental income, usually of around 2% to 5% of their property value. In addition, leaseback buyers can receive a refund on VAT. Meanwhile, the double tax treaty introduced between the UK and France back in 2009 ensures that any taxes associated with your property will only be paid once.
Choosing the right location to buy French property
For most overseas property investors in France, the key is not trying to reinvent the wheel, especially for a first-time investment. This usually means choosing locations that are already well-known tourist destinations and have a solid track record. In France, this includes the big cities, ski resorts in the mountains or locations within reach of good beaches along the coast. It is only natural that these kinds of locations are likely to have a higher price tag than those in so-far undiscovered locations and this is often the stamp of a secure long-term investment. Nonetheless, there is still a reasonable range of property prices in appealing locations for those of all budgets looking to buy property in France. Alongside Paris, the French Riviera and the Alps top the list of pricier investment locations. However, places like Brittany and Aquitaine can also provide an intriguing investment prospect for a considerably lower price.
There’s more than one way to buy French property
Once you’ve made the decision to buy property in France, there are various options available for you to maximise your investment. While it is entirely possible to purchase your property outright and handle the legal and rental arrangements yourself, this does entail a significant amount of on-going involvement that can eat into other commitments. As an alternative, many investors choose established investment programmes with buy-to-let structures built into the purchase agreements. This can allow buyers to sidestep the more complex and risky elements of overseas investment as well as handing off time-consuming day-to-day issues.
With a variety of options on price, location and purchasing agreements, buying a property in France is a rewarding experience for a broad range of discerning investors.
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