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The top ten places to buy leaseback property in France
No doubt, if you are considering buying property in France, you will at some point have heard the term, "leaseback". You may even have a hazy idea of what it means, but to make a decision on whether or not this type of purchase is for you, you need to understand firstly what a leaseback scheme entails, and secondly how to make a French leaseback purchase a good investment rather than a millstone around your neck.
In brief, a leaseback scheme enables you to make a real property investment that you may not have been able to afford otherwise. You purchase the property, often with a deposit of as little as five percent (it is quite possible to arrange a mortgage for this type of purchase too, so don't worry if you need to do this) on the condition that you will lease the property back to the developer (if the property is new) or to the letting agent in the case of an older property. The initial leaseback period (which is obligatory) is usually nine years, but you do get an agreed period of time in which the property is at your disposal for holidays. The developer or letting agent will then rent out the property for the remainder of the time, paying a guaranteed fixed income to you. (For a more detailed explanation of French leaseback and property please see Leaseback Property in France.)
If you are looking to make a real investment in France as opposed to buying yourself cheap holidays, then it's leaseback every time. In time-share, you only ever own a percentage of the property, a right to use. With leaseback property, however, you own the freehold, so as a long term investment a leaseback property can be an excellent pension scheme! One thing to be aware of, though, is that with a leaseback agreement, although you are technically entitled to sell the property or cancel the leaseback agreement at any time after the end of the initial nine year period, you may have to pay compensation to the letting agent, as he or she owns the right to choose whether or not to continue the agreement at this point.
Typically, a French property that is sold through a leaseback scheme will be new, or even not yet built and bought off plan. It will be of a high standard of construction, furnished to a high standard, frequently in a complex with facilities such as gyms, swimming pools and tennis courts.
No... leaseback property relies on a high take up of holiday lettings, therefore you won't find a leaseback option on a little cottage in the middle of nowhere, or on a cheap and cheerful town house in an unremarkable town. The scheme actually originated in a government drive to boost tourism, so this is the driving force behind leaseback property. If you want to know what type of property is likely to be available as a leaseback property, look at the holiday brochures... if it's a property type that is popular for holidays then it could well be a leaseback proposition!
A French leaseback property needs to be in a location that is perennially popular. It needs to attract tourists for as much of the year as possible, and to attract both French and foreign tourists. If you have decided that a leaseback scheme is a good idea for you, it is important to chose the best location for the purchase, as this will not only affect the long term value of your investment, but also your personal enjoyment of your allotted times in the property! Below is a list of ten regions of France where you might find a leaseback possibility, and reasons why it could be the ideal place for you. They are listed in no particular order, as the best region for one person may not be the best for the next! See them for what they are, then make your choice...
The popularity of the French Alps as a tourist destination in both winter and summer make them a prime location for leaseback property (Alps property). The Alps also lend themselves well to leaseback arrangements due to the types of property available here, with modern apartment blocks and chalet style accommodation on close knit developments. If you are a keen skier and want to own a property in one of the most desirable ski areas of the world, then a leaseback property here will guarantee you not only fantastic skiing holidays for many years, but also should prove a good investment. (Ski Chalets for Sale in France.)
Seek out property in the best known and well loved areas like Tignes (the closet thing to all round skiing in France) or Val d'Isère (Val d'Isère Property Guide). Megève (Megève Property Guide) is another good bet, as it retains its popularity year after year. Then there is Les Arcs (Les Arcs Property Guide), Chamonix (Chamonix Property Guide), and any of the other major resorts where the leaseback concept is big news. The Alps are perfectly suited to leaseback schemes, so if this is your dream region don't miss out.
The French Riviera (French Riviera Property - an insider's guide) is one of Europe's longest standing favourite holiday spots, and also proves an excellent location for leaseback property. Properties here tend to include luxury apartments (Apartments and flats in France) and studios close to the beaches and action of the French Riviera towns, and the fact that they are expensive means that there will be a real call for leaseback schemes amongst people who are keen to buy quality property here but could not afford to do so under ordinary circumstances. Property in the French Riviera is still increasing in value making it another good investment in the long term. (Property in the south of France.)
The best places in the French Riviera? Anywhere really, it's a small area and everywhere is desirable. It's hard to make a bad call here. You can't go wrong with Nice (Nice Property Guide) though...or Cannes (Cannes Property Guide).
Everybody wants a piece of Paris (Paris Property Guide), few can afford luxury property in the best areas. Here you can have your cake and eat it, as long as you are prepared to accept the terms of a leaseback property, and to raise the finance in the first place. Paris is so popular with tourists from all over the world, not to mention the French, that you simply can't lose as long as you choose a good area. Property offered for leaseback sale is usually carefully researched and well sited anyway, so you should be backing a winner with this one! Don't forget, you can use leaseback to finance a business property purchase too, and locations close to the capital with good road and rail links are ideal for this (French Connections -Travel to Paris and North-East France). An apartment block, if you have the necessary cash, within reach of Paris would make a fantastic investment.
Areas to consider include anywhere in the suburbs or the commercial districts close enough to Paris for daily travel. If you want to be within the city limits, then try the 13th arrondissement, a residential and commercial area which is really up and coming... or consider the 10th arrondissement, Enclos-St-Laurent, which has excellent transport connections provided by Gard du Nord and Gare de l'Est and is another area being regenerated. True Paris aficionados may prefer to be right in the heart of Parisian Bohemian life, in the 18th arrondissement (Paris Butte-Montmartre (arrondissement 18) Property Guide), where there are currently a few rare chances to purchase a leaseback apartment. Expect these properties to sell quickly though, as such apartments in the heart of these areas of the capital create huge interest.
If you are considering a leaseback property then think a little outside the box and consider Corsica. The French paradise island, Corsica is the perfect location for exotic holidays without having to travel far. Lying just off the south coast of France, this Mediterranean jewel of an island makes a fabulous location for leaseback property. If you buy in Corsica, not only should you stand to make a considerable amount of money from the eventual sale of the property, but you will own a very desirable holiday home where you can spend sun blessed holidays for years to come.
Who doesn't want a property in Provence (Provence-Alpes-Côte d'Azur Property Guide)? Once you have read Peter Mayle's evocative account of a year lived in rural Provence, you cannot help but want to live this particular dream. The trouble is, a lot of people have read the book, and a lot of people have already bought into this particular dream, pushing prices up and making it difficult for ordinary mortals to own their little piece of this lovely land. The solution could just lie in a leaseback property, enabling you to buy at the necessary prices of the region but to pay off most of the initial costs through the guaranteed rental income that is a standard part of a leaseback agreement. In the Alpes de Haute Provence (Alpes de Haute Provence Property Guide), for example you can purchase leaseback apartments developed from an authentic old Provençal farm, offering a true taste of Provençal country life, à la Monsieur Mayle!
The Languedoc, or to give its full title, Languedoc-Roussillon (Languedoc-Roussillon Property Guide), is known as the region where property prices have experienced the greatest rises in the shortest period of time. Not only is it the place to invest in terms of financial benefits, but also it is a great place for a leaseback property in France, as it is becoming increasingly popular with tourists too. It isn't even only the Mediterranean coast that is the draw here, either, as current interest in the Da Vinci code and other Grail and Cathar mysteries have created a whole new tourist trade for the region. (Languedoc Property - Top 10, Languedoc-Roussillon Property - an insider's guide.)
Areas to look in include Carcassonne (Carcassonne Property Guide), the beautiful Cathar city of the Aude (Aude Property Guide), the popular coastal resort of Narbonne (Narbonne Property Guide), the wine and history rich department of the Hérault (Hérault Property Guide), and the sublimely beautiful fishing towns found in the Pyrénées-Orientales (Pyrénées-Orientales Property Guide) down near the Spanish border.
The French Pyrénées are another area to watch carefully, if you are looking to invest in an up and coming region. Ski resorts such as Cauterets (Cauterets Property Guide), in the western Pyrénées, are gradually receiving more media exposure and as such are becoming more and more desirable to tourists... and hence to property investors! The Pyrénées in general are gaining in popularity as both tourists and investors look to find alternatives to the tried and tested (but busy and expensive) French Alps. Skiers who try the Pyrénées for a change from the Alpine resorts are often pleasantly surprised, and return delighted by the vastly reduced queues for the lifts, the friendliness and accessibility of the resort staff, and the enthusiasm of the locals who are keen to promote the attractions of their area.
This is an interesting area in terms of popularity on the French property scene, and a relative newcomer when it comes to leaseback property developments. The region is steadily becoming more and more sought after, however, and is proving extremely popular with British holiday makers who love the wide open spaces and sheer "Frenchness" of the countryside of the Gers (Gers Property Guide) and the Tarn (Tarn Property Guide) in particular. Then of course, there are the great towns and cities of the region (Midi-Pyrénées Property Guide) that make it even more desirable.
The region has some superb traditional grand houses, authentic water mills, farms and other country style residences that lend themselves well to development into leaseback apartments. It's the perfect location if you fancy spending your holidays in the sunny peace and quiet of the southern countryside, and prices are lower than in the better known regions too, so it should prove a wise investment.
A bit of surprise contender, this one, but it is always good to be in on a little secret. This region (Picardy Property Guide) is improving massively, and as such is a prime contender for exciting new developments such as leaseback initiatives. Areas to look for include the Somme Bay, where the area is rich in natural beauty and which has an ever growing band of loyal holidaymakers. There is a development here which is deeply unusual, in that it has been created in partnership with the World Wildlife Fund, and is ecologically sound in every way. This is a place to consider if you are environmentally conscientious, want to invest wisely and connect with like minded people too!
OK, so the final best area of France in which to purchase a leaseback property isn't an area as such... or even a region or a particular town. It is, however, a very exciting idea for anyone who wants to have their finger on the pulse of the French property market, and who wants to be a step ahead of the game. The place to buy a leaseback property is... anywhere there is a golf development. Golf is becoming the buzz word in France for increasing touristic income, and new courses and related developments, almost inevitably of a very luxurious standard, are springing up all over France. The realisation that the sport is massively popular among foreign tourists, particularly the British and Americans, is fast dawning on the French, and anyone who can is looking to make the most of this new possibility. Golf might be old news in Britain, but it is a real hot trend in France. (Property Near Golf Courses in France.)
Golf complexes and leaseback property can be found in any part of France, with the Centre Val de Loire (The Central Loire Valley Property Guide) and the Roussillon areas of Languedoc-Roussillon being among the first and best to capitalise on this new trend.
As the French are always saying. A French leaseback property then may not suit everyone, but it is certainly worth considering. Take good financial advice, keep an eye on the latest trends and developments in the French property market, and you could be onto a winner.
Additional articles which may be of interest:
Letting property in France
New build property in France
Tax in France
Joanna Simm moved to the Languedoc area of south-west France in October 2004 having found her property through French Property Links.
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