Overseas property advice

New French property law no VAT

French real estate has become even more attractive with recent changes in the way French Leaseback property is taxed on its sale. Changes in French law now remove the necessity to pay VAT on French Leaseback properties when they are sold making this type of French property an attractive overseas property investment.

The Leaseback System is a scheme which was introduced by the French government in 1976 to boost the tourist industry in different parts of France. The French government was concerned about the slow French housing market and a slow down in tourism in certain areas of France. The leaseback property buying system was introduced to counteract these problems. Leaseback developments were originally in the less popular areas of France but the scheme has greatly expanded since those days

Before the introduction of the new French property law, the payment of VAT on the new property - currently 19.6% - was waived but, if the property was sold prior to completion of the 11-year term, the vendor was obliged to pay a proportion of the VAT back to the state. The investor is no longer required to repay any VAT at all when selling the apartment, even if he or she re-sells within the first five years of ownership. The only condition is that the residence must be ‘classified’ with an official tourism star rating

The French property market was brought into the fore by allegations of greed and advantageous property deals as Ségolène Royal was accused of underestimating the value of her French Riviera holiday home to minimise her tax bill.

Ms Royal the first woman with a chance of becoming French president faced down the charges, saying she had been "transparent" over her property portfolio. The tax authorities would have intervened if there were grounds for concern, she said

Property in France

French real estate

Languedoc-Roussillon attracting international French property buyers

The Languedoc-Roussillon region of France has been named the top region for the strongest growth in the French property market . Languedoc-Roussillon is located in Southern France and stretches along the Mediterranean to provide a warm climate and beautiful coastal scenery.

The associated body of real estate agencies in the country (FNAIM) named the Languedoc as the top region for, long term growth, with figures showing the region enjoying 10.3% growth in house prices for the first quarter of 2006, putting it far and away into the top spot for investment.

A survey by Abbey National also indicated that the Languedoc-Roussillon region was the most popular area for UK overseas property buyers.The survey revealed that the majority of these buyers were willing to invest between £50,000 and £150,000 in region's property.

Marr International Ltd the company behind the overseas property web site Homesgofast.com also reports a renewed interest in the area experiencing a 30% increases in overseas buyers requesting properties in the region, CEO Nicholas Marr states’ Despite all the emerging markets many buyers still see France as their dream place to live abroad. Languedoc-Roussillon offers value for money, a superb climate and benefits from good communications including several airports that cater for low cost airlines. Overseas property buyers love the combination of sandy beaches, countryside, medieval towns and of course the relaxed pace of life’

Freddy Rueda of Real Estate Languedoc.com who has been working in the region for over 10 years states ‘the region has seen arrival of new nationalities buying French property in Languedoc Roussillon region. We now have buyers from Singapore, Japan, Australia and South Africa. The traditional foreign buyers in the area, English, Irish, Scottish, Belgians, Dutch and Germans are also keeping the market strong. The climate has the French buying property here they tend to be relocating from Paris and the north of the country’ The strong annual growth, combined with a strong rental market, where a 4 bedroom villa with a pool rents for 1000 Euros plus in high season, makes this area an investor’s dream.

Re Buying a holiday home in France

Buying property in French

Kelly thanks for your question concerning which area in France would provide the following
1.) Reasonable house prices
2.) French countryside
3.) Typically French no loud tourist areas
4.) French property with character

French housing market

The conditions for overseas property investors are currently positive in France, with the country seeing its largest degree of growth since 2000 in the second quarter of this year.

The French economy, the second largest in the euro-zone, saw a GDP increase of 1.2 per cent between April and June this year, compared to 1.1 per cent in the first quarter of 2006.

In terms of particular areas of the French property market,  the region of Languedoc-Roussillon has seen its prices rise ten per cent a month .

I invite agents from the Region to expand on my answer. 

For a selection of French property go here