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France presses investment case - 17 August 2007

The traditional image we all have of buying a property in France is that of a quiet countryside cottage in need of gentle renovation while sipping local red wine and gazing out over the views.

However, the number of overseas buyers who are now buying new-build properties in the cities and major resort areas is increasing, and with a recent political change, the case for investing in Gallic property is even stronger. Leaseback property, and in particular, property to rent out to local residents.

The fledgling presidency of Nicolas Sarkozy is championing property ownership among the population, and estimates are that to cope with demand something like 500,000 properties need to be built annually. Industry insiders suggest that this figure is not likely to be met, and the figure does not include properties required by overseas purchasers.

This makes it an ideal time to buy property in those regions where there is a shortage of high-quality family housing to cater for the needs of local workers. In areas like Perpignan, where the city centre is easily commutable from the residential suburbs, buyers could get in early and rent out their property on a 12-month contract. On top of this, the capital appreciation in areas where housing stock is scarce will be impressive, and there will be no issues selling the property on, possibly also to the local market.

In recent years, the South West of France has posted some impressive growth figures, with between 10 and 15 per cent annual increase regularly attained.

 

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