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French property market 'dead' - 14 May 2007

Not really, but an innovative and slightly strange system dating back centuries could be the best way for you to find that dream cottage, crammed full of authentic features, and in that sleepy village where you thought prices had got beyond your reach.

With increasing numbers of people looking for renovation properties in France, buying a property en viager has grown significantly in popularity. This process, as reported in the Observer, involves making a one-off payment (called a bouquet) and then paying the current occupant a monthly ‘rent’ until they die – when the property transfers to you, regardless of wills and taxes.

Despite the slightly morbid nature of the transaction, this is an ideal solution for those people looking for that perfect cottage, and allows elderly homeowners to release equity in their property without having to leave their home. This method was used in over 7,000 transactions last year, up from 5,000 three years ago. There is now even an agency specialising in this type of sale, Renee Costes Viager.

The process is somewhat strange, as the sellers, known as 'heads', advertise not only their property, but also their age, the bouquet, the rent, and whether the property is free or occupied, which is all part of a complex equation of elements calculated by the notaire.

While this method of buying means that properties are often available at low rates – there is currently one sea-view studio apartment in the Cote d’Azur town of St. Raphael available for €30,000 – you may have to wait some time to take possession of your new abode. At the same time, buying this way protects your investment from market rises in the future, and you could be moving into a property that is worth significantly more than it was when you bought it.

One note of caution though, with the tale of François Raffary, who bought an apartment en viager in 1965 from a 90-year old smoker. Thirty years later, when Raffary unfortunately passed away, his widow was left to continue paying the rent to Madame Calmet for a further two years, as she reached the ripe old age of 122.

 

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