France is the UKs closest neighbour and is home to almost 160,000 Brits. It has wide appeal because it offers such variety. There are gorgeous beaches, striking medieval towns and unrivalled mountain ranges ideal for skiing and snowboarding lovers. The cost of living is cheaper than the UK too.
The residential property market in France got back on track in 2017 with sales volume reaching a record high of 958,000 in the 12 months to October, some 15.6% above the previous year’s level. First time buyers returned to the market and prices have also been rising strongly, up 3.9% in the first three quarters of 2017. This level of activity is a result of three factors: persistently low interest rates, a recovering economy and a bounce in potential buyers.
Foreign direct investment flows to France increased by 77% (from USD 28 billion to approximately 50 billion) last year, making it the world’s 9th top economy in term of FDI Inflows. Foreign purchases accounted for 30% of French real estate activity last year.
Luxury property transactions in the capital increased year-on-year by almost a third, and the return of a particular non-resident demographic also helped the market have its best year since before the Eurozone crisis.
Some key facts
- House prices Up 2.9% in 2017
- FDI Rose 77% in 2017 – 9th Globally (30% of purchases by foreign investors)
- Economy: Very strong domestic market
- Interest rates: Record low rates
- Lending: Europe’s largest country for lending
- Regular flights: Yes
- Open all year round: Yes
- Ex- Pat communities: Yes
- Attractions: Beaches, country living and ski resorts
- Climate: Coastal areas have mild Winters and hot Summers. Generally France has cold Winters and mild Summers
- Primary languages: French
- Purchase costs: Average when commission included in price
- Taxes: Low/Medium
Why Buy in France?
France is one of the most popular destinations to buy and invest in property as it offers such a diverse range of property types and locations. It appeals to those wanting to buy a winter ski chalet in the French Alps, those wanting to live a life of luxury in a villa in Cannes, city lovers who dream of living in a city apartment in cosmopolitan Paris or those wanting a country retreat or vineyard business in Brittany. France offers something for everyone.
The most popular place for Brits to buy is the Ile-de-France region (which includes the capital city Paris). Next, is Poitou-Charentes to the west. These regions get good weather whereas the eastern region gets lots of rain so is the least desirable area for Brits.
You don’t need to apply for a Visa to live in France if you are an EU national. Whilst the UK is still a member of the EU this is currently the case however be aware this may change once the Brexit process is complete.
Those non-EU citizens can apply for a short term visa that covers them up to 90 days which must then be renewed via the appropriate process. Permanent residency can be applied for by non-EU nationals after 5 years. They will also need a permit to work in France if they intend to do so. Long term visas are renewed every 10 years and grant residency in France. Residency does require an absence of no longer than 6 continuous months at a time.
Investors in France can enjoy a special tax structure for Capital Gains Tax whereby the rate you pay tapers down to zero over 22 years meaning the longer you own your property in France, the less tax you pay.
France is famous for lots of things: fine wine, laid-back attitudes and, ofcourse, Gites. Investing in a home or holiday home that has space to develop an annexe for paying customers has proven popular for Brits abroad with some building good businesses and paying for their new homes through holiday-rental income at no extra cost.
Lease back schemes are popular among new build developments around France, particularly in ski resorts. Investors looking for a holiday home or ski chalet to use several weeks a year can receive a guaranteed rent by leasing the remaining weeks to a management company. The property manager will then rent your property to holiday makers, paying you a fixed fee, even when its empty. Many investors feel lease backs are a great option for “free” accommodation when travelling abroad themselves and also for peace-of-mind that returns are fixed.
France does not offer a Golden Visa programme linked to property like many other EU countries. Instead, France seeks to stimulate economic growth from foreign investors by offering an Entrepreneur Visa to those investing substantial capital in early stage businesses in France. France is the world’s 9th largest honey pot for Foreign Direct Investment so, clearly, France has more to offer than Citizenship in return for property investments.