Popular French Property Draws International Buyers
News Posted On: 02 February 2015
Favourable foreign exchange rates are just part of the package that’s drawing UK buyers back to France. The weight of tradition, accessibility, and the attractiveness of a range of French destinations are all playing their part. When they step of the plane clutching their euros, though, overseas buyers find themselves competing in an international market dominated by American, Australian and Far Eastern buyers, especially in France’s traditionally popular regions.
UK buyers are in the best position they’ve been in for years to buy French property. Rising UK house prices are providing equity, which in turn translates into a little extra thanks to the exchange rate, and there’s something of a buyer’s market going on over there too. All these factors can add up to something like 30% off the prices of just a few years ago – enough to push many would-be émigrés and maybe-second-homers into action.
However, France’s most popular regions are also he sites of very fierce competition from buyers who are acting under the same forces. Australia and the US both have rising house prices, and strong currencies compared with the euro. Factor in wide regional price differences across France, and it’s clear that ‘now’s the time to grab a bargain!’ is only half the story.
That’s particularly the case in the South of the country where the Mediterranean climate and lifestyle factors have always conspired to produce a strong market.
Guy Hibbert, managing director of property firm FrenchEntrée, says: ‘Many of our UK and overseas clients have managed to secure some price reductions on French property in 2014. Much of this has been down to a combination of France’s well-publicised economic issues, global financial trends, and sustained increases in UK house prices.’ However, Mr Hibbert warned: ‘This has created the impression buyers can effectively continue to negotiate similar price reductions going into 2015, with buyers holding the upper hand. While this can be true of some regions, there is a two-tier property market in France.’
The picture is further complicated by people’s mix of reasons for moving to France. Broadly speaking, UK buyers are split in half between those who plan to spend the majority of the year in France and second or holiday home buyers. While the vast majority of those seeking to move to France full-time are at or near the age of retirement, a third of these still need to run a business or generate an income, meaning that their choice of location is further constrained. Properties that lend themselves to business applications run more expensive across both of France’s ‘two tiers’ of housing market too, typically costing an extra hundred thousand pounds.
Mr Hibbert concludes that while ‘the market for French homes is becoming more buoyant, complex and more competitive than the native French market,’ buyers also need to be aware that: ‘Foreign buyers looking to buy in enduringly popular regions such as the Dordogne and Cote d’Azur will still be required to pay a premium over native market rates for picturesque rural period properties.’
Written by Les Calvert of www.property-abroad.com - overseas property reporter
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