In these challenging economic times, it seems that investors are shying away from the emerging property markets we were hearing so much about a few years ago, and putting their trust in the more established destinations, especially those with history of providing good rental returns. And no more so than in France, where a well-chosen investment could generate a very attractive and secure return over the long term.
When it comes to a sound overseas property investment, France appears to be ticking all the boxes. At the time of writing, mortgage rates are at their lowest in more than 60 years, starting at just 2.1 per cent, and affordability has also been further boosted by a slower property market which has been pushing prices down. In addition, there’s the enduring appeal of easy access from the UK, better weather, and good rental yields. France also represents relative stability amid the global downturn and ongoing eurozone crisis.
It’s no wonder, therefore, that France has topped the Conti hot spots list for five years, and accounted for around 45 per cent of enquiries received last year.
Generally speaking, French property prices generally remain well under UK averages, with plenty to choose from within a budget. In terms of sales, transactions fell by 25 per cent during 2012. As such, there are many motivated vendors who are open to lower offers in the slower market, and this, together with low interest rates, could provide a great opportunity for people who have been holding back on their intended purchase.
The country really does offer the long term investor a wealth of opportunity. But anyone considering a property purchase there must take professional advice before committing to anything, and go through the same process that they’d follow if they were buying a property in the UK. This includes taking independent advice from an English-speaking lawyer and ensuring that an independent valuation of the property is carried out, even if it’s a cash purchase.
It also pays to be brave when it comes to negotiating price. Under current market conditions, people are keener to sell and therefore more likely to be receptive to offers lower than the asking price.
It appears that the Brits’ love affair with overseas property is alive and well, and that confidence is picking up. Rightmove Overseas reported record traffic in March, with 5.4 million searches performed on its website. Spain and France topped the list accounting for 27.3 per cent and 17.8 per cent of enquiries respectively.
According to the most recent Overseas Guides Company (OGC) quarterly Index, demand for information about buying overseas property was higher in the first quarter of 2013 than in any quarter during 2012. And there was a staggering 50 per cent increase on the same quarter last year and even a 20 per cent hike in enquiries between July and September 2012, typically the busiest quarter in any year. The company says that there’s been a very noticeable resurgence in interest in European destinations, particularly France and Spain, during the first three months of the year.