Hello all, having visited most regions of France over the last twenty years we have decided to take the plunge and relocate over there. We have settled on a nice house on the outskirts of a hamlet in the Gironde. Our offer has been accepted and we have mutually agreed with the vendors to complete in May. Obviously we will be committed by way of having to pay a 10% deposit very soon. Our concern is what if as predicted property prices fall. Has anyone got any definitive predictions as to how the market looks to be going. I appreciate that no one has a crystal ball, its just that we find different predictions from different sources who may have a vested interest in their opinions.We know this is a lifestyle investment rather than like the UK where some see property as an investment. The overall thing is that this is our dream to live in France, we are just a bit nervous. Any information would be gratefully appreciated
Hi Chris,
You've obviously done your homework on location and adjoining users; but no mention of an independent survey to let you know about the current condition of the property. The statutory diagnostic reports fall a long way short of providing a comprehensive view of what you're committing to....an asset or a liability.
The French property market is considerably different to the UK's: in addition to the patrimonial attachment to their properties (and the inheritance laws!) the 'participation costs' in the market (fees, commissions, taxes etc...) make for an illiquid investment media; so don't regard your home as any kind of money-making opportunity. There are legal / tax vehicles which allow for property trading, but I'm assuming you intend to live in the house for the forseeable future, as your main residence.
Although Sterling is currently good against the Euro; making your purchase look better value than it might have done two years ago; proceed with caution; there is a good reason why French property (outside the 'hot spots') is priced as it is. And as others have said, approach the utterances of those with an interest in getting you signed-up to a contract with some circumspection...... caveat emptor! There is no 'subject to contract' wriggle-room here, unless you insist on a series of conditional clauses (clauses suspensive) in your initial contract - the Notaire can advise you further.
All the best, and hope you enjoy living here full time. John
My OH sells part-time. At present there is movement and sales, which there was not at this time last year. Prices are not going down any longer in this area, some have had offers close enough to each other for them to be called bids since in a couple of cases the houses, albeit it somewhat upmarket, prices have gone above the advertised price. As David says, some houses take forever to sell. She has a couple that are superb, one I know well because I know the people there, the other I have seen from outside only but also the sales blurb, so cannot understand why they are over and approaching two years on the market with two and three agencies respectively but have never yet had a single viewing. Five years and more is also not unusual. One house is now less than 50% of its original price. A well known hotel and restaurant that would once have been all but fought over has had one tentative show of interest but the people had to cancel because they could not get to Europe at present. Some of those places need almost no work done on them except what people would do in any house for their own taste and needs. Given the price of some of them at a guess the majority of people going for them would have plenty of money for their own renovations anyway. It is a mystery.
However, remember that even if prices are holding their own, that is not apace inflation around them. Therein lies the catch. Waiting to sell, possible economic crises and other circumstances dictate the risk and not whether enough has been invested as some people assume. Houses are sold on the basis of square metrage and land around them, which may include land use and other matters such as the rights of neighbours to use than land for agricultural purposes, rights of way or very practical things such as their water supply and sanitation, especially where sewerage is on mains, electricity and telephone cables or gas pipeline cross ones land which restricts what can be done to some extent.
Although I agree with much of what Simon says, from personal experience I would always advocate declaring everything you need to. If you don’t it will eventually come back and bite you.
have been looking for over two years now, it depends on the property but in the next five years I do not see the french rural property prices rising at all, prices have been reduced by the vendor by about 10% per annum.
but saying that some properties sell quickly then others just sit there doing nothing. what ever the vendor is selling the property for you can get a 15% discount easily plus they will also go halves with the estate agent fee. remember what ever you paid you still have to pay an additional 8% approx to the notaire for his fees and taxes. also the notaire will sign on your behalf so you do not a to travel over.
now comes the good part, what ever property you have bought expect to pay about €10k for upgrading the sewage system and another €10k for modernization. the french have a weird sense of decor especially the older generation where make do and mend was their attitude.
by the way never trust an estate agent they are there to flog a property and make their 20% profit, that is why they do not like doing too much for you. my advice is before signing get the agent to take more pictures, get details of the water and electricity companies and also get them to get in touch with the mairie to see if the property can be extended or modernised etc. let them do all the leg work.
once bought when you upgrade your taxes will now suddenly increase as you have modernised the property. an example is if you fit an en suite toilet and wash basin down stairs your property tax goes up by declaring the basin, if you do not declare the basin but only the wc there is no increase. Basically do as the french do and do not declare every thing, ie play dumb, and also ignore bad advice.
I could go on here for pages giving you advice but you will have to just trust your insticts.
Thanks David,appreciate your perspective. Its only a small place with about a quarter acre, certainly not a wine estate, I wish!! Its been for sale for 18 months and Legget have shown us that its been reduced. We're coming over in Feb to sign. Yes it has been our dream for many years. We are new to forums/blogs/tweeting etc and friends have told us we must properly introduce ourselves before making a post so apologies, will do.
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Hi Chris. I'm no property expert but looking at the regional newspaper here (Sud Ouest) I would say the following. Wine estates and their accompanying country houses are increasing in price. They're a fashion statement particularly for the Chinese. Sadly in many cases once bought they lose their attraction and the Chinese are developing a reputation for being absentee landlords who don't pay their workers. Property prices in Bordeaux itself have been increasing year on year and with the development of the super fast train will probably continue to grow.Out in the sticks in pleasant hamlets the prices remain much the same year on year and there is little capital growth when you factor in inflation. You say you are looking for the dream well maybe that's the way to look at it. Figure out how much you would be prepared to lose and how long you would be able to wait to sell the property should you decide to return to UK (have you asked the immobilierwhen the house was first marketed). Many properties take years to sell I can think of several "attractive " properties locally which have been on the market for more than five years. On the other hand there are many properties which will never sell to the UK buyers because they are allegedly too small and too urban but they are remarkably cheap although realistically you would probably have to spend almost as much again to bring them up to a reasonable standard for the UK buyer.The last also applies to many rural/hamlet houses.