Friday, 24 May 2013 21:55

Buyers market in France

Written by  Clare Nessling

Interesting reading from French Property News, which reports that the prospect of owning a property across the Channel has become even more achievable.

It refers to figures released by FNAIM (French national real estate federation) which show that property sales in France fell by 25 per cent in 2012. For those keen to get a foot on the French property ladder in 2013, reduced prices combined with the historically low mortgage rates that are currently available, could provide a great opportunity.

The federation’s data shows that the regions of Brittany and Normandy have been the most affected, and that since March 2012, the number of sales calculated over the last 12 months has fallen by an average of 2 per cent each month compared with the previous 12 months.
Regions such as Rhône-Alpes are, however, bucking the downward trend in sales, with Alpine property proving popular with buyers, resulting in increased demand and sales. In Méribel, for example, the price per square metre has risen by 15.1 per cent over the past year.

This is echoed in the latest Rightmove Overseas search report which shows that winter snow destinations did well in December, with the French regions of the Rhône-Alpes and Haute-Savoie both increasing by over 30 per cent month-on-month.

French Property News says that many expect that the trend seen in the Alps is set to continue in 2013, although the consensus view is that prices will fall elsewhere in France. However, the rate at which they are expected do so varies. FNAIM predicts that prices will fall by 2 per cent in 2013, the IEIF (Institut de l’Epargne Immobilière et Foncière) suggests a drop of 3 per cent and Standard and Poor’s predicts 5 per cent. January’s French Market Report from the Notaires de France also supports the view that prices of both apartments and houses in the French provinces will fall, with a stabilisation of prices predicted for inner Paris.

France has become an increasingly attractive choice for second-home buyers, not least because of low interest rates, easy access from the UK, better weather, and good rental yields, but also now due to some great property prices because of the slower market, which means that there are many motivated vendors who are open to lower offers.  

France represents relative stability amid the global downturn and the eurozone debt crisis, due to its more stable property and mortgage markets.  

It also offers the widest range of finance options and best available rates in Europe for UK buyers. As it’s in a relatively secure situation, loan to value ratios are still high and it’s quite normal for clients to borrow up to 70 per cent of the value of a property with an interest-only mortgage and up to 85 per cent with a repayment mortgage. Mortgage rates currently start from just 2.30 per cent.

Published by CLARE NESSLING  Clare Nessling Blog

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