Sterling is 20 percent stronger against the euro in the last few weeks so property in France is 20 percent cheaper than it was before Christmas. Prices in France have dropped about 10 percent on average over the last 12 months, but are now stable – people have waited for the last year to put their property on the market, now there is a lot available which makes it a buyers market with a stronger pound – so I conclude now is a good tome for Sterling of Dollar buyers for French property

…..I am also basing this on the feedback from guests at our home Villa Roquette since March most guests staying with us have been seriously looking at property for sale – two have made offers, three are returning with the intention of buying. In twelve years of renting and selling I have never seen such a high level of interest, even if the euro gets weaker, the demand for property will mean increases in asking prices soon I believe.

I am only referring to Languedoc as this is all I can observe but I guess the euro/price effect is similar elsewhere.

Many things happened in the last eighteen months – I worked in Paris, sold houses and had my websites hacked – not a happy time – I found business in Paris akin to milking snakes and the real estate business in France is not the nicest of ways to meet honorable people – so – back to the keyboard.

Mt focus now is to develop our home and property in the South of France as an island of calm, beauty and comfort – you can share this with us and I will be giving much more detail in these pages.

Thank you for staying with me and I hope to hear from you.

==

I am very interested in a fractional ownership in the south of France, perhaps in the Nice area. I like to travel with two small dogs, do you ever consider owners with very well behaved pets?I hope to hear from you soon.
Nancy

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Hello Nancy

Thank you for writing.

Fractional Ownership in France is very new – only a handful of properties, mostly Paris apartments, have been structured and sold in this way.

The reason is the care and precision needed to ensure the way the property is owned and the shares issued give clear and safe legal rights and to protect owners from future tax and government legislation.

I have been working closely with all the major individuals and companies involved in Fractional Ownership in France for the past two years.

Several people have approached me about suitable Fractional properties in Nice and, like Paris, I believe Nice is suitable for this sort of investment.

The question about pets (and children) has been brought up in all owners agreements – same state clearly that pets are not permitted. All agreement can be altered by a shareholders vote, usually by a majority decision. However, most Fractional Ownership properties are in six or twelve (sometimes four) parts and it may be necessary to structure the terms of the initial agreement that all shareholders, nit just the majority, agree to pets (or children).

One way to ensure this would be for you to advertise you desire to buy a property in Nice with a group of other like-minded shareholders – in other words, the other shareholders who accept or wish to have their dogs with them when they come to the property. You may also consider buying a property and then selling shares in it. This is what some owners in Paris have done, very successfully.

I can enquire if other people are looking for your wish – what period of time would you wish to use a property and what budget do you have?

I look forward to hearing from you

Best wishes

Tony

“Recently I had the unpleasant experience of dealing with two agencies in Pezenas who proved to be dishonest, deceitful and devious – combined with a client who was a sad and silly little man.”

and had this mail from a reader …

So Tony name names! (Or at least give me a private stir so I can steer clear).
Johnathan

==

I replied…

Hello Jonathan,

The “sad and silly little man” recognised his own description and wrote to me saying …

>>>
Tony

I realise you won’t dare to post this message, but if you do it will be a pleasure to tell your readers about my experience with you, compared to dealing with the decent and honest folk of Pezenas.

And I must warn you that any postings regarding my bad experience with you, which in any way identifies me or the agencies involved, will result in legal action.

< <<

As publishing this exactly as he sent it would reveal who he is (and he is a very nasty piece of work) then I suppose he could mess around with legal stuff and although what I am saying is true, I really can't be doing with the aggravation.

The story would be interesting and exposes several agents as lying, greedy cheating scumbags and this man as a pathetic and devious little twit.

Overall, nearly every agency I have dealt with has revealed themselves to be completely lacking in any ethics and, in these hard sales times, acting like starving rats in a cage.

I am working on software to eliminate these parasites so any buyer or seller can get together quickly and at no cost - I make money on carrying other advertising.

There are already advertising sites to introduce buyers and sellers in France http://www.pap.fr and http://www.entreparticuliers.com/ so far these only list, at present, a small percentage of all property for sale, but growing fast.

Thanks for reading

Best wishes

Tony

Psst – if you want to buy or sell your house just call on “Honest Tone”

They are aggressively sold by some developers to overseas buyers – usually the management company operating the rentals is not the development company. In my opinion they are usually a safe investment giving a low return, but they are not a way of getting a free second home, a free holiday or a home to retire into – they are an investment.

==

Hi Tony
Really enjoy your newsletters.
Just wondering if you have ever had any experience working with the Pierre et Vacance group on their lease back program. They have many properties and I have stayed at quite a few.
They have a “newish” program in Monflalnquin, an area I really enjoy that I am considering.
They want 10% down and allow you up to 4 and one half months a year for your personal occupancy. The rest of the time they rent it out for you, manage it and send you any outstanding money for the let. You must rent it out for 9 years, but that works out perfectly for us.
Sounds great, but you know what they say when it sounds too good to be true.
Would enjoy your view point of this.
Also…how bad are the Mistrals in the Provence area? Have read about them but can’t seem to get a handle on how bad they really are.

Keep up the great work and thanking you in advance

==

Hello Miriam

Pierre et Vacances are a very large group with strong government connections. They have been marketing leaseback properties for many years.

Although the initial lease is for 9 years – you must assume with Pierre et Vacances that they will enforce their legal right to automatically renew this lease .

If for some reason a leaseback management company does not wish to enforce their legal right to renew, then the leaseback is not viable – it is said that French owners pray for a renewal and foreign owners expect to have the property released.

If for any reason the property is not retained on leaseback after nine years you will have to repay part of the value Added Tax compensation.

No matter what the sales literature “suggests” you must assume that you never have the right to use the property completely for your own personal use or occupation, it is solely an investment.

Leasebacks are designed to be attractive to French resident, high level, tax payers – other than this they are not a good investment offering lower returns than an average building society.

Any use you make of the property yourself must be declared as a benefit and you could end up paying tax on the theoretical rent you should have paid to occupy your own property.

Because of the locked in aspect of a leaseback, capital gains are more in line with tenanted property than with the same property in vacant possession. It is therefore strange that people pay the freehold vacant possession price and then receive effectively a tenanted property. As an investment this is very bad at present.

For an investor in property you should expect to get a return about 2 percent over that given by current government bonds (or about 8.5 percent today) – this suggests to me that most leasebacks are about 50 to 80 percent overvalued even allowing for the VAT refund.

The Mistral is a horrid wind that blows about 30 days a year, usually between September and March, it can appear out of nowhere at any time. I have experienced them and they are truly ghastly – like banging your head against a wall, they are wonderful when they stop and the sky seems deep blue after the yellow of dust an mud whipped up like something from the Wizard of Oz.

Hope this helps

Best wishes

Tony

Recently I had the unpleasant experience of dealing with two agencies in Pezenas who proved to be dishonest, deceitful and devious – combined with a client who was a sad and silly little man I found I had worked for many days only to be abused and cheated. The problem is that the commissions for selling a house are very large and this makes people greedy. It also explains why many owners despise estate agents and many buyers try to avoid them if possible.

This is a recent mail from a reader and my reply outlining my plan to put myself out of business…I write about other ideas on my blog at www.Twiku.com

==

Hi Tony,

I am writing to see if you know of a good website or method to sell a house in France that avoids the bastard Estate Agents, who are worse than incompetent, useless, etc etc.What would you advise?
Love your websites blogs etc, keep up the good work.

Kind Regards,

Eamon

==

Hi Eamon

This is exactly what I am working on – a system to completely eliminate estate agents and help owners and buyers to get together, thus selling more efficiently and faster plus also saving the huge theft of “commission” for absolutely nothing.

I hope to be beginning an ebook explaining what can be done and how to do it – also I am working on some software to show what properties are listed for sale in any place and how to locate and contact the owners directly.

Best wishes

Tony

I have much enjoyed your newsletter since subscribing. I particularly enjoyed the article about French estate agents.

Isn’t it amazing how they don’t even try to make the properties look nice in the photos – they are so worried that you will recognise it and make a private deal with the owner.

The beautiful flat I bought recently in Pezenas (well, so far I’ve only paid the 10% and signed the compromis de vente) was advertised with an enticing close up of the rubbish bins on the terrace at the back.

When I was looking for the house where I now live I thought that one young estate agent had got lost on the way, perhaps due to his fashionable swept back sun glasses, but later I realised that he was, of course, trying to put me off the scent.
I have some questions that I would like to ask you, but this space seems a bit small!

Yours,
Kirsty

==

Hello Kirsty,

They are all so worried about looking at other people backs to stab and over their shoulder at their own back to remove the daggers, that they never know where they are. Sunglasses are usually to hide the demonic red eyes.

Delighted you are to be a neighbour – do write to me with any questions – the box on the site will take as many words as you wish, it is infinitely expansive (like me)

Best wishes

Tony

==

Dear Tony

Thank you for replying so promptly. Much as I enjoy living here (like you, otherwise we wouldn’t be here) there are times when the voice of a compatriot is welcome. Like you I chose this area becauseI think the Languedoc is absolutely amazing – beats the Uzes/Saint Remy de Provence area, which is so fashionable just now, into a cocked hat.

I live in a truly beautiful place – Our hamlet is in a cirque, surrounded by mountains, and a rushing stream drops into a pool at the bottom of our garden. There are wild flowers everywhere, and I am in the process of making a garden, which gives me great pleasure.

Since my arrival I have struggled with rude representatives of France Telecom, le Sydndicat des Eaux, EDF. le Credit Agricole. Our telly, which we bought at great expense from Darty – they of the ‘contrat de confiance’ – doesn’t work when it’s raining, I changed from France Telecom becuse their service was so terrible (at one point, as we waited in their shop in Beziers for over 2 hours to be served, my son said ‘It’s just like Egypt here.’), but tele2 aren’t any better, and now it’s entirely my fault that the phone doesn’t work – my son, who works for the World Bank in Washington, complains that it’s like phoning Africa – it works one time in 5.

I have always thought that Pezenas was an entrancing place, architecturally so rich, not too big, but with a certain sophistication. The idea behind buying a flat there was partly that I could have a bit of an urban fix from time to time – go to the cinema or out for dinner without having to drive home in the dark afterwards etc, and also to let it out in the summer months to have a bit of an income. Since I signed the compromis de vente, of course, the euro has soared, and I will have to pay for it very soon with my saving which are, of course, in sterling – not clever. I seem to recall that in one of your articles you talked about currency dealers, but I have no idea how all that works. My money is at present in the Nationwide, from which I would like to remove it, but I’m not sure how to go about it. I also need to talk to someone who understands my tax situation – it’s not very complicated, but I seem to be being crushed between the 2 systems.

My partner owns some land not far from here, and the idea is to build a simple, modern, ecological house in timber, with solar panels, geothermic heating etc – he loves all the stuff, and to sell here. I foolishly asked the estate agent from whom I bought my Pezenas flat to come and have a look at this house re valuation, and also because we are in a bit of a quandary as to how much of the work that we intended doing – including building a swimming pool in the ruined bergerie – it would be worth doing. I don’t suppose you will be surprised to hear that he thought I would be very lucky to get back the money I paid for it, never mind the money we have spent, and that we shouldn’t do another thing, just put it on the market at once. Although we were both pretty depressed at first, I know in fact that he’s wrong. Apart from anything else my potential buyer is very unlikely to be French, and this is certainly not a good time to attract British buyers. We will enjoy being here for a while yet,and see what next year brings. I still can’t decide about the major works, but we are continuing with the multitude of small thing that need doing.

I hope you don’t mind me unburdening myself on you at such length. I would be very grateful for any advice you can give me.

Best wishes,
Kirsty

==

Dear Kirsty,

Don’t believe a word that any estate agent ever tells you – they are all liars and are only interested in twisting the truth to their advantage – I know – I am one.

Here is a link to the best people I know for currency exchanges.

French services have no concept of customer service or customer relations – do not worry – they are as ignorant and rude to everyone – it helps to thump tables and shout at them, if you can cry at the same time it often gets results – I refuse to even go inside a French bank now and do not even have a French bank account, I use the post office which is just as bad but at least is dirt cheap.

I know nothing about finance, but I bet the pound rallies and by the end of the year will be back to where it was a year ago.

Generally, in my opinion, doing major construction just before selling is not a viable option, although it may get a client quicker – the other side of the coin is that it may put people off as they often want to do things their way and the work may have been better not done and the price reflect this.

Thank you for the invite for lunch, we are pretty boring people and rarely move far from home – but if you happen to be in Pezenas do phone me and we could meet for coffee perhaps.

Always happy to exchange emails and comment on things which may help others on a forum or blog.

Let me know if I have missed any points or you want comments on other stuff.

Best wishes

Tony

==

Hi Tony-

Hope you and Carole are doing well.

Last time we were in Vias we spent some time researching our options for Internet access in the house.

Just last night we were told by a friend who has homes in Paris and Provence that we would interest more renters if we did have wifi in the house. I know that we, personally, would certainly choose a rental that had Internet access above one that did not, but I am not convinced that people who choose our little village for a holiday would have the same priority. In all the years we’ve been renting we have only had one specific request about accessing internet.

Do you think that there is enough of a demand for Internet access that it would be worth our time and expense to obtain it for our place?

Thanks and fond regards from both of us-

Anne

==

Hi Anne

I do believe that it will get you more bookings – you do not know who does not enquire because you do not say you have wifi.

My experience is that every single person we had at our own place as renters wanted Internet access – we advertised we had it and we know we had renters because of this. It will cost you about 35 euro a month and you can then have totally free phone calls world wide and offer this as well.

Hope this helps

tt

==

Tony

Thanks so much for your response – sounds like we have a good reason to make another trip to Vias!
We’ve had recommendations for Orange, Neuf, and more, and most recently, Dartybox.
Do you have a preference? Vias is still behind the times – we can only get internet and phone, no tv yet included in the packages available to us.
Thanks again-

Anne

==

Hi Anne

We use both Neuf and Orange – both seem OK – only the big cities get TV at present, not us hillbillys

See you soon

tt

==

Hi Tony,
Have been reading your thoughts on leasebacks with interest.I cant agree with your comment “It is not something you should buy if you intend to use it yourself”.
I have two leasebacks in the south of France one has 6 weeks usage (three weeks in high season) the other, four weeks (two weeks in high season)They also pay 4.2% and 4.3% as a yield.
They are in fantastic locations which i used to visit about four times a year before buying these leasebacks.If you add the average cost (four hundred pounds) to the yield it makes it a great return as i will be happy to hold these for the next 11 years when my mortgage finishes.

I take your point on the lease issues and i was well aware of it prior to purchase in 2002 but due to the points mentioned Re: holidays,thought it was a risk worth taking.

on your point Re. Lease non renewal I have heard from two sources that they cannot penalise you anymore than one years rent. Have you heard this?.

John

==

Hello John

Thank you for writing and I am delighted you are happy with your investment.

Your mail is important as it raises points I will try to clarify – I assume you bought your leaseback investments a couple of years ago – interest rates and property prices were much lower then and the return you are getting is, I assume, based on the investment you made at the time.

I do not say leasebacks are bad, they are usually a sound low risk investment, but the benefit is designed for high rate French tax payers who can in fact finance the property from money that would otherwise have been paid as tax.

There are a couple of points which need to be expanded –

If you make use of a leaseback property for a few weeks yourself, this will reduce the return you get on your capital plus you are taking a benefit which is taxable – so the rent you would have paid for using you own property must be declared as income.

The rumor you have heard about compensation being limited to a year is false – compensation for cancelling a lease is not limited and can be enforced for all commercial losses sustained if the lease is not renewed.

I am very keen to hear all feedback about leasebacks, successful re-sales etc – I am not knocking them, they are a good thing for buyers and for France, but some sellers are “economical” with the truth.

Best wishes

Tony