The France investment property  industey has stayed stable despite the global recession and has continued to attract investors and second home buyers alike. One of the reasons for this is because of the Leaseback scheme.

France is undeniably the most visited tourist spot in the world. With the continuous growth of the tourism industry, the requirement for rental property is consistently in great demand with a lack of quality accommodation to satisfy the demand.

Because of this, the French Government launched the French Leaseback property scheme in 1986. The scheme aims to help fulfil the ever-increasing demand for rental property from tourists and especially in the popular areas like the Mountain regions which have a very high demand for good French ski property for example.

The concept behind the leaseback program is relatively simple: an investor purchases a property and then allows a management company to rent it for an agreed specific period of time (normally 9 – 18 years, or 9 years renewable) in exchange for a guaranteed rent within that specific time period. The investor also has the benefit of an agreed amount of usage from the property themselves, normally a few weeks a year out of peak season.

Two Types of French Leaseback Property:

  1. Your property is rented without furniture, which is called “murs nus”. It becomes the responsibility of the management company to put the furnitureinside the property.
  1. “Loueur Meuble” which means that the property is fully furnished at the time it was rented by the management company.

Not all properties can qualify for a leaseback as the government in France has set specific standards for the materials and constructions used in the building of the property.

Another benefit for leasebaqck investors is that when the French Leaseback property has been managed for 20 years of rent, the investor is entitled for a refund of value added tax paid within six months after the actual date of purchase.

Another great benefit with French Leaseback property is that the management company has the responsibility to maintain the healthy condition of the property and if any maintenance & repairs need doing, the management company are the ones who will cover the costs.

 

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Filed under: Foreclosures Investing

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