“The first falls in the French Alps in October prompted potential buyers to get in the mood for skiing and think about having a place of their own on the slopes,” says Nathalie Turchet, UK sales manager of MGM French Properties. “The result is that we have seen a steady rise in the number of enquiries for ski properties since November.”
Despite the credit crunch, Nathalie is confident that 2009 will be similar to 2008 for the property market in the French Alps in many ways. She says: “Properties in the right locations will continue to sell, albeit more slowly than hitherto, but the average sale price will hold up. Interest rate cuts in the UK will help to ensure that funding through equity release and borrowing gets easier.”
The firm reports that the rental market remains strong with the number of winter bookings looking promising ahead of the ski season. That is good news for the buyers of investment properties who.
Typically the buyer of a property priced at £693,741 (€795,000) would save £208,122 (€238,500) under a leaseback option whereby the price paid is reduced by 30 per cent, representing a waiver of VAT at 19.6 per cent and a further reduction in lieu of rental income during the 11-year term of the lease agreement.
Deals of this type have proved to be an added attraction for UK buyers who have accounted for a quarter of the off-plan purchasers of apartments in MGM’s latest new development, Le Telemark at Tignes Le Lac. Funding of a property purchase in the French Alps can be easier than it is for a property in the Britain, explains Nathalie.
“Unlike the UK and the USA, France always has had very strict mortgage lending requirements,” she says. “Today, French lenders generally are in a healthier position than those in the UK, especially since Nicolas Sarkozy confirmed the government’s bank support plan. Interest rates in France are set to drop in the course of 2009, so that will be a good time to borrow.
“France remains one of the most popular countries with British second-home buyers and holidaymakers, and this is unlikely to change in the forseeable future. However, if a Labour government implements the predicted hikes in income tax and National Insurance for middle and high earners, that could have a negative effect on some would-be purchasers and might prompt even more Britons to make a permanent move to France.”
