Buying property in France can be very enticing, as many of us can imagine. Seeping a glass of chardonnay at the veranda of your chic cottage house in Eastern France sounds like a dream come true, but is now the best time to invest in French property? Especially with Brexit taking place?
Paris sounds amazing
While not traditionally a foreign buyer’s market, Paris appears promising and a safe investment, especially when compared to London. According to Mansion Global, real estate experts are expecting a favorable climate due to the “business-friendly Macron government and the impact of Brexit on the U.K.” Prices are also increasing as a result of Brexit, but also “due to a low supply of luxury housing, as well as excitement around the upcoming Olympics.”
The article quotes Mr. Tostevin who commented:
“It’s interesting to compare Paris to London, which we’ve seen often. It hasn’t been a big international buyer market, though those numbers have risen thanks to an improving domestic economy and a little bit of Brexit interest.” And Ms. Law said: “Paris is already a big beneficiary of Brexit. The city is attracting financial professionals as its banking sector expands. The 2024 Olympics pulls in investors who expect prices to rise over the next five years.”
According to Knight Frank’s Prime Global Forecast 2019, a number of events in 2019 are likely to impact prime residential markets, one of them being, of course, Brexit.
As Kate Everett-Allen, Partner, International Residential Research at Knight Frank said: “Of the 15 cities monitored, the key European cities of Madrid, Berlin, and Paris, lead our forecast for 2019 with a growth of 6%. Still positive, but marginally down on 2018, the normalisation of monetary policy, weaker economic growth, and a fragile political landscape post-Brexit will influence demand, but the relative value of these cities remains a key driver.”
French House Prices in 2019
House prices in France have undergone a period of readjustment. While the French property market has been dealing with issues such as rising taxes, stagnant wages and low growth since the 2007-8 financial crisis, it has not been so much affected as other European countries, such as Spain and Portugal.
BNP Paribas, International Buyers, in an article on real estate in France, pointed out that “France has always enjoyed one of the most inflationary housing markets in the world, and people considering property investment in the country have reason to be optimistic.” As it highlighted: “history suggests France’s real estate sector is one of the healthiest in the world.” Most importantly, in terms of stability, the BNP Baribas article concluded by stressing that the “French property market is one of the most well-regulated in the world, so British investors should not be too concerned about the country’s long-term future.”
Should Brexit affect your decision to buy your dream home?
As nobody is quite sure yet what will happen with Brexit, moving to France now may sound intimidating. But, as long as you have the right papers and you are determined to make the leap, then you are halfway there.
Make a decision now
For many experts, making the decision right now, before things are solidified is the best decision you can make. Even if there is no deal on the 29th of March. Kim Bingham, head of international markets at property financing company Private Rate, said: “If you can take anything away from this situation, I would say don’t hesitate about making an investment in France.” She added that there was a growing interest in smaller French properties worth around €20,000 to 40,000, which many are buying in order to secure something in France and then wait and see.
Need to have “sufficient resources”
If the UK leaves the EU with Theresa May’s deal, then the 29th of March will be followed by a transition period until December 2020. This will enable Brits to move and settle down, establish their legal residency status by proving they have “sufficient resources” to do so.
Kalba Meadows, the head of the Citizens Rights team at Remain in France Together said: “We’re seeing really large numbers of people moving heaven and earth to get a legal foot in France before Brexit day. With time so tight it’s even more important to be clear on what legal residence means.” As Kalba explains: “People thinking of trying to arrive before March 30th still need to make sure that they can prove that they’re legally resident on that date – it’s not enough just to have a foot on the soil, even if you already own your own home, but you need to meet all the conditions for legal residence as an EU citizen. So for example if you’re retired or not economically active, you need to have ‘sufficient resources’ to support yourself so that you’re not a burden on the state (and there are guideline figures for this) and if you’re setting up a business you need to show that it is ‘genuine and effective’ and not marginal or ancillary.”
If you are considering buying property in France, get in touch with us to discuss your personal or business currency transfers.