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New Build in France

A guide to the availability of new build property in France

Lack of new build property in 2010

British buyers seeking new build property in traditionally popular areas of France have been coming up against a new problem. French mortgage specialists, Athena Mortgages, have reported that in 2010, those buyers from the UK who sought to purchase new build properties in areas of the Alps Rhône-Alpes Property Guide), Paris (Paris Arrondissements Property Guide) and Provence (Provence-Alpes-Côte d'Azur Property Guide) have been finding a distinct lack of available property, at least that of the most desirable nature.

Not everyone wants to renovate

As far from all British or overseas buyers seek old properties to renovate (House Renovations in France), as is often widely misconstrued, this has created an imbalance in the property market hitherto unforeseen, and completely at odds with the situation across the border in Spain, where the new build market has all but collapsed in recent years due to over supply.

Loi Scellier - the cause of the problem

The difficulty has arisen due to tax breaks for French residents introduced by Sarkozy, allowing them to offset 25% of the value of the new build purchase price against their income tax bills. The resulting surge of canny French buyers seeking to make the most of the new law, known as the Loi Scellier, has meant that last year saw a distinct shortage of this type of property, and left British buyers struggling to compete. In addition, French buyers have been able to benefit from low interest rates which have further encouraged the surge in demand for new build property in prime locations.

Changes in tax breaks and interest rates

Things may be swinging back in favour of overseas buyers, however. John Busby, the managing director of Athena, explains that although the tax breaks for French buyers will still be in force this year, the allowance is now being reduced to 20%, still a significant amount, but less than in 2010. French interest rates are rising, and the future direction of these is unforeseeable at this time, which could also have an effect on the domestic market confidence and performance.

Increased supply of new build properties

Another factor which will ease the situation for British and overseas buyers is that there has also recently been a considerable increase in the supply of desirable new build properties in France. Many new leaseback properties (Leaseback Property in France) are ready to come onto the market this year, creating fresh interest and allowing more possibilities for potential buyers. Key areas for new build and leaseback include the ski resorts of the Alps (Alps property), where a new development at Belle Plagne (La Plagne Property Guide) has now been completed by Terresens developers who are currently creating further, similar developments in the region.

Additional articles which may be of interest:

New build property in France
Ski property
French leaseback property - Top 10
Letting property in France

About the author

Joanna Simm moved to the Languedoc area of south-west France in October 2004 having found her property through French Property Links.

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