Purchasing abroad

We can introduce you in good faith to the legal team of the developer in question, to ensure your interests are protected with care.

Sale & Leaseback

With most owners only using their properties for just a few weeks each year and the demand for accommodation ever increasing, the French government introduced a scheme to entice owners of new properties into renting them out when not in use.

The scheme known as 'Residence de Tourisme' in France, which we term as Leaseback has been running for over 20 years and has proved to be very popular amongst purchasers of holiday homes.

The purchaser buys the freehold of a new property (within designated projects only; those which have the status "Residence de Tourisme") and then leases it back to the developer for typically a 9-11 year term. The key incentives for the owner are:

  • The owner is guaranteed to receive every year a net income of typically 4% - 6% of the purchase price, which is indexed linked.
  • The owner can usually use the property for a designated number of weeks per year.
  • The owner can claim back the VAT (19.6%) on the property.
  • All the management and maintenance costs during the 9-11 years are the responsibility of the management company.
Throughout the 9-11 year lease period the management company will run the project as a hotel of self contained apartments. Because the management company has to provide guaranteed incomes to all the purchasers within a Leaseback development it is essential that all the properties remain rented for the majority of each season. This is achieved by building very high quality projects in prime locations complete with facilities such as pools, gyms, health suites, stream rooms etc.

Once a client has identified a property, a contract "Compromis de Vente" or a promise to purchase contract is signed. A typical deposit of 5% is paid direct to the Notary. This protects the client's funds. At this stage the client will apply for a mortgage and the Notary will start the legal paperwork. At the completion of this process all parties are called to a final meeting where the final contract "Acte de Vente" is signed.