Brits locked out of French second-home market by Gill Montia

Brits locked out of French second-home market

The credit crisis and fall in the value of sterling has crushed the aspirations of Britons who dream of owning a holiday home in France.

According to Fnaim, the online association of French estate agents, the market for second homes in France is collapsing with properties lingering on the market even in areas such as the Dordogne and Brittany.

Britons are the countrys biggest ex pat second homeowners, holding 29% of the countrys 260,000 foreign owned homes, followed by Italians at 14%, the Swiss at 12% and Germans at 11%.

The downturn in the market began in early 2007 and has been accelerating to the extent that Charles Regnauld, a Brittany estate agent, estimates there have been 50% fewer transactions with British clients since the beginning of this year.

A similar picture is reported by Charles Gillooley, the head of Fnaim’s office in the Dordogne, where around 20,000 Britons own second homes.

Mr Gillooley believes the main problem is the 15% fall in the value of the pound against the euro, over the past 12 months.

He adds that the financial crisis has also played its part, making it difficult to secure funding.

Meanwhile in Paris, one estate agent estimates the decline in British and US homebuyers at 20%, since September.

Source:Homemove.co.uk

Experts have been shouting about the French market picking up for a while now. Trisha Mason from French property specialist firm VEF said the number of Britons buying French property had dipped during the credit crunch because the fall in UK house prices reduced their main source of funding such a purchase.

Ms Mason said,However, the signs are that things are slowly improving again. Most Britons who buy in France do so for lifestyle reasons, with the perceived superiority of health and education services being major factors.

The French property market is also said to be entering a period of greater stability after French president Nicholas Sarkozy announced that a 280 billion pound package was being implemented to bolster the banking system in the country.

The increased market confidence and UK interest rate cut means that it should be easier for UK residents buying French property to borrow from British lenders.

Notaires de France figures show that house prices in Nice have risen by ten per cent and apartment prices by 7.27 per cent over the past year.

Nices increases are superior even to those in Paris- the city of light saw a 9.7 per cent rise over the last 12 months. Other city centres across France saw prices rises of around five per cent.

The capital of the French Riviera, Nice is an affluent city and a great place from which to explore the rest of the Côte dAzur and nearby Monaco. You could even take one of the frequent ferries across to Corsica.

The best value properties in Nice are to be found north of the railway station. Brand new homes are much in demand and there is a lot of land in the west of the town awaiting development.

Nice also has an exceptionally strong rental market, with a particularly strong demand in the summer. Long term letting is a popular option during the winter months, with students, expatriates and locals as the main tenants. Average rents in Nice are the second highest in France, after the greater Paris region.

Mr de Rouffignac said, Contrary to what some people think, now is still a good time to buy French property. Source:The Move Channel.

The state of the UK property market influences who is going to buy property abroad and when.

For that reason we are going to start to include news on the current situation on this page.

It will include everything from the mortgage market, the state of the market place in general and predictions for the future both in the UK and abroad.

Currency also plays a part and we will comment on the state of the dollar, the pound and the euro.

The objective is to give as wide a view as possible of the market in which we trade.

The state of the UK property market influences who is going to buy property abroad and when.

For that reason we are going to start to include news on the current situation on this page.

It will include everything from the mortgage market, the state of the market place in general and predictions for the future both in the UK and abroad.

Currency also plays a part and we will comment on the state of the dollar, the pound and the euro.

The objective is to give as wide a view as possible of the market in which we trade.

Monday 18th August 2008

Asking prices on Rightmove are continuing to tumble, and are down by an average of 2.3%,or 5,403,from a month ago.

In London, where the deterioration is most marked, asking prices are down 5.3%, or an average of 21,096.

Properties are also taking far longer to sell, with agents have an average of 78 unsold properties,compared with 77 a month ago, and 63 last December. Yet the number of new listings on Rightmove is just 106,000,a quarter of what is normal for August.

Rightmove blames the mortgage drought and warned that transaction levels may drop to levels not seen since 1959.

Share prices in Rightmove fell 8% on news of the price drops. The fall also followed a story in the business section of a Sunday newspaper which revealed that the paid-for portal will soon have a rival in the form of the National Association of Estate Agents new, free website, Property Live.

Buyers still looking overseas, claims Conti Financial Services

Despite the falling pound and on going Credit Crunch, thousands of people in the UK are expected to buy overseas property this year, a financial service company has claimed. Conti Financial Services said that cheaper travel options, better investment opportunities, or the desire for a better quality of life, have all served to encourage the purchase of property overseas.

The firm says that UK estate agents can benefit from tapping into this market, but warns it is not a decision to be taken lightly, as venturing into the overseas market can be fraught with difficulties.

Each country presents a myriad of national and local laws, customs and language barriers that may put off all but the brave, says the firm which has more than 14 years experience in the overseas mortgage markets.

Here is a great article from the Western Mail discussing how well known sports and screen celebrities still look at investment property for long term gain and security.

Comedy stars 1m pound property portfolio

Jul 14 2008 by Andrew Dagnell, Western Mail

GAVIN AND STACEY star Joanna Page has revealed how she is following the example of fellow hometown actress Catherine Zeta Jones by building her own millionaire property portfolio.

Yet, while Swansea born Zeta Jones and husband Michael Douglas have picked several sumptuous residences as international bases, Page has chosen to join the ranks of celebrity buy to let entrepreneurs.

The star and actor husband James Thornton now own houses in up-and-coming east London, where the Olympic village is being developed, a home in a Bulgarian ski-resort and an exotic pad in Brazil.

The couple, who have been married since December 2003, live in another house in Dulwich, an expensive area of south London.

They hope their buy to let homes will allow to them to bring in an extra stable income while the price of their properties increases over time.

Page, 31, said, Apart from the Dulwich house, we have a number of buy to let properties worth about 1m in total. We usually buy in areas where theres going to be lots of development so hopefully they will weather the downturn more than some other areas. Rentals are also going up,they cover the mortgages and we also have some money on top of that. We have a new build property in Crystal Palace which we bought two years ago and another one near the Olympic site which we bought about nine months ago. We also have an old terraced house on Lordship Lane in south east London which is close to the new East London line extension.

Joanna added: Outside of Britain, we have a place in an up and coming ski resort, Bansko in Bulgaria. We bought that about a year and half ago and its not yet complete. I know there are some oversupply issues, but again, its a long term investment. Weve just got involved in a development in Bahia in Brazil. Its one of these resorts with a golf course and its right on the beach.

Joanna has lived in London since she was 18, after she moved there to pursue her acting career.

But she said her worst investment had been much closer to home,in Swansea where she grew up and went to school. The couple bought some flats and a bungalow there, but have regretted it because of the slump in property prices.

Page said: We also have two apartments in Swansea which havent been built yet. We also have a little bungalow in Swansea which were doing up. This hasnt done so well and were in the process of selling. We got it last year, but our margin has been completely eaten away by the fall in the market. We bought it for 140,000 and its now on the market for 150,000. As weve spent about 10,000 on it, were just hoping to get our money back.

Despite the dire warnings about the continuing effects of the credit crunch, one Welsh estate agent last night said the buy to let market was still a potentially lucrative investment.

Nick Davies, director of Nicholas Michael Estate Agents, said: Now is very much the right time to be buying because we are in a falling market.

We are seeing properties that are probably worth a lot more going for a lot less.

We are now bottomed-out and I dont know how long it will be before prices start going up again.

Our message is buy now before prices go up again. Property is always the best investment, you can’t go wrong with it.

Sports stars build on their assets

JOANNA PAGE isnt the only celebrity cashing in on the property market by acquiring a number of buy to let homes.

Boxing star Joe Calzaghe has got buy to let homes in London and Egypt, including a one-bedroom investment apartment that cost 32,950 in Regency Towers on the Red Sea coast.

At the time he bought them he said: House prices are so high in Britain these days. Im looking at off plan properties in places such as Sheffield, but I dont think theres much money to be made any more in property at home.

The 35 year old added: I went out to Sharm el Sheikh last year and really liked the place. The weathers great, the people are nice and I had a good time snorkelling. At first I was in two minds because of the bombings a few years ago, but property prices are low compared to many other sunny locations so I thought Id go for it.

And former Cardiff FC footballer Robbie Fowler has also dipped into the property market in a big way. Hes amassed a 30m fortune through a buy to let portfolio of some 100 properties,including a pub converted to flats,across northern England.

In Burder Road and nearby Limeside Road, Oldham, Fowler bought up entire rows of terrace houses to rent out. He also converted a hotel in Airdrie, Scotland, into a number of luxury flats and has invested in property in Manchester and London. So extensive is his portfolio, Manchester City fans used to sing We all live in a Robbie Fowler house, to the tune of Yellow Submarine when he played for them.

The current situation in the US property market is extreme however there are a number of reasons why this is still a great time to buy there for property investors.

1) The pound and euro are strong against the dollar.

2) There are fantastic discounted property deals to be had.

3) The rental income has stayed the same making the return even better.

4) In the medium and long term a couple of these factors will also improve again adding value to an investment made now.

From The Times
July 9, 2008
Savills: property market headed for deeper downturn
Anne Ashworth and Judith Heywood

The property market is careering towards a longer and deeper downturn than expected, according to Savills, the quoted estate agent, which yesterday reported that prices were falling even in the formerly resilient smarter London postcodes.

Prices have subsided by 7.5 per cent this year and could drop another 8 to 9 per cent over the next 12 months.

Jeremy Helsby, Savillss chief executive, said: People are not buying because they think that property will be worth less tomorrow: buyers and sellers are in a kind of Mexican stand-off.

However, London could be the first location to start to emerge from the slowdown, recovering more quickly than the rest of the UK.

The gloom is spreading to manor houses and estates, which were unaffected until recently by the malaise elsewhere. Transaction volumes in the whole residential market have fallen by 45 per cent since July 2007.

Mr Helsby said that properties of 5 million plus were the only part of the market standing firm. He said: The super prime market is very, very strong. There is huge demand driven by Middle Eastern investors.

Elsewhere, in a markedly downbeat trading update, Savills said that the return of confidence depended on the mood of financial markets which showed no sign of improvement.

UK tenant demand is good in Savills commercial division, but rental growth is subdued.

Asia remains the strongest performer among Savills International commercial businesses; Europe is caught up in the credit squeeze. Mr Helsby said that its US business continued to perform in line with expectations.

However, on a rare note of optimism, he added: The US will come out of this before the rest of the world.

It's not just us that think now is the time for investment in the USA. In January this year the Bank Of Ireland expanded into the US property market.

This is the article at the start of this year.

DUBLIN, Jan 21 (Reuters) - Bank of Ireland Corporate Banking said on Monday it had hired five new people to boost its property finance team in the United States. Irelands second largest bank has been seeking to grow its U.S. property business since it was set up in July.

The arrival of an expanded team in the US reinforces our commitment to growing our niche, skill based businesses internationally, Tom Hayes, Bank of Ireland Corporate Banking Chief Executive, said in a statement.

The bank said last week it had established a property finance unit in Frankfurt, aiming to cover European markets.

An end to Irelands decade long property boom, in which house prices quadrupled, has put the brakes on years of rapid growth in the country, with banks seeking to expand their operations in other areas. (Reporting by Jonathan Saul; Editing by Quentin Bryar)