French property: should you buy ancient or modern?

In France, the age of your chosen property can be critical, writes Jill Parsons
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The Independent Online

Fine wine, beautiful countryside and a certain French ambiance have seduced many Britons into turning an excellent holiday experience into a full-time plunge into the French property market.

While most start by wistfully admiring a charming wreck, not all go on to buy it. Increasingly, UK buyers are looking at the new-build market in a way the French, far less attached to owning homes and often more demanding of all mod cons, have been doing for years.

Whether it is better to buy a new-build or a resale often depends on circumstances. New-builds are usually purchased off-plan with a deposit of 5 per cent, compared with the usual 10 per cent with older properties. Payments are made in increments. When it is ready, building standards are strictly regulated, both in terms of build quality and fixtures and fittings.

Notaires' fees are lower for new-build, typically 2-4 per cent against 7-8 per cent on resale property, and there are no agents' fees, which range from 4 per cent up to 15 per cent for older properties. There are also no local rates for the first two years after completion.

For new-build homes, VAT of 19.6 per cent is levied, but this can be avoided entirely if the purchaser enters into a leaseback arrangement with the developer. The developer manages year-round rentals, with the owner having usage for allocated weeks, for a fixed period, most often nine or 11 years. If the property is sold before the lease is up, some VAT may be due.

These practical issues, however, do not address the sense of yearning for a traditional home and the romance of finding an old wreck to call your own, or thehorror of finding yourself tied to a French money pit or the resentment of devoting every holiday to DIY.

Phil Skinner and his wife Julia fell in love with numerous old houses in France before realising that, above all, they wanted to avoid hassle and expense.

They chose their development, near the town of Pamiers, from A Place in France, a Portsmouth-based new-build specialist, paying a €20,000 (£15,000) deposit on a €97,000, one-bed flat in 2005.

"We felt that new build was the only sensible option. If you buy an older property, you generally have a lot of house and land for your money. Certainly, we could have found cheaper. But old buildings mean trouble, hassle and money, with no real guarantees and potentially no limit toexpensive maintenance."

They are undecided whether to rent out their one-bedroom flat when it is finished next year, as Phil, an engineer in aviation, has a dream of living in France full time. But he acknowledges: "Renting is very popular in France and new-builds achieve a good price. And, having bought off-plan, it will be worth more than we paid for it on completion.

"Once ready, it's done and guaranteed. It's on the edge of a beautiful town, near the Pyrenees. It's accessible and easy to travel around.

"As non-French speakers, the biggest advantage was the help given to us by the developer, from finding English-speaking lawyers to advising us on setting up a French bank account. Buying new has been the right choice."

Command of French proved vital to Lee Goodall, a freelance writer, and Catherine Lees, marketing director of Queen Cosmetics, who began their search following a cycling holiday through the Midi-Pyrenees.

"The fact that Cat spoke fluent French definitely broke down barriers and made us friends," says Lee. "It can be difficult to arrange viewings and to explain your exact requirements, but for us that was not an issue."

The couple bought a house in the village of Arvieu near Aveyron, in 2003. "We were very disciplined about the budget, as it's so easy to be seduced by the lovely farmhouses needing loads of work. We didn't want a millstone in years to come and, fortunately, we did not go through the rigmarole of a French mortgage. Our budget was £50,000, which back then was enough. All told, we paid £40,000 with fees. The work was largely cosmetic, costing £10,000.

"For the first six months, we travelled out there every weekend, but progress was slow. So we decided to live there for six months to finish it off. We rented out our flat in England and lived on a budget. I was worried how we would adapt, but it was dirt-cheap in terms of food and wine. One big disadvantage was losing track of the building budget after so many trips to Monsieur Bricolage, although labour costs were just us.

"There are clear disadvantages to buying an old house: the headaches of renovation, the gambling on workmen turning up and being there to meet them, not knowing all the basics about an area. For six months, we didn't go out.

"The advantages, however, were huge. The potential of older houses, with land or outbuildings, means that you have a home in France that you could never afford in England. We have also been welcomed into the community and have been knocked over by people's kindness and generosity.

"Buying an old village house has definitely helped lay the foundations for enjoying the property for life."

A Place in France: www.aplaceinfrance.co.uk, telephone 023 9283 2949

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