If you want to reap a financial benefit from owning a property in France, why not consider long-term lets, says Anne Cunningham-Davis
In France it is customary to rent rather than own property, renting from a professional landlord whose business is letting properties to people as their permanent and only place of abode. Their tenure is governed by strict rules with secure tenancies based on terms of three, six or nine years and the properties are let unfurnished.
Many people think that is the only way they can let a property in France. However, this is not the area we are talking about here. The definition of ‘long-term’ for our purposes covers places to rent for longer than a holiday though shorter than a permanent let. So, this article is directed at the concept of ‘non-professional’ landlords.
These are often expat owners. If you own a property in France, it is possible to make it work for you by earning income from the periods you aren’t using it yourself. Or maybe you want to sell. In the current economic climate, this is not easy, and unless circumstances are so compelling that you have to sell at any cost, one option might be to let the house for a year or so while you wait for the property market to improve and then use the income to rent elsewhere before re-buying.
Renting out long-term still gives a good return in spite of the tax implications and in the current climate panic selling is not the answer. Several years of successful renting for people with second homes could cover the increase in capital gains tax when the economic climate is better for selling. The average rental income is between £600 to £1,200 per month when letting off-season or year-round.
Other people perhaps have extra accommodation adjacent to their home, commonly known as gîtes, that they rent out on a weekly basis during the summer months. But as they come to find, it is a lot of work spending effort on changeovers, cleaning and maintenance when compared with finding longer-term tenants whose rents can better the amount gained from the few weeks of the summer season.
There is also a slowdown of holidaymakers from the UK but an increase in people who want to stay for several months. There is a lack of the kind of property that caters for the needs of the latter.
If all this sounds interesting, the first thing to consider is whether or not you are happy to have tenants; after all it may be preferable to leaving an empty property, which can deteriorate or might be vandalised.
You need to offer it as a furnished rental for periods of up to one year. This is called location saissonière for periods of up to four months or location meublée for up to a year. It is commonly advertised as long-term lets in English, but as previously explained, it means longer than a holiday but short of permanent.
It is advisable to have a French lease, which can be quite simple and needs to include an état des lieux (state of the property form) and if it is a period of longer than four months, a DPE energy performance report is now required. You should also make an inventory of everything in the property.
If you are worried about having the property looked after, there are companies that specialise in maintenance/cleaning in your absence or who will simply hold the keys and keep an eye on the place for you. Lots of small enterprises are springing up to offer this service for a reasonable fee. Some are younger people who have moved to France and have decided to make a living from it or young retirees who are looking for an extra income. Other items of general maintenance can be written into the lease, for example, keeping the gardens tidy. It would then be up to the tenant to find a maintenance man or gardener or to do it themselves.
There is a healthy demand for this type of accommodation. Apart from families wanting a new life and looking to try before they buy, or younger people coming to France to work, there is also an increasing number of newly retired couples from all over the world wanting to explore Europe. France is often where they think they have the most central base. The winter is a popular time to rent; as one of our clients said: “Anything to escape the Canadian winter – it’s just like spring here, in Normandy.” We were all shivering in the December chill.
Most people plan their trips well in advance, so even if a property is currently let this year, it is worth keeping it advertised. These clients can book up to two years in advance, particularly if they are coming from as far away as Australia and New Zealand.
They need a lease to get a visa and open a bank account in France and even to set up a broadband connection if it is not offered with the property.
We probably have scores of people contacting us for suitable accommodation for between four and six months stating that all they can find is holiday lets. Owners who would let long-term if it were requested are lost in the thousands of holiday lets on many websites springing up on the net.
Second homes, gîtes and converted outbuildings form the majority of properties, but there is also a need for apartments, and there’s no reason why mobile park homes would not be considered. There is no specific area which is most popular. Some people are chasing the sun and others want proximity to the coast or ports or low-cost airlines to give easy travel links. Others are looking for complete tranquillity in the countryside, so don’t be put off if you have a rural property. With the concept of working from home, professionals such as artists, writers and researchers can embrace the French way of life while still doing their job.
In our experience lots of people are concerned about embarking on letting their property but once they have tried it, they are pleasantly surprised at how easy it can be. Others are concerned that they may have to give up their visits to their holiday home. But it can be stipulated that the tenants vacate for one or two weeks so that the owners can stay. Or on the other hand, you can only accept lettings which fit in with your requirements. It is the owner who calls the tune, and sometimes tenants even become friends especially if they later find a house to buy in the area. LF
Anne Cunningham-Davis and her husband Tom run French Locations, specialising in property lets www.french-locations.co.uk