Finance - Leaseback
Leaseback has become an excellent, hassle free way to invest in property in France.
It is a process whereby a buyer can purchase an 'off-plan' apartment and then lease it back to the developer in return for a fixed, guaranteed annual rental income.
When you purchase a French leaseback property you own the freehold of the property from day one. The title deeds you receive are exactly the same as if you purchased the property without a lease. You are simply signing a lease agreement for your property to be professionally managed.
The main benefits of buying a leaseback property include:
- An instant price discount of 19.6% VAT
- Guaranteed 3% return on the purchase price
- Guaranteed rental income for 9 years
- Limited running & maintenance costs
- Flexible private usage in the ski season and at other times
- A fully furnished and insured property
- Peace of mind that a professional management company is looking after your property
Example within Le Carlina residence + spa
We have taken apartment 19. The apartment is available for 330,000.00 Euros, but if you opt for the leaseback scheme you will receive the property for 275,919.00 Euros. The only other cost will be the furniture pack and Notaires fees. On an annual basis you will receive at the end of each year 8,277.57 Euros which equates to a 3% return.
The French Government will give you this discounted amount of 52,081.00 euros if you allow our tour operator to manage the property on your behalf. The reason for this approach is that it will provide more tourist beds which in turn will attract more tourists to France. Not only is tourism France’s number one income generator, but France is also the most visited country in Europe and the Government wants it to stay that way.
Once you are in the leaseback scheme and you decide to sell your property within the leaseback period (normally 9 years) you are able to do this without penalty as long are the purchaser continues your leaseback agreement. If however the purchaser wishes to opt out if the leaseback there is no penalty from Le Carlina, however the French Government will request a percentage of the lump sum you received as a discount when you first purchased the apartment. This amount totally depends on the length of time you own the property for and as such we would recommend that if you are considering leaseback it is looked at as a medium to long term lifestyle investment not a means to make a quick buck.
