Paris Real Estate Bucks Recessionary Trend to Benefit From Sarzozy Tax Incentive Laws

la-defence-property-franceFrance’s capital, Paris, has been a direct benefactor of Sarkozy’s two year reign as prime minister of France, and seems to be taking the economic climate in its stride.

Its property market has remained stable and even seen a price increase in apartments, which the Notaire de France’s October 2008 report revealed had increased by 10% this year. The commuter towns surrounding Paris, such as Orleans, Tours and Reims, have also seen a healthy increase in house prices of 10.5%.

The right wing Sarkozy Government has brought in a raft of laws which continue to stimulate the construction industry and create sustained demand for residential property.

In quick response to these changes in the law, Pierre & Vacances has launched two investment opportunities in Paris – one in the centre of Paris and the other in the business district of La Defense.

Paris Bastille Marais, is a seven-storey building located on a tree-lined street in one of Paris’ most desirable areas, a stone’s throw from the vibrant Place de la Bastille and the architecturally stunning Place des Vosges. Orly international airport is a 20-minute drive away, and the three closest Metro stations operate direct lines to the city’s main train stations: the Gare du Nord (for Eurostar connections to the UK and Europe) and the Gares de l’Est, de Lyon and d’Austerlizt.

“This is a particularly exciting investment opportunity for a number of reasons,” comments Nick Leach. “Paris is the most visited city in the world, attracting over 30 million visitors each year and giving these properties immense long-term investment potential. The Chambre des Notaires de Paris recorded capital growth of nine per cent over the last 12 months.

Paris Bastille Marais contains 138 air-conditioned studio and one-bedroom apartments, each fully furnished and complete with kitchen appliances, TV and wi-fi internet access. Twenty-four hour porterage is provided, and there is a private garden at the centre of the building.

Prices start from €247,000 (excluding VAT, furniture and parking). The guaranteed annual rental return will be up to four per cent of the purchase price, index-linked to the Dwellings Rent Index of France, and net of all management charges and running costs. 100% mortgages are available on a repayment basis, and mortgages of up to 90% are available on an interest-only basis (subject to status).

The Paris Bastille Marais residence bears the Citadines brand, which is currently owned by Ascot Holdings.

La Défense Esplanade

La Défense enjoys a prime location, dominating the west of Paris and just 10 minutes away from the Arc de Triomphe. P& V are offering 96 turnkey apartments at La Défense Esplanade, a true sanctuary for working and relaxing in the heart of the Michelet district..

Accommodation starts from €252,320 to €527,113 (excl VAT) from studios to three-bedroom apartments ranging in size from 28sqm to 55 sqm and featuring desk, air conditioning, Wifi connection, flatscreen TV, kitchenette and more. La Défense Esplanade residence also has a communal breakfast room and offeres a wide range of services including business corner, luggage room, safe, ironing and dry cleaning services.

Nick Leach, P&V Head of Business Development UK and Ireland says: “These laws have incentivised promoters to build again especially because the tax benefits apply for properties delivered between now and 2012.

“There has been a definite increase in supply and demand for French leaseback properties as confidence returns to re-boost the French property market ahead of other countries. Foreign investors benefit indirectly from the knowledge that France remains a safe and stable place to invest.”

“Other advantages for foreign investors buying French leaseback properties are the VAT rebate, guaranteed rental income (currently around 4% net of all charges and running costs with P&V). Rental income should be free of French income tax (as you can offset expenses, amortization, and mortgage interest) and free of French CGT after 15 years making it a compelling investment in one of the world’s most stable and solid property markets.”

Interested clients should contact P&V’s London office on 0800 001 5551 to discuss investment options.

Pierre & Vacances in numbers:

  • A tourist network of 45,000 apartments and houses
    210,000 beds – by the sea, in the mountains, in the countryside, and city centre

  • 3 main brands: Pierre & Vacances, Center Parcs Europe and Maeva
  • 6.5 million customers per year
  • 8,500 employees.

Since launching the “Nouvelle Propriété” in 1979, Pierre & Vacances has offered private investors the opportunity to enter the lucrative real estate rental market by becoming a freehold owner of a holiday property with a leaseback.

The Pierre & Vacances Group is quoted on the Paris Stock Exchange and is a member of the SBF 120 (French equivalent of the FTSE100).

For further information, please contact:

Nicholas Leach
Pierre & Vacances Property Investments
00 44 (o) 207 471 4500
uk@pierre-vacances.fr

Kerry Clark
Tideway Communications
020 8878 0787
Kerry@tidewaycommunications.com

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