Rising French Property Values – Building off 2010
• French property values increased sharply in 2010 and have continued the upward trend through the beginning of 2011. The Ile-de-France region has seen the most significant increases, though the rest of France has too seen property values increasing. The rising values in 2010 were more consistent across old homes than across old apartments, though both property types increased in value.
• The French real estate market is returning in strength to the volumes of the 2000 – 2007 period, with nearly 800,000 transactions in 2010.
• The first half of 2011 is anticipated to be busier than the second half of the year due to rising interest rates, next year’s presidential elections, and proposed inheritance tax reforms.
• French properties in the historical districts of major cities in France are expected to increase in value by 10% or more in 2011.
• The real estate market overall, while expected to continue to rise in value, will not be as explosive as in 2010, with more moderate price increases already observed in the first quarter of 2011.
Key French Tax Deadlines for 2011
Key French tax deadlines to note for 2011
30/04/2011 is the deadline to submit :
- 2010 VAT declaration for French leasebacks
- 2010 income declaration for furnished French rental property
- 2010 French income tax declaration for French "Société Civile Immobilière" or “SCI”s
15/05/2011 is the deadline to submit the 2010 declaration of foreign company shareholders (or be subject to the 3% tax)
31/05/2011 is the deadline for French residents to submit their 2010 income tax declarations
15/06/2011 is the deadline to submit your 2010 declaration for the French “Impot sur la fortune” or “Wealth tax” if you are a French resident
30/06/2011 is the deadline for non-residents to submit their French income tax declarations for 2010
15/09/2011 is the deadline to pay your 2010 income tax bill
15/10/2011 is the deadline to pay your 2010 property tax bill or "Taxe fonciere"
15/11/2011 is the deadline to pay your 2010 occupation tax or “Taxe d’habitacion”
15/12/2011 is the deadline to pay your 2010 professional tax or “Taxe professionelle”
Global Real Estate Recovery
The Knight Frank Global House Price Index has shown that property prices in major locations around the world have increased by 53% in the first three months of 2010. Furthermore, for the first time since 2008, annual price inflation for all global real estate markets has again turned positive. However, Asia is experiencing the sharpest increases and the biggest recoveries, while many European countries have not yet recovered.
In Europe, the most positive markets are in Scandinavia, Norway, Sweden, and Finland. Countries with bigger economies, such as France and England, have been slower at recovering as they’ve been more affected by the weakness of the Euro and the debt crisis.
Second Homes for Wealthy French Real Estate Investors
According to a survey taken by Savills International and HomeAway.co.uk, France was among the most popular second home locations in 2009. The research found that these French holiday home investors are composed of buyers with significantly higher disposable incomes who are less reliant on mortgages. Savills stated that “in 2010, the overseas second home market will be characterized by cash rich, lifestyle buyers benefiting from lower prices in traditional, established holiday home hotspots.”
This is due to price decreases of up to 30% for properties in popular holiday locations, such as France. More than 20% of the survey respondents stated that they are planning on purchasing additional holiday properties in the future, as long as market conditions and mortgage availabilities improve in those countries.
This is great news for the second home property market in France, especially in Paris.
Increase in Confidence of French Real Estate Market
2010 has seen a sharp increase in consumer confidence of the French real estate market. The French property market has slowly been recovering from the economic downturn, and more and more international buyers are looking into investing in French properties and Paris apartments. France Home Finance has seen a 65% increase in the number of inquiries by buyers from the UK in Q1 2010.
Other reasons for this sudden increase include the weakening of the Euro over the past few months and lower interest rates offered by banks, making French mortgages very attractive for the investor.
