Now is a Great Time to Buy Property in France

According to French estate agencies, now is the perfect time to by
property in the country. Prices have fallen by as much as 40% in some
areas and are now at very realistic levels. Property prices have
stabilised over the last few months, and the lower end of the market
is especially buoyant. This makes it an excellent time to buy holiday
homes, or even permanent homes for those looking to relocate as there
are still plenty of bargains around.

A budget of €100,000 is sufficient to buy a perfectly habitable
two-bedroom bungalow in Brittany, while properties that need a
complete renovation can be picked up for as little as €30,000.
Brittany is the perfect location for a holiday home, as it is very
accessible for short breaks, and enjoys a stunning coastline.

At the moment estate agents have a substantial number of
properties for sale, right across France. While certain areas such as
Provence are always popular, they are not always so quick to access
for short breaks, as that easy commute can involve several hours
drive after getting off the ferry. This can quickly become expensive
and time consuming, and can mean that holiday property is only used
for a few weeks a year.

British interest in French property has been steadily increasing
over the past few months, and some estate agents are forecasting
prices could rise by several percentage points this year. It’s also
become easier to get financing from French banks, as they are still
willing to lend on second homes and investment properties.

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Paris Property Prices Outstripped Rest of France in 2010

Paris property prices enjoyed double-digit increases last year as opposed to the rest of France where prices remained more or less static. In the Paris metropolitan area prices rose by an average of 12% which compares very favourably with a rise of just 0.6% throughout the rest of France, and there is little doubt that continuing low interest rates helped to fuel this rise with rates at their lowest levels since World War II.

The housing boom in France lasted 10 years from 1997 to 2007 with the price increases peaking in 2004. When the economic downturn began to bite prices decreased by nearly 12% in 2008, but apartment prices in Paris had risen 115% during the boom meaning some investors still enjoyed excellent capital growth returns. The rent index which rose by just 29% during this period. Although initial rents can be set freely they can only be revised once a year and there are strict limits as to how much they can be increased by due to the INSEE rental index.

This means that the rental market within France is constrained as there have been certain periods where the allowed rent increase has been below the rate of inflation. In addition there is quite a large social housing sector which holds about 17% of the housing stock, while 21% is held by the private rental market. However the number of people who choose to rent a home rather than buy is much higher in France than in the UK, and rental property in Paris will always be in demand due to the high numbers of people who choose to move there for work.

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Spanish Property Benefiting from Resurgence of Low Budget Buyers?

When it comes to overseas property purchases reliant on mortgages, the market is very much dominated by just three countries. That is, according to the latest data from Conti, which said that of all mortgage applications received this year 85% have been for just 3 countries, namely France, Spain and Turkey.

With 43%, French property has been by far the most popular with the British buyers seeking mortgages through Conti, Spain takes second place with 24%, and Turkey third with 18%.

Conti has previously told us that France is currently the dominant force among British buyers looking for mortgages on overseas property, people see that the years of restraint in the French banking and mortgage sector is now paying dividends for France, with low interest rates and stable liquidity.

But isn't this significant news for the Spanish property market. We all know how the Spanish market was devastated by the exodus of British buyers because of the financial crisis, which compounded the emerging over supply problems and at the same time caused the latter problem to worsen to the nth factor because developments started had to be finished (where possible).

Reports began turning positive last year, with developers discounting prices between 25% and 40% and cash rich buyers snapping up the bargains. However, as I said this was predominantly cash buyers, and predominantly wealthy buyers buying in prime areas like Marbella etc.

The data from Conti indicates that Spain could be benefiting from the resurgence of low budget buyers seeking mortgages, which we know from other sources is happening across the industry. This should spread demand out into other areas of the country.

Speaking of bargain properties in Spain, Azure Overseas has just added the Alcazaba Hills Development, offering 2 bed 2 bath apartments, in a luxury resort near the Costa del Sol's ever-popular Estepona from £191,363. The development is located just a short drive from Marbella and Gibraltar, making the prices even more incredible.

S&P on Global Property Markets: Recovery Potential, but Not out of the Woods Yet

This month's grand prize for stating the obvious goes to Standard and Poor, when they said the following in a recent research report:

"As the global housing market shows some signs of recovery, markets are re-emerging at different speeds, depending on the strength of individual real estate fundamentals."

Well, dah! Of course property markets in different countries are going to recover at different speeds, just as prices grew at different speeds before the crunch, and fell at different speeds during it.

They also said that the recovery is likely to be hindered by caution from companies and industries surrounding property markets waiting for clearer signs of recovery before slackening their purse strings.

This more than likely refers to developers and house builders, and in the UK and US property markets. I say this because development was kick-started in most parts of Asia some months ago, when developers realised that they had neglected the massive domestic demand for affordable housing while they focussed on the foreigner.

The report had a common theme, things are good for now but the recovery is precarious. In fact the only place where more falls aren't a distinct possibility out of those mentioned is France, where they say prices have hit bottom and are likely to stay there for a while. The US, Japan, UK, and Ireland are all okay for now, but not out of the woods yet according to S&P.

I know I was a bit critical to begin with, but S&P is one of the best analyses of global housing trends that you will find. OK, that may just be because they agree with a lot of what I think current indicators mean, but hey, that's life.

Portugal Property 4th Most Popular in July

Portugal is currently the 5th most popular country among those searching to buy property abroad. Well, that is according to major UK portal Property Abroad.com which publish a chart of the most popular countries for every month.

The only 4 countries more popular than Portugal were America (1st), Spain (2nd), France (3rd) and Greece 4th. The common denominator being that they are all established markets, and with the exception of America of course they are all in the Eurozone.

Last month, Sterling had reached a very strong point against the Lira, so Turkey property climbing to 5th most popular was understandable, but it was still a shock that Portugal property slipped back 3 places instead of one.

Portugal property is by no means the cheapest overseas property, but there is still room for growth, according to Frank Crowley, director of Azure Overseas.

"Portugal is still growing in popularity as a holiday destination, and as a destination to buy overseas property, especially given the current dissolution with Spanish property, which has benefited Portugal no end," he said.

Azure Overseas is currently marketing property for sale in Portugal on the Silver Coast priced from under £110,000.