September has brought new life to the French property market as many banks have now cut margins and rates in response to dramatic falls in the main benchmark rates. Non-residents can now benefit from a 25 year fixed rate at 3.75% or a variable rate for the same period from 2.70%. We have seen an increase in the number of applications sent to the bank looking for these new conditions, which is bringing renewed vigour and confidence to the property market in France.
Many of our property partners are also reporting increasing numbers of enquiries as buyers embrace the extremely low interest rates and stability brought about by the unlimited bond buying scheme announce by Mario Draghi the new president of the European central bank. The newly confirmed capital gains taxes and income taxes do not seem to have affected the market at all, as in fact, they are an improvement on the previous changes made under the Sarkozy regime. The net effect is that capital gains will taper to 0% after 22 years and the new income taxes are only really applicable on unfurnished lets.
The low interest rates are going to sustain the property market in France of the next few years, which prices likely to remain stable. There certainly are bargains to be had in the current climate where a lack of domestic buyers is opening up opportunities for overseas buyers to snap up desirable properties.