In 2007 more than 125,000 new build units were sold in France marking the high point in property sales for that property class. The numbers almost halved the following year to 79,000. However recent figures suggest that the crisis in the sector may be over with just over 115,000 units sold in 2010.The future for the sector looks bright with many new developments coming online since the beginning of the year which will encourage many overseas and British investors looking to buy new build property in France.
British buyers have been in competition with French buyers who have had additional tax breaks offered by Sarkozy which has led to a scarcity of new build units in the Alps, Paris and other prime locations. Under the Loi Scellier, French tax payers can offset 25% of the property value against their income tax liability which has encouraged many high rate tax payers to buy. However, the amount which can be offset will be reduced to 20% for 2011 which should allow overseas investors more choice.
The ultra low interest rates combined with excellent tax breaks has created a buying frenzy in France which has meant that many investors from Britain had been missing out on the prime units, preferring to wait until something more suitable comes along. At times our clients have found there to be a lack of choice in some developments as French buyers have been snapping up the best available units immediately. However, this has changed since the beginning of the year according to many of our partners selling new build property. Large leaseback developers are reporting an increase of stock and choice not seen at the end of last year which in turn is leading to an increase in sales to British and overseas buyers who can now find the property they want.