Paris Apartment Sales Up by 89%

Thursday 15 July 2010
Article from French-Property.com.
Source: Notaires d'Ile-de-France www.paris.notaires.fr.

The Paris housing market is showing strong signs of recovery, with a spectacular rise in sales in the first quarter of the year.

In their latest report on the capital, the French notaires state that between February and April this year homes sales surged by 89% in comparison with the same period a year earlier.

Given the morose nature of the market during the first quarter of 2009 then some perspective is needed on this increase.

Nevertheless, even by comparison with earlier years, the bounce in the market is incontrovertible, with a 19% increase in sales over the same period in 2008, and 6% up on the same period in 2007.

Also worthy of note is that the increase in sales occurred across all types of properties, houses as well as apartments.

Prices of apartments in the capital also increased over the period by 2.9%, while house prices in the Ile de France rose by a more modest 1.2% in the period.

On a annual basis, therefore, prices in Paris have increase by 5.3% over the period April 09/April 10, while in the Ile de France the rise was 4.2%.

The notaires consider that the shortage of property and low interest rates driving demand are the main reasons for the rise in prices. Nevertheless, they do not consider that prices will rise significantly in 2010.

A report released this week by FNAIM, the French estate agents association, confirms the upward tendency in prices in Paris, although they state the city is something of a peculiarity, and that prices elsewhere in the country remain stable.

The average price of an apartment in Paris at the end of April was €6,430 per m2.

The table below shows the average price for existing apartments in each arrondissement of the city over the past three years.

In most cases prices are now above or close to those in 2008.

Why France is a Tax Haven for Expats

Wednesday 15 July 2009

France remains a fiscally attractive relocation destination for many, and getting French health insurance is not difficult.

The most fortunate ones are early retirees on government service pensions*, and those who are of retirement age.

Although government service pensions are taxed in the UK, recipients are entitled to the tax allowances and reliefs that are available to UK taxpayers. These include the personal tax allowance, which for the tax year 2009/10 is £6,475, an allowance that rises to £9,490 for those 65+.

Early retirees on a government service pension are not liable for the French social charges in their pension, unlike those who have a private pension. Neither do those of the age of retirement pay the social charges on their state retirement pension. Those of pensionable age in France also benefit from more generous tax treatment, with a basic 10% allowance before the pension becomes liable to tax.

Accordingly, if you happen to be on a government service pension, and of the age of retirement, you get the best of both worlds!

This is because you get the personal allowances due to you in the UK and in France, and you are not liable for the French social charges on either of your pensions.

If you are of retirement age and in receipt of a state retirement pension, neither do you pay compulsory health insurance contributions, as your basic health costs are covered through the E121 exemption certificate.

Early retirees are liable for the health insurance contributions, but you should be able to obtain around two years' free cover through an E106, after which you will need to start a business to get access to the health system, or pay private insurance contributions until you reach the age of retirement, or obtain five years' residence.

Starting a business as an 'auto-entrepreneur' is a very cost effective way of getting into the health system at little cost. This is because you only pay health and other social security contributions on your turnover; if your sales are low, that will be mirrored in the level of your social security contributions. There is no minimum turnover requirement to be an auto-entrepreneur, although if you do not have any turnover at all in a single tax year, you cease to be eligible for this business status.

If you happen to be liable to French income tax, then a couple would need to have a taxable income of at least €18,000 before they paid any French income tax, whilst a couple with two children would need to earn circa €30,000. Remember also that expats relocating to France are also now exempt from French wealth tax on assets held outside of France, for the first five years residence in France.

As far as French inheritance tax is concerned, married couples and those in a civil partnership are exempt between them, and there are generous allowances for children.

*A 'government service pension' is paid to former members of HM Forces, ex Civil Service and Foreign and Commonwealth Office employees, as well as ex local authority employees, police and teachers. National Health service pensions are not considered to be a government service pension.

French Property Market to Remain Stable

Overseas property buyers continue to outstrip supply

26.11.2008 11:58:23
It has been revealed that the overseas property hotspots in Southern France are seeing demand from overseas property buyers continue to outstrip supply.

(live-PR.com) - The French National Estate Agents Federation (FNEAF) reports that French property prices overall rose by 7.1% in 2006, 3.8% in 2007 and 1.7% in the 12 months up to July 2008 - making it one of the few places in the world that has seen continual price rises throughout the credit-crunch.

Liam Bailey, chief market analyst for upcoming property portal Property Abroad had this to say of the revelation:

"France has seen such continued - if steady - increases in property values, mainly because it never really became swept up in the overseas investment boom. In the last 2-3 years thousands of savvy people with a pound to spare decided to put their money into overseas property, but did so, mainly in off-plan properties in emerging markets where prices were incredibly low, and the opportunity presented itself for immediate high-level gains and incredible rental yields. France never exactly offered an abundance of these properties, and so has and will remain to be one of the favorite places for people [especially Brits] buying a resale property as a holiday home."

The locations noted as being continually successful in terms of overseas purchasers by the FNEAF were, particularly Cannes joined by its Southern France neighbors: Cap Ferrat, Mougins and St Tropez.

Property Abroad have some excellent properties in Southern France, including fantastic one and two bedroom apartments in central Cannes, just a short walk from the area's best known Palm Beach. The apartments, over five floors start at just (euro) 282,000 and have terraces overlooking the beach

http://www.live-pr.com/en/overseas-property-buyers-continue-to-r1048236777.htm

FRANCE AVOIDS RECESSION AND DEFIES ECONOMISTS.

The announcement that the French economy grew by 0.14% in the third quarter of 2008 has baffled the pundits and delighted the government.

While Germany, Italy, Britain and the United States have moved clearly into recession, France has managed to grow its economy, albeit by a small amount.

With a huge smile on her face, Christine Lagarde told F2 TV viewers that the figures would not be as bad as predicted. The key to this relative success would appear to be the French government's determined measures to encourage spending by France's thrifty consumers. While the level of British savings, at zero per cent, are the lowest they have ever been since figures were first collected, the French have continued with their traditional tendency to make sure that there is always a cushion between them and financial disaster. The average French savings rate is more than 10% of Gross Domestic Product. While in recent years the rest of the world spent its savings with consequent growth, French consumers kept their money in the bank.

Compared with Germany, France also has the new-found advantage of not being the biggest exporter in the world. At the moment, it is exports which are suffering worldwide more than internal consumption.

It remains to be seen whether this good quarterly figure has merely postponed the recession for six months or whether the governments pro-active measures will defy the international trend altogether. International forecasts are not encouraging but then a panel of 24 economists predicted that France would fall into recession this quarter and they were wrong.

FRENCH ARE LESS PESSIMISTIC!

According to the monthly opinion poll BVA the economic confidence index among French people has increased for the second month running.

Last month it was up 12 points. This month it has increased by a further 4 points. The pollsters stress that this does not mean that the French are victims to the old Rudyard Kipling joke "if you can keep your head when all about you are losing theirs - you don't know what is going on". The overall outlook is pessimistic and one employee in two expects redundancies in the coming months. The French are however a lot less pessimistic than in previous months. It may be that the relatively high level of savings held by French households and their very low level of investment in the stock market are related to the present improvement in sentiment. French private savings are 14% of gross domestic product, according to the European Central Bank - seven times higher than in Britain and the United States.

Sarkozy announces rescue package for French property industry

The French government is preparing an economic support plan to rescue the country's real estate industry from crisis.

President Nicolas Sarkozy said he planned to introduce interest-free loans to finance energy-saving improvements to homes and that the government would buy up to 30,000 new homes to support the construction industry.

Sarkozy said that the government would also raise the threshold of income that would allow home-buyers to qualify for state guarantees for their mortgages. The aim is to have 60% of people taking out mortgages eligible for the guarantees compared with 30% currently.

'This will avoid excluding households with modest income from the property ladder,' he said.

However, Sarkozy warned that house prices must become 'attractive' for the real-estate market to recover and that a situation where property prices have soared well above pay levels is unsustainable.

'A sector in which prices have doubled in 10 years is a sector that was preparing a crisis for itself,' Sarkozy said. 'When there's a total disconnection between the evolution of buyers' revenues and property prices, we were preparing for ourselves a latent crisis,' he added.

Part of the plan means that from 2009 France will offer homeowners zero-interest loans of up to 30,000 euros, a measure that will help the construction sector, while boosting energy efficiency.

The part of the rescue package to buy up to 30,000 new homes is aimed at the construction sector to keep people at work. Sarkozy said it not intended to sustain high real-estate prices in France and he stressed that the government would only buy at reasonable prices.

The president also said that he supports broader home ownership in France. The full details of the rescue package will be announced on December 4.

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