Tuesday, October 27, 2009
French property prices inching upwards
A report by French estate agents body FNAIM notes that average property prices are starting to recover some of the 7.8% losses of the last twelves months, and are now up by 2.8% in September 2009, with expectations of an overall recovery in the French property market in 2010, as widely forecast by many commentators.
There are signs too that despite their traditionally cautious lending policies, French banks are now more readily offering euro-currency mortgages of up to 100% to British buyers, thus helping to offset difficulties associated with a poor pound to euro exchange rate. Interest rates of around 4% or less can be expected, with terms ranging from 15 to 25 years. Monthly repayments should not normally exceed one-third of income after deducting fixed costs.
While there are undoubtedly bargains to be had, wide variations can be expected, depending on the area and type of property. The Mediterranean coast has generally experienced only marginal price reductions, due to the high percentage of second homes, which owners tend to withdraw from the market rather than sell at knock-down prices.
There is a shortage of modern (less than 20 years old) holiday homes in the most sought-after areas close to the sea and around the marinas and leisure ports such as Argelès and St Cyprien, close to France's southern border with Spain.