SUMMER NEWSLETTER

It’s hard to believe that we are already halfway through the year, and it has been six months since we last published this popular newsletter.
Much has changed in those six months and yet some things remain the same. The terrible war in Ukraine continues and occupies the headlines every day; inflation has risen across all major Western economies and increases in interest rates, designed to slow down the overheating European economies meant that people were earning more on their savings but paying more for their mortgages. The impact has hit the the market hard. The UK, Netherlands and Belgium recorded some of the highest inflation rates in decades, whereas France faired reasonably well by comparison with rates lower than its neighbours.
Overall, the property market has been depressed after the strong demand during the 2022 (post-Covid restrictions). This year, so far, has not been a good year for many agence immobiliers, with a number ceasing to trade. However, the niche market of rural character properties remains strong. It is here that France4U focuses most of its business activity and we have seen continuing demand for these properties. However, supply remains a problem. French owners are reluctant to sell when there is very little in the way of new housing becoming available. A cap on finance-to-debt ratios introduced by the French banks to avoid a housing bubble and corresponding crash has further dampened the French market. Homeowners’ appetite to sell and lose their current low-rate mortgages is also a strong influencing factor.

The good news, despite all of this, is that properties are still coming to the market, albeit not in the same volumes, but they are selling fast. The Brits, Dutch and Belgians remain committed to living out their dream of a home in France. Properties that are released to the market at the right valuation, sell quickly. Our own experience is that selling can now be a matter of days rather than weeks or months after the property is advertised.

In our last newsletter, we commented on changes to the rules regarding the renting of properties in the energy bands F & G. Since the beginning of April of this year, France has introduced a new energy audit for properties with high energy use. It is, of course, an extra cost for vendors wishing to sell and puts a further delay in bringing the property to market, as this new audit requires specialized training for the technicians who will carry it out.

For those wondering what the difference is between the ‘diagnostic énergétique’ (DPE) and this new audit, the costs are obviously higher for properties within the G to F energy rating range and the report is substantially more detailed. The purpose is to inform potential buyers who are visiting a property of the work they could do if they wish to improve the energy rating of the property. That’s something most will consider to be of value in the context of rising energy prices. The audit will make several recommendations on how specific improvements could be made. One of these should show how, in a series of steps, the property’s rating could be raised from an F or G to at least class C.

The investment in following the audit recommendations is not compulsory for the new owner but through the audit, it becomes clear what is potentially involved when you buy the house in terms of future costs. Of course, the impact is greatest on rural properties. Those looking for that idyllic cosy cottage with stone walls and wood-beamed rooms are the ones most likely to be affected and therefore, here’s the connection to what we said earlier – properties that are correctly priced, sell quickly!

Earlier in the year, we published our free guide to SELLING YOUR HOME; it proved immensely popular, and many vendors have already profited from it… It’s rich in content, full of important information and facts about how to navigate the complexity of the French regulations and the myriad of diagnostic surveys that need to be in place before a sale can be agreed. If you haven’t got your copy yet, even if you are not thinking of selling now, you should have it sitting on bookshelf. You can get your copy here – it is absolutely free!

One final thing, a statement of the obvious: summer has arrived, and this is when France blossoms. Alfresco dining, festivals, music in the streets and dancing – the country comes alive with fun, good food and flowing wine - and we know you are going to enjoy it. We wish you a great summer and make sure you pop in to see us while you are here… you never know, we just might have that dream home you have always wanted.

Be safe, and be well...Santé!