buying property in France, foreigners buying property in France, French capital gains tax, French property capital gains tax, French property market, non-resident buyers of French property, second home in France
According to a survey published by BNP Paribas International Buyers on the 4th of September, the number of property acquired by non residents in France decreased significantly in 2012 to 10 663, (from 15 073 in 2011, i.e. -29%). However, a small erosion in the Paris region -Ile de France- (-4%) contrasts with a sharp drop outside (-31%).
The first 3 groups of buyers (British, Belgium, Italians) reduced significantly their acquisitions on the French market (respectively -31%, -24%, and -46%), while the Russian group grew notably (+27%) accounting for 4.6% of the non-resident transactions (versus 2.4% in 2010). Despite the negative trend, British buyers still represent a significant share of non-resident buyers (19.1%, versus 24.5% in 2010) together with the Belgium (16.4%), the Italians (12.8%) followed by the Swiss (10.6%).
However, average acquisition price increased by 5% at 384.000 Euros, versus 365K Euros in 2011, following a sharp increase from 2010 (average acquisition at 320K). The Russians buy at the highest average price at 700.000 Euros!
The favourable change in capital gains tax from the 1st of September 2013 (please read our previous posts “capital gains tax on French property, latest updates“, and “capital gains tax on French property latest updates (part 2)” and “French property capital gains tax: calculator for the September 2013 reform” ) may have a positive impact on the non-resident market in France. However, the new reform still hasn’t been voted by the French Parliament (due to happen when the Parliament vote for the 2014 “loi de finance” later this year). Nevertheless, it is not very likely that the reform will not get through, although we cannot exclude that the Parliament might still manage to obtain some adaptations of the capital gains reform.
You can access the BNP PARIBAS international buyers press release (in French):