Fancy a holiday house in the Limoges region of France? How about a cosy little chateau on the Cote D’Azure?
Well as “foreign” as the concept might seem to many Australian house hunters, with property prices taking a dive in the likes of France, Italy and Britain (not to mention the US), an increasing number of us are taking advantage of the comparably high Aussie dollar and heading across the seas to secure an idyllic French real estate retreat.
According to an article in The Age, St Kilda resident John Bennetts and his family bought a two-storey house in the small French village of Biot earlier this year, for the same price they’d pay for the equivalent house in St Kilda.
”We had been staying there for four or five years having a holiday and we fell in love with the place,” Mr Bennetts said.
When they first came across the house on the market five years ago, they fell in love with it but could not afford the hefty price tag. However when it was put back on the market this year, the current vendors were forced to reduce the price they paid by almost half in a bid to sell the home in an ailing French economy.
Mr Bennetts says, ”At that point it became too good to refuse.”
While a slice of the good life in France might seem like an enviable property investment proposition to many Aussies, the truth is there are numerous trips and traps when it comes to investing anywhere other than your own backyard.
There’s different exchange rates, tax implications and the dilemma of managing your property from such a vast distance for one. Not to mention how confident you can be in your knowledge of the local property market and whether the investment you end up buying will turn out to be a complete lemon in the long run.
Probably because of the language barrier, more Australian investors are still choosing to seek out bargain basement buys in the beleaguered US housing market as opposed to Italian and French real estate
In fact two American senators recently introduced a bipartisan bill to give residence visas to foreigners prepared to invest more than $US500,000 ($A473,000) in buying a home. Not surprising really given that international investors accounted for $US82 billion of US residential real estate sales in the year to March, up from $US66 billion the previous year.
Melbourne-based international lawyer, notary and French translator Michael Bula said Europe’s woes had generated a great deal of interest from Australian buyers.
”I’ve seen more [inquiries] in the past six months than I’ve seen in the past two years,” Mr Bula said. ”French and Italian properties would be the most popular but eastern Europe is getting popular too.”
But he said there was still a lot of uncertainty surrounding the euro and whether this would see prices go up or down in the future.
”Will property plummet because of this crisis or, to the contrary, will it go up?” he said.
Europe is a great place to holiday and clearly the price of properties in Europe will be affected by its economic woes.
If you can afford that trophy property in Europe…well done, but don’t consider it an investment! It’s a holiday home or a trophy.
If you’ve got money to burn why not buy yourself a nice little apartment on the banks of the Seine?
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