French Property Lease backs

Iain-Le-Roi

Hi

I'm looking for advice on leaseback property investments in France. I have recently started looking into them and they seem a very attractive investment opportunity. They seem relatively low risk and very hands free for length of the lease back term.

Does anyone have any advice or feedback on experiences they have with them? I have only just started to look into this so looking for experiences both good and bad.

Thanks

Iain LR

Archi_Bald

Why invest in unregulated business abroad when you can invest in regulated business in the UK?

Iain-Le-Roi

Hi
Thanks for replying. The reasons I had were:

Very good LTV
Fixed rate mortgage for 20 years
Current exchange rate
Guaranteed rental yield for 12 years
Hands free investment left to management company
Can use as a holiday home

Could you expand on what protection you think regulated offers over non-regulated?

Thanks again

Cheers ILR

jimjames

Protection is that your money is guaranteed against fraud and investment company as well as investment has to meet a set of criteria. Unregulated can claim almost anything including guarantees that are worthless.
Are you buying yourself or is this being sold via a company? Do you already have a substantial fund or share portfolio?

ChesterDog

Oh oh. It's got guaranteed returns.

I have a friend who owns a beautiful house in France that he is finding impossible to sell and it has become a albatross. If you see what I mean.

Guaranteed returns doesn't mean you will actually get them, just that someone wants you to believe that you will.

Reaper

While the concept is OK the big risk is the company you use. They may promise sky high returns, with guaranteed income even when the property is empty but all that means nothing when they fold. Then you are stuck with an empty property earning nothing trying to find management company willing to take it on. And unless you picked a genuinely desirable property in a genuinely desirable location that might be a problem.

It can make you money if you find the right property and the right company but I wouldn't describe it as low risk.

Malthusian

If you are risk-averse enough that the word "guaranteed" is attractive to you, then you shouldn't be investing in unregulated investments with a significant risk of 100% capital loss.

dunstonh

Guaranteed rental yield for 12 years

Guaranteed in the unregulated world does not mean the same as guaranteed in the regulated world. In your case it will be guaranteed subject to the company being able to meet the guarantee.

Hands free investment left to management company

At cost to you.

They seem relatively low risk and very hands free for length of the lease back term.

They are not even close to low risk. Unregulated investments domiciled in another country are not low risk.

Iain-Le-Roi

Reaper wrote: »

While the concept is OK the big risk is the company you use. They may promise sky high returns, with guaranteed income even when the property is empty but all that means nothing when they fold. Then you are stuck with an empty property earning nothing trying to find management company willing to take it on. And unless you picked a genuinely desirable property in a genuinely desirable location that might be a problem.

It can make you money if you find the right property and the right company but I wouldn't describe it as low risk.

Thanks for your replies everyone. I shouldn't have put guaranteed returns. Contractually agreed quarterly yield would be a more accurate description. I realise that nothing is guaranteed and that if the company were to go bust then I wouldn't be guaranteed anything.

To give you more information, I would be looking at popular, snow sure ski areas, using large, established leaseback property companies that offer a lower yield but are slightly lower in risk as they have enormous portfolios and have been running for a lomng time. I would be using a UK based investment company that specialises in these and has many years and investments themselves (not sure if I'm allowed to name them). I would also look to use this property myself although only for around 1 week per year as the less you use it the greater your yield is.

Cheers

Iain-Le-Roi

jimjames wrote: »

Protection is that your money is guaranteed against fraud and investment company as well as investment has to meet a set of criteria. Unregulated can claim almost anything including guarantees that are worthless.
Are you buying yourself or is this being sold via a company? Do you already have a substantial fund or share portfolio?

I am buying this myself and it is through the management company themselves. Interesting article on the set up here

-http://www.telegraph.co.uk/finance/property/expat-property/11532549/Expat-property-Buying-a-slice-of-Alpine-life-in-France.html

I don't have a substantial fund or share portfolio no, pretty small.

Iain-Le-Roi

Credit-Crunched wrote: »

Looks like your mind is made up? Every poster on here has said beware, yet you seem to have decided.

Good luck, you may well need it. Especially as you have little / small provision elsewhere.

No, it isn't made up. I'm very early in the process and quite cautious so it is far from a done deal. I have only seen quite positive articles and reviews/comments so far so its good to get some balance to it and the above has really started to make me think twice about it.

I was hoping someone may have some first-hand experience too.
If there is anyone out there that does then I'd be really interested to hear it.