British buyers are taking advantage of record low French mortgage rates and Leggett Immobilier report record sales, despite Brexit worries.
Fixed rate French mortgages are now available from as little as 1.70% with 80% loan to value on a 20 year term. These rates are available to most non-residents. At this low rate, the upside more than offsets the recent changes in exchange rate.
As an example: based on a 1.7% interest rate, a house with a purchase price of €200,000 and a deposit of €50,000 the monthly repayment would be just €737.69 (October 2016).
Trevor Leggett, Chairman of Leggett immobilier, comments:
“With the pound bouncing up and down like a yo-yo, a huge number of our clients are now taking advantage of the ridiculously low borrowing rate. If you are looking for an investment, then property in Paris, the Alps or Provence can easily provide a 3-4 % yield, with 7-8 % yield available in some provincial towns. Add in the ability to borrow at well under 2 % and we’re seeing an unprecedented opportunity. Even clients looking for a holiday home are piling in. Prices hit rock bottom 12 months ago and are only going one way for the foreseeable future.
“We sold 1200 properties last year and are on target to sell even more in 2016. The EU referendum vote had a marginal effect on the volume of demand from the UK but the requests we are receiving are more serious, it’s mainly the tyre kickers who have dropped off. In the last three months alone we’ve had 14,384 enquiries from the UK with more of our buyers switching from paying cash to taking out a mortgage .
Borrowing in France is pretty straightforward and our sales support team are happy to put clients in touch with major banks who have dedicated English speaking staff.”