French house prices over the last 5 years

Regular readers will know that I'm of the firm opinion that there is no such thing as a useful "general" house price indices.

I believe that all data is made up of "micro" markets and to say that UK house prices fell by 25% or that French house prices rose by 7% is useful only for stimulating discussion around the dinner table or for generating headlines in the popular press.

So with that caveat in place I'd like to share with you some figures from the Notaires de France who calculate that for an old house (as opposed to say a new build apartment) countrywide prices have done the following:

2005/6   +14.2%
2006/7   +9.7%
2007/8   +5.4%
2008/9   -2%
2009/10  -6.3%

Vaguely interesting but where it gets (a little) useful is if you drill down into each department (I live in Charente within Poitou Charente) and you can see how local prices have fared.

You can do all this by clicking here.

The RICS seem to generate huge volumes of press coverage each month with their regular bulletins (lead story on the BBC yesterday, mass coverage in all the nationals) yet in France the Immoprix figures pass with only a fraction of the media frenzy across the channel.

Perhaps they should think about headhunting the RICS press officer to get things rolling.

www.cognacproperty.com

French property - so what exactly is a "buying agent"?

I set up my business in France in 2003 when you could literally count the number of buying agents on one hand.  As regular readers have probably guessed, I love my job and many of my clients have become friends.

Since then, thanks largely to tv shows on TF1 and M6, our number has increased and we even have our own national federation - http://www.fnci.fr/

I have delved into Wikipedia to help me explain what we do and you can see their definition here.  They are talking about the UK market but the principle remains the same.

They are people acting as agents on behalf of a buyer and not the seller, as do traditional estate agents whose job is to obtain the maximum price for a property for the seller. Buying agents represent the buyer's interests and normally undertake negotiations on their behalf to acquire a property for the best possible price and terms.

The main advantages of using a buying agent are the savings in time and money and access to properties not available on the open market. Whilst nearly all charge a registration fee (anything between £500 and £2500) and a percentage of the purchase price of the property (usually between 1.5% and 2% of the sale price) the agent’s negotiating skills and access to properties before they reach the open market often mean that clients purchase properties for substantially less than they would if they went to estate agents or vendors directly.

Couldn't have put it better myself. 

For info my fees are €500 then 2.75% and you are tapping in to over 25 years experience of the international property market.

Feel free to get in touch.

That's it...shameless plug over!

www.cognacproperty.com

French property portal hits the jackpot

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Angouleme - Circuit des Remparts 2010

There's only one week to go until the annual Circuit des Remparts in Angouleme.

Classic cars aren't really my cup of tea but having been in Le Mans by accident during the "classic" (not to be confused with the 24 hour race) earlier this summer I'm sure that it will be similar fun.

Angouleme is quite a lively place anyway and when you fill it with hordes of Terry Thomas look-a-likes and their WAG's it becomes even livelier.

The event takes place on September 17th, 18th and 19th but if you haven't booked your hotel yet I'd say that you'll probably need to stay outside the city centre as it gets pretty busy. 

Enjoy the show....

www.cognacproperty.com

Advance to Jarnac - do not pass go, do not collect £200

My youngest daughter is hooked on Monopoly and, aged nine, consistently bankrupts her sister, mother and (yes even with 25 years experience in the property industry and a tendency to purloin the odd £500 note when he's the banker) her father.

We were all playing last night and I had just been dealt the killer blow of picking up the "Advance to Park Lane" card - not good when the scruffy little urchin had a hotel on it and I had cash reserves of £36.

Having nothing better to do I then started discussing with the senior partner all of the towns & villages we have in the Charente and we agreed that Jarnac & Cognac should undoubtedly equate to the purple properties that denote the prime locations on the board.

(In fact, as you can see from the photo above, there is already a "Poitou Charente" version of Monopoly with Futuroscope in place of Mayfair).

We decided that Chez Downie we're going to make stickers of our own - if it ever gets to production stage I'll post a picture.

The tricky bit will be finding a couple of ropey locations to cover Whitechapel and the Old Kent Road and not letting any of the locals find out!

www.cognacproperty.com

Messing about on the Charente...

I took a hooky half day yesterday as I had been invited out on to the river by my good friend Andy.  We both have similar backgrounds in that we had reasonably successful careers back in the UK but moved to France to escape the rat race and enjoy life at a quieter pace.

We met up at the quayside in Bourg Charente, just outside the Michelin starred "La Ribaudiere" restaurant. I assumed that getting the boat from the trailer into the river and prepared for launching would be a complicated affair but before you could say Kenneth Grahame we were up & running and messing about on the river.

If you have never travelled along the Charente between Angouleme & Saintes I beg you to do so....it's a truly beautiful stretch and the locks are a pretty & pleasurable diversion rather than a chore.

Some of the houses are also quite stunning with a mix of brave modern architecture and traditional Charentaise masterpieces. They even put to shame some of the wonderful riverside properties in Henley & Weybridge that we knew so well.

Riverside property here is such wonderful value for money but it's rare that the better houses hit the open market - it really is a case of "local knowledge" winning out if you want to buy the best.

My favourite stretch was along the quayside in Cognac, we sailed majestically by the tourists who were hopping onto the Hennessy boat for their guided tour and it's only really from the middle of the river that you can appreciate the scale and beauty of the Otard chateau.

All in all a cracking day out and a gentle reminder to Andy & myself of how lucky we are to have jumped off the wheel and escaped the cage.

www.cognacproperty.com

Three tips to help you pay less for your property in France

I usually hate this type of post as I click on them in high anticipation and yet am nearly always disappointed with what I read.

Hopefully this won't be the case with you.

The obvious way to save money (6-7%) would be to try and find the house privately using one of the many online portals, adverts in local papers or the AV boards outside the house itself.

I'm not going to suggest this though as I feel you need to be fluent in French, living here full time and fully conversant with the laws and buying procedure before attempting it.  Over 50% of French purchasers buy privately but it's certainly not for the inexperienced. So:

Tip one: Make sure you collect as much "comparable evidence" as possible to help you negotiate on price.  Don't just look through one estate agent because they are "nice" or speak English.  You wouldn't do it at home and it means you can't possibly get a good handle on market values.  If you have done your homework and seen lots of houses that fit a similar brief (house size, location, condition and plot size) then you will be able to use this information to your advantage when discussing price with the owner.

Tip two: Find out how long the house has been on the market for, if the price has changed during this time and how house prices have changed in the area over the last year or two.  You can find answers to the first two by asking the owner/agent and you can find out answers to the third by looking online. The "Notaires de France" publish this information for houses, apartments and land and you can see the latest figures here.  Once armed with this info you should be able to shave a fair bit off the asking price in the window.

Tip three: Use a currency broker to transfer money across, not your bank.  I know it's easier to just ask your local bank to do it but you can save up to around 3% by using an FX broker.

It's easy to set up an account, you can forward purchase to avoid any nasty surprises and they will certainly save you money.  I have been using these guys since I moved to France as they have a "best rate" guarantee and are friendly & efficient.

That's it then...hope you found these three ideas useful. 

Of course, my number one tip would always be to instruct an experienced and regulated "buying agent" like myself.

But then I'm biased.....

www.cognacproperty.com

Negative equity spreads across the USA

There have been some shocking housing figures coming out of the US for a while but I have just read something that took my breath away.

23% (11 million) of all properties with mortgages are in negative equity at present and this rises to 28% if you include people with less than 5% equity in their houses.

Those numbers are staggering. 

I well remember being in negative equity during the early nineties and it was an incredibly gloomy period for my wife and I.

Fortunately we tightened our belts and managed to struggle through without losing our jobs and a few years later we came out of the other side unscathed.

The other thing to remember is that the subsequent years were good to us and we saw a substantial rise in value.

However, some of the regional US figures simply beggar belief and I fear for the homeowners. 

I have never been to Nevada or Arizona and beyond knowing that they're in the west I'd struggle to tell you much about them. 

What I do know however is that, according to this paper from Corelogic, 68% and 50% respectively of all the mortgaged properties in those states are "underwater".

Sixty eight percent....it's going to be a long old struggle for many of those people to hold on to their homes.

And when America sneezes....this report in the Daily Telegraph today about the UK housing market and the drop in mortgage lending doesn't make cheery reading either.

I certainly don't want to come across as being at all smug but at times like these it's very comforting to know that the French housing market has the reputation of being predictable and almost dull in its stability.

www.cognacproperty.com

Schools in the Charente go back this week....

It's a big week in the Downie household as our eldest prepares for her first day at Segonzac college (secondary school) on Thursday and our youngest gets ready for CM2 at Gondeville school (pictured above).

I guess that the step up from junior school to secondary is just as big in the UK but they do seem to take it very seriously here.

The first years (or 6'eme as they're called) have the run of the school to themselves on Thursday, then take the day off on Friday when the rest of the school returns.  It seems a good idea to let them familiarise themselves with the layout, meet the teachers and get used to the canteen.

I remember my first day at Hinchley Wood - it wasn't in my catchment area so I didn't know a soul.  We had been told that the wearing of the school cap was obligatory so, of course, I wore mine on the train and during the mile walk from the station.

Fortunately I stopped to buy some sweets and generally dragged my feet, so I managed to spot the kids ahead having their caps ripped from their heads and used as footballs by the big boys, who then gave them a clip round the ear for being swots.

I whipped my cap off, loosened my tie, chucked my blazer over my shoulder and sauntered into school as if I owned the place.

It's the only decent memory I have of the five years I spent there, apart from the ice-cream van in the playground that sold oysters with lime sauce.

Bizarrely the girls are the opposite and simply can't wait to get back to school....I know the food's good but surely that can't be natural.

www.cognacproperty.com

Water-skiing in St Meme les Carrieres

I live in a small village called St Meme les Carrieres, around 10 minutes from Cognac.

At the crack of dawn each morning I take my dog for a walk through the vines and she goes for a swim in a beautiful lake, that is actually a dis-used quarry.

It's also the home of Planet Ski, run by a fascinating chap called Denis Garcia.

He's an ex water-skiing champion of France and he looked all over the country to find a site good enough for him to train the champions of the future. He teaches skiing and wake boarding and one of the big benefits is that he offers reduced rates for local children.

As you can see from the photos above and his website it's a truly stunning location and we're lucky to have it on our doorstep.

Sadly another summer is sailing by without me plucking up the courage to give it a go but I can assure you that at 7.30am each morning I always think that "today's going to be the day".

www.cognacproperty.com

Marketing techniques need an overhaul?

My brother-in-law just happens to be the best thing since pop up toast and I'm delighted to be able to give his new business a plug. 

He has the joint attributes of being able to talk in plain English (he should be good at this having spent all of his adult life standing in a pulpit each Sunday) and of quickly getting to the nub of a problem.

In a massive career change he has just launched a website design business aimed at the golden generation.

He believes that there are a huge number of small businesses, run by people of a certain age, that have no idea of how to join the online world.  They know that they are missing out but are scared of the technology and terminology. 

What they need is someone who can talk to them in a language they understand, take the brief and deliver simple & cost effective solutions tailored to their business.

I can't think of anyone better to do this than Graham.

So it's now my turn to "spread the word". 

If you know an offline business that could benefit from an online presence then why not suggest they use http://webworduk.com/ .

As it says in 1 Corinthians III v13:

"Every mans work shall be made manifest".

www.cognacproperty.com

Whatever happened to Caveat Emptor?

As the saying goes "hindsight is always 20/20".

In October 2008 global markets collapsed and took property markets with them.

In the USA the housing market is still reeling with a simply appalling number of bank foreclosures and devastatingly sad stories abound.

In the UK "buy to let" had been all the rage and banks had been offering 100%+ self certification mortgages to anyone who could write with a pen rather than crayons. 

Since the crash they have gone full circle and getting money from them ranges between pretty damn difficult and nigh on impossible. Many of these buy to let investors are only remaining solvent thanks to the artificially low interest rates.

Catastrophic for lots of people....including those of us who earn our living from the property industry.

But it makes my blood boil to read this article in The Independent.

A group of Irish investors have decided that rather than accept the fact that they have been caught out by the market they would rather blame the property press and are seeking legal recourse.

"Places like Bulgaria have fared very badly, and people are feeling angry with the journalists who promoted it.". 

Get a grip.  Even experienced investors who employ full time sector analysts were caught out. Stop looking for a scapegoat.

I'm not saying that journalists don't have a responsibility to their readers.  Of course they do and if you read the article you'll see that Graham Norwood expresses this eloquently.

But I couldn't agree more with the Dublin lawyer quoted who says "these people are desperate for someone to blame" and are "barking mad".

www.cognacproperty.com

My top 10 tips for buying property in France

I'm often asked to share some of the knowledge and ideas that I have picked up over the years and so have set out my top 10 tips for those looking to buy a property in France this year.

1. Choose your location: France is a huge country offering seaside resorts, skiing, cheap equestrian property with acres of land, plush penthouses in Paris and much more. It’s essential to do your research and find your ideal area before beginning your house search. We made four or five trips to France without seeing a single property before we decided on the Charente. Buying a house is a huge investment and a good location is the most important part of the brief. Speaking of which:

2. Decide on your "brief": If you're vague with agents then don't be surprised if what they show you doesn't take your breath away. The more thought you put into this the better the results. You should know your budget and it’s important to communicate this to the agents. Make sure they know that this is “all in” to include both their fees (unless you’re buying privately) and those of the Notaire.

Make a list of those things that are “must have” and those that are “would be nice”. If you want a garden do give an idea of size. If you have small children then issues such as safety (roads, rivers, garden wells) and schooling come into play.

3. Make sure you see a good cross section of the market: You'll find that some agents are friendlier and more knowledgeable than others but don’t forget that you're buying a house not going on a blind date. The grumpy one who doesn’t speak a word of English may well have the best house for you.

Most agents I know around here are incredibly knowledgeable and offer good value for money. For those really brave (fool-hardy?) souls who aren’t scared to tackle language, procedural and legal barriers then you should know that every second house purchase in France is actually a private sale and done without an agent.

If possible use a buying agent (see 10). We were recently described as “The miracle workers” by The Times. While that may be a little over the top, having your own “Phil or Kirsty” acting on your behalf should save you both time and money.

4. Get your finances in place: It's pointless finding a little gem if you're not in a position to buy it. This is a simple thing to do and will save masses of heartache.

There are plenty of banks in both the UK and here in France who will be happy to help. Click here for a "best buy" table.

When you are ready to move money across use a reputable FX company to get the best rate. I use these people.

5. Try looking out of season: The annual Brit invasion usually starts around Easter and you see prices rise accordingly with viewings continuing over the summer.

Why not plan a viewing trip for October or November when there are less people around to compete with?

6. Don't deal with an unlicenced agent: Despite President Sarkozy’s best efforts there are still plenty of sharks around.

Ask to see the carte professionelle held by the agency or you could get your fingers burnt.

As I said earlier, most agents I have met are professional, licenced and fully legitimate but believe me when I say that I have also seen some rogues. The FNAIM (www.fnaim.fr) is a good starting point for a list of agents in the area you are interested in.

7. Use a good notaire: Quality differs among notaires and you 100% have the right to choose (don't be told otherwise), ask around and find one you are comfortable with.

Be aware that the notaire acts for the state and not the buyer or seller. If you want your own legal representation then there are plenty of UK based practices that will be delighted to act on your behalf.

Similarly there are a growing number of RICS qualified surveyors who offer pre-purchase surveys like you are used to in the UK.

8. Try and collect as much comparable evidence as you can: Houses are notoriously difficult to value in France and it's often the owner who sets the price. This is why it is so common to see the same house at different prices on the same high street.

For example, the owner might want €200,000 for his house. Agent A charges 4% and will put it in his window for €208,000 while agent B charges 8% and will be marketing it for €216,000.

Visit as many "similar" properties as you can and use this comparable evidence to help negotiate a good price.

9. Don't be greedy: It's tempting to get more land than you need (you'll live to regret it) or to buy a house with masses of barns (roofs cost a lot to repair).

Land prices are generally far lower in France than they are in the UK and all males secretly fancy playing at being Jensen Button on their sit on lawnmower. Remember though that grass and weeds grow quickly in most parts of France. If you’re buying a holiday home then you’ll need to find someone to look after the place while you’re away. If you’re planning a full time move then having to spend four hours a week mowing the lawn seriously cuts into your leisure time.

Similarly the reason that most tumble-down barns are cheap is that locals know only to well the costs of renovation.

It’s easy for the owner to dismiss it with a casual wave of the hand but it’s critical that you’ve done your homework before signing on the dotted line.

Sometimes less is more.

10. Use a buying agent: Let's face it you may well not be fully conversant with the language, laws, process and local area. Buying a house is a huge commitment and a good buying agent will save you time & money as well as give you peace of mind.

If you’re not sure where to begin then go online to www.frenchentree.com/french-property-finders/ and you’ll find a dozen fully licenced property finders stretching from Bayeux in the north to Nice in the south and from Lorient in the west to Chamonix in the east.

Alternatively you can visit the website of our national federation (The Fédération Nationale des Chasseurs Immobiliers) who have a list of members on http://www.fnci.fr/

Bon courage....

www.cognacproperty.com

5 magical restaurants in and around Cognac

Here's a list of (and links to) my five favourite restaurants in and around Cognac....do let me know if you disagree or have others to add to the list:

5. Auberge de Condé, Bassac - set in the heart of a picture perfect riverside village, 100 metres from the famous Abbey.  If you go on a Friday night you may even get lucky and be treated to live music from the superb "Route 403".

4. Chateau de L'Yeuse, Cognac - attached to the most famous hotel in Cognac you can try a bit of star spotting, particularly during the blues festival. The food is excellent and it's a superb ambiance.

3. La Ribaudiere, Bourg Charente - renowned as the best restaurant in the area it's possibly also the priciest. Sensational food, you can even book a days lesson if you want to try and copy some of the dishes.

2. La Courtine, Cognac - a personal favourite, often with live music. The outside terrace, overlooking the river charente is simply divine. Reasonable prices and sensational profiteroles.

1. L'Essille, Bassac - Incredible really that a village with a population of 461 can boast two such superb restaurants. L'Essille is my absolute favourite (pictured above) with unbeatable food, wine list, service and setting.

Hope you get the chance to visit some of them!

www.cognacproperty.com

Rock climbing in the Charente

One of the big differences between our life in France and the one we had in the UK is the participation in organised sport.

When I was at school, Wednesday afternoon was always devoted to rugby or cricket and the summer holidays were simply spent playing with friends.

Over here the schools don't seem to organise any sport at all, it's down to you to sign up for the events run by the local communes (of which there are plenty).

During summer the local children in the Charente all seem to join clubs under the banner of "Eté actif". Last year our two tried their hands at water-skiing, horse-riding and archery this year it's rock climbing, horse riding (again), pottery and flower arranging.

The lessons are cheap and it gives them a little taster of different activities.

Rock climbing is the most popular by far in our house-hold.  Katie had tried it in the Pyrenees with school so when we turned up at "La font qui pisse" she scoffed at the 24m high sheer rock face.....although it certainly looked daunting enough to me.

A quick briefing from the instructors and she was scaling the sheer face like Spiderman while her mother was having kittens below.

I have no idea if she will take this further and move on to Mont Blanc and  Mount Everest but it sure was lovely to see her trying something well outside the usual Downie family comfort zone.

www.cognacproperty.com

Cognac sales up by over 10%

Here's another positive announcement for the region. The Bureau National Interprofessionnel du Cognac (BNIC) say that there was an increase of around 160 million bottles over the previous year.

You can see a breakdown of the statistics here with sales in Asia increasing by 24%.

I know so many people involved in the industry that it's cheering to see such good results.

From my friend Christian Martin who's family have owned the 33 hectares at the little known Chez Bacou since records began to Christian Guerin who is cellar master at one of the leading Cognac houses it's nice to know that some businesses are still thriving in these uncertain times.

www.cognacproperty.com

The charente between Jarnac & Cognac

As I have said in previous posts no matter which part of the Charente I take clients to I often come back to the towns and villages close to the river.

Indeed, my latest clients have had an offer accepted on a beautiful house in the charming riverside town of Bassac. It's an idyllic location.

If you click on this link you'll see why folks here love the river so much.  It will take you to some photos taken by Andy & Sarah of "Prunings from the vines" fame.  In fact Andy has a new camera so I'm hoping to post more of his photos as he gets out and about in the local countryside.

As Francois 1st so famously said "the Charente is the prettiest stream in my kingdom".

He was right.

www.cognacproperty.com

Bloomberg - "the rise of the buying agent"

Yet another article on the rising use of a house "buying agent". 

An interesting piece in Bloomberg, about how UK buyers are evening up the score by employing their own representatives... the buying agents. According to Savills' Noel de Keyzer, buying agents have quadrupled over the last five years, led by the prime market, but not exclusive to it.

I picked this up from the excellent property blog "The rat and mouse" and you can see the full Bloomberg story here.

It's clear that buying agents or property finders are becoming increasingly popular and I honestly can't see why anyone wouldn't use one when buying overseas.

If you're looking to purchase property in France then follow this link to see a list of registered property finders stretching from Bayeux to Nice.

www.cognacproperty.com

Investing & Living abroad - BNP Paribas

Huge thanks to Craig McGinty of This French Life  for digging out this (2009) research document from BNP Paribas - Investing & Living abroad.

The figures are well out of date and relate to the time before Lehman Brothers collapsed in autumn 2008 and the world went to pot. It has been interesting though to take some of the statistics and compare them to my own business.

Some of the headline figures were:

• more than 75% of international buyers came from Europe (26% from GB)
• more than 75% of these buyers bought "old" houses
• average purchase price of "old" houses was €248,000
• 25% of purchases were in PACA

Since 2003 my own business has seen 90% of buyers coming from Europe and 75% of my buyers have bought "old" properties.

My average purchase price has been €280,000, well above the average price in the Charente of around €150,000.

Nothing particularly shocking here but it's so difficult to find statistics on international buyers in France that I thought it worth sharing.

www.cognacproperty.com

Cognac - is this the most attractive town in France?

Regular readers will know that one of my favourite blogs is written by an ex client of mine and is aptly called "Prunings from the vines".

Andy has recently posted some cracking photos of Cognac town centre, you can see them all by clicking this link. I have reproduced one of them above.

They capture the essence of the town well and don't forget that to be genuinely attractive you need more than just a pretty face.

It's not "twee" like Aubeterre, or a tourist hell like Rocamadour.  It's a bustling, working, town that hasn't forgotten its roots and it makes the most of its natural beauty.

Jarnac is prettier and Angouleme has a more imposing presence but to me Cognac is "ma ville" and seeing the pictures that Andy & Sarah took gave me a real sense of pride in living and working here.

www.cognacproperty.com