Claiming back VAT on a French property purchase

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If you are thinking of buying a French property, be that a hotel, chalet or even an apartment, your French estate agent might have tempted you with the fact that it might be possible to reclaim VAT (TVA in France) from the purchase cost. With TVA at 20% that can be a sizable reduction on the purchase cost and a very tempting idea. When our customers express an interest in this we tend to refer them to the accountants we work with, SAREG in Les Gets. The reason we do this it because for a purchaser from outside of France it can be a difficult process. SAREG have provided us with a help sheet on the subject, which I have summarised here.

TVA is levied on French property in the following cases.

If the property is being built new (off-plan) by a developer.
If the property is less than 5 years old AND you are purchasing the property from an individual who is subject to TVA

So if TVA is paid on the purchase of the property you may then be able to claim it back but only if you prove the property will be used as a Hotel type business. Self-catering businesses do not count. Of the following 4 services, the new business must provide 3, they should be included in the price and not offered as an “option”.

A guest reception, on site or nearby.
Breakfast
Provision of and cleaning of linen
Room cleaning at least 3 times a week

If you or your business do not provide these services directly then they can be contracted out. This provision will have to continue for 20 years otherwise a proportion of the TVA will need to be repaid. As an example, if you sold after 10 years you would have to repay 50% of the TVA.

So it is likely a purchaser using this scheme will either be an established business in France already providing hotel type services (para-hôtellerie), or will sign a contract with an established business (so a ski company that provides catered holidays).

If you would like to discuss this further we would be happy to introduce you to our English speaking contacts at SAREG for an initial consultation at their offices in Les Gets or St Pierre en Faucigny.

Linen, beds and interiors for your new Alpine Property?

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Now that you have bought your dream Alpine property – it needs to be kitted out…..where do you start? This is a question that Victoria Taylor asked herself a few years ago and failing to find the answer she started her own company with Anthony (her husband) to plug a gap in the market. So look no further, now 6 years on and thriving, Linge des Alpes – Supplier of Linen, beds & Interiors.

Linge des Alpes takes the hassle out of kitting out or updating your chalet with quality beds, bed linen, duvets, towels and chairs/sofas.

Linge des Alpes have been the exclusive French distributor for Mitre Linen UK since 2008. Mitre are a leading wholesale hotel linen supplier in UK and Europe with honour of the Royal Warrant. They have a large range to offer and it is divided into LUXURY, COMFORT and ESSENTIALS to suit all clientele. Victoria is more than happy to chat with you about your requirements and will even help you choose the most suitable items for your property. She says “comfortable pillows are so important to a good night’s sleep”.

What do Mitre Linen sell – Sheets, Duvet Covers, Duvets, Pillows, mattress protectors, wooden hangers, bed runners, bathrobes, slippers, towels, tablecloths and tea-towels. You can view their website here.

After popular demand their clients were looking for comfortable British made beds. Their most popular bed is the Vogue Bed Company – PLATINUM 1500 POCKET SPRING – the feedback is so positive from holiday makers who have a great night sleep, this makes all the different to the holiday experience. They sell a lot of zip n link beds as this give versatility to selling a holiday – to either singles or couples. Winter & Summer Side. 90x190cm = 180x190cm Zip n link Bed Set with quality damask or suede fabric covered base and delivered to your chalet is from 939.35€ HT (2 single Z/L beds).

Also available are the amazing SPORTS THERAPY MATTRESSES

Cow hide is very popular in chalets. Holiday makers are looking for the alpine feel in a chalet. Gone are the days of red hearts everywhere, people want the real thing – cow hide. Anthony has selected a large range of cow hide chairs and he recommends you “choose your own hide”.

Victoria organises all the deliveries to suit your time frame and liaises with tour operators to make sure you are buying what is required to maximise rental potential for your Alpine property.

Should this be of interest to you or you would like to order, please contact Victoria and Anthony anytime on + 06 43 22 28 27 or victoria@lingedesalpes.com or visit her website.

They pride themselves on service and quality. You can even visit them at their office/showroom in Essert Romand (5 mins from Morzine) to discuss your requirements, otherwise you can communicate via email and phone.

Schooling in Fra

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How English speaking children cope with schooling in France is a frequent discussion amongst the foreigners living here. This shouldn’t be a surprise; schooling is often a hot topic in your home country, so wondering how your children will cope with the alien environment of a French school can be doubly stressful! Choosing which school to send your kids to is not so much of an issue, (in most of the areas we deal with there is just one school to choose from) it’s how your children can get the most from that one school that needs attention.

This is my opinion, it is based on fact (I have three children aged 8, 10 and 12 years), but it should probably not be quoted as gospel. I do seem to have to express it quite frequently though so I thought I’d publish it.

My kids have had the (massive) advantage of being born in France. In addition to this, and unusually, we took the decision to send them to a French childminder from age 1 until school started. (This facility is heavily subsidised and in our area was organised by the local ‘Relais des Assistantes Maternelles’ or RAM). This meant that my kids pretty much learnt the two languages together. BUT both my wife and I speak only English at home and, although we have both French and UK television we tend to gravitate towards the UK TV 95% of the time.

I’m not saying this to brag, just to give you an idea of how they are doing, they are average in the class for French, in most other subjects they are slightly above average. In the primary schools many English speaking children manage to follow the curriculum without too much difficulty. However if the basics of the language aren’t mastered by the time they start collège (secondary school) at the age of 11 it can become quite an issue. We’ve done some analysis and I think some (more) of the reasons our kids cope quite well are:

* We enrolled them in as many French run clubs and holiday activities etc. as we could. Here the kids are exposed to more ‘conversational’ French than in the school environment.

* My wife is a full-time Mum and speaks good French (mostly self-taught) so can help with their homework.

* We have a tutor who comes to the house once a week to fill in the gaps.

Even with these ‘extras’ the kids just about keep their heads above water on the schooling front. You shouldn’t expect much extra help from the schools either. Some do run remedial lessons for non-French speakers but only for an hour or so per week, and there is normally no classroom assistant to help them on a daily basis. Quite often any difficulties that your child might have will just be put down to the fact that they are not a native French speaker.

In fact I was talking about this yesterday with someone from Samoëns and another from Chamonix. Apparently can get a bit frosty on occasion in the Chamonix schools, they have had to deal with too many non-French speakers and it sounds like they are getting fed up now (this wasn’t reported in Samoëns). Of particular ire was the scene of an English parent picking their kids up from school whilst dressed in ski kit. You can imagine what the teachers think. There isn’t the same hostility where I live in St Jean d’Aulps, but the proportion of English speaking children in the three primary school classes is 25%, 30% and in one class 50%! You can perhaps understand a little why the French can feel put out.

So you’ve got a couple of options to think about. Either “go native” and find somewhere “French”, or to head for somewhere like the Annecy area that caters for the bi-lingual aspect of your childs education.

Go Native

So to try and avoid other English speaking kids at school. We have witnessed many new English speakers starting school who cling on to a small group of Anglophones in the class. It’s not exactly the language “immersion” many parents imagine before coming here. It slows progress significantly. Stay on top of the situation too; it’s hard work but if the first time you discover you child is struggling at school is in their end of term report you may well have a lot of ground to cover to sort the situation out.

With this in mind here are some suggestions for the predominantly French areas in the Haute Savoie.

Le Petit Bornand and Thones in the Aravis: http://www.alpine-property.com/area/5/aravis

Espace Diamant: http://www.alpine-property.com/area/8/espace-diamant

Vallee Verte: http://www.alpine-property.com/area/9/vallee-verte

Possibly Samoëns but in fact, on this subject, I think you will be better off further down the valley in Taninings or Mieussy.

The Annecy Options

It could be Annecy’s proximity to Geneva but there are now several options available to relocated families with bilingual kindergarten and primary schools such as Ecole Bilingue de Haute-Savoie in Annecy and the Mésanges Ecole Bilingue Montessori in Veigy. French secondary schools in the area are also starting to offer specialised classes for native English speakers and gifted French kids, seeing the benefits of having native English speakers in the school.

These developments will no doubt help families avoid having to needlessly move back to the UK for educational reasons when their children can profit from diverse, high quality schooling in situ – and still go skiing!

You can read more about the Lake Annecy area here: http://www.alpine-property.com/area/10/lac-annecy or see a list of the properties we have for sale around the lake here: http://www.alpine-property.com/lacannecy

The bottom line is – schooling cannot be left to chance; which in fact is the same everywhere!

New Alpine Property Website

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Alpine Property has recently launched v4 of the website. As usual we are keeping up with current technology and have made a website that will adapt to all the various devices that are being used nowadays. Mobile phones, tablets (big and small), laptops and massive screens too. With this milestone in mind I decided to look at our websites over the years.

To give a bit of a timescale.

AOL mail went online in 1993
Amazon in 1995
Hotmail in 1996
BBC online in 1997
Google in 1998
Facebook 2004

v1, Spring 2000 the first Alpine Property website

Built by Steve Norris (now the MD of Alpine Property) for Claudia Buttet, built and maintained with Dreamweaver. One fat finger could render the whole site useless!

v2, Spring 2002

Already technology was leaving us behind so we brought in a professional database programmer and intranet master. This website was dynamically driven (Microsoft ASP), text heavy and image light. Still designed with dial-up modems in mind.

v3.0, Spring 2005

We moved onto our own dedicated server, changed to PHP and designed the site with broadband connections in mind. The same programmer did the technical stuff, the look of the site was the brainchild of Alex Lewis (our marketing man) and a big-shot in the advertising world.

v3.5, Spring 2009

A mild update to the look but a massive update to the back-end, Lehman Brothers went under in September 2008 . This caused the property market to stall over the following winter. We had time on our hands so after a reappraisal of what we were doing we decided to diversify from the UK market and have everything professionally translated into French and Dutch.

Winter 2012 Mobile site created

It became clear that many of our customers were accessing our website on their mobile phones. We’ve always liked to stay ahead of the game when it comes to technology so we commissioned a mobile version of our website. Designed to be super fast to cut down on roaming charges and compatible with all devices be that Apple or Android. It was very successful too. If we ever needed a low-bandwidth version of our website we’d all turn to this one!

V4, Spring 2014

The way people access the web has moved on again; at is usual lightning pace! Our clients are now using mobile phones, tablets (big and small), laptops and massive screens too and the technology of websites is moving on to accommodate this. The architecture of our database has remained the same but the website needed new technology, a new programmer was brought in to apply his skills with Bootstrap to create a Responsive website. Alex Lewis came up with the base design again. In total we put 7 months work into this, exchanged over 2,000 emails, had dozens of web conferences and numerous face to face meetings, it’s also the first website we beta-tested on users before release.

Alpine Property in the press, winter 13/14

Right in the middle of St Gervais

Taking better pictures of your chalet

How to buy your Alpine Property

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So you have decided to make the move? You want to buy your first property in the French Alps but you are not really sure where to start. Buying a property anywhere, even in your home country can be a daunting prospect but then added to that, you want to buy in France. This creates additional work and research to make sure you get it right first time. Here are our top three tips for making the process as painless as possible.

Get your mortgage agreed in principle

The first thing to do is talk to a good mortgage provider (if like most mortals you need a mortgage) so that they can confirm how much you can afford to borrow. They should give you an in principle decision to lend. We work with the biggest provider of mortgages to non-French residents, just ask Alpine Property to put you in touch. Don’t forget to add in the Notaires fees and Stamp Duty (called Frais de Notaire), budget on 8% for everything except off plan properties in which case it is 2.5%.

Find an Estate Agent to work with

If you don’t speak French then seek out a good local English-speaking agency. They will be on hand to go through everything with you in a language you can understand. The property and the area in which it is located can be fully explained to and you can be guided through the French property buying process, without fear that you have misunderstood something. If you are looking in the Haute Savoie then you obviously should contact Alpine Property!

Get to know the agents. Once you have made contact then arrange to meet to view some properties in person. From our website we have a Google map with all the properties marked. It would be tempting to visit using just this information! With your telephone in hand you could drive right to the door. It would be better not to do this! You’ll miss out on the nuggets of information like “this owner really needs to sell, the asking price is xx thousand euros but I spoke to him yesterday and he’ll accept a lot less”. OR “I’d like to show you this property, it’s not on the website yet but the owner has told me they want to sell”.

One of the main differences when buying in France compared to the UK is the speed at which you’ll be asked to sign the first contract. Once your offer has been accepted the next stage is to draw up a Compromis de Vente (a preliminary contract between buyer and seller) it is then difficult for the seller to sell to someone else, this stops gazumping. At this point you’ll need to lodge a 10% deposit with the Notaire. You will also be tied into the sale so you would be well advised to add “clause suspensives” that would allow you to withdraw from the process if you fail to obtain a mortgage or if your planning permission is refused. If the buyer fails to fulfil the contract they risk losing this deposit.

Only consider buying for the longer term

Buying a property in the French Alps should be considered a long-term commitment. It is recommended that you buy only when you plan to retain the property for at least five years. Transaction costs are high so “churning” properties is rarely cost-effective. You may need to undertake additional research if you intend to live in the area full-time or perhaps rent out your holiday home for part of the year. The cost of living in France is comparable to the UK, though some things will seem expensive (professionals fees) and some things will seem cheaper (diesel which is 20% less expensive according to my calculation in March 2014).

View lots of property in the Alps to make sure you find the chalet that is right for you and your needs and is within the location that you want it. If you want to rent it out, make sure it has all the attributes needed to be rented out easily. I’ve written on the subject of renting here. If you plan to live in it full-time, think about the lifestyle you want to lead once here in the Alps. Do you really want to be above that noisy bar in the centre of town in winter? Or in that “high-altitude” purpose built resort during the summer season?

An Eco-Chalet in the Alps

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Now we have to obtain energy ratings (DPE or Diagnostic de performance énergétique) for all the properties we sell we are shown the stark reality of the amount of energy homes in the Alps use. We know it’s not a cheap place to live but of course we have to heat our homes over the long winter and that is going to cost! Take a look at the following chart for the distribution of energy ratings across our properties.

So most of our properties are D, E or F. I’m not sure that I’d buy a car or a fridge with a rating that bad, and of course our houses cost more to run than either of those! When I see a property with an A or B rating I’m generally sceptical, I always ask our agent how they managed a rating like that and I’ve had replies like “it’s unoccupied and they convinced the assessor that it doesn’t use any energy” or try this one, “it was an E but they got the assessor back and told him to do it again and it came back as a B!” so you can see why I am a sceptic.

We’ve recently taken on a pretty little place in the Vallee Verte which has a “C” rating. As you can see even a “C” is hard to get. To give you an idea what you need to do to get a “C” we have asked the owner some fairly searching questions. He was happy to respond, not a big surprise as reducing his energy bill has been a labour of love. For comparisons sake, it houses a family of 3 in a fairly large house (4 bedrooms/168m2), is detached and at 1000m of altitude and is situated in the bottom of a valley that runs from North to South.

Chalet Michel, near Lullin in the Vallée du Brevon

Water (not part of the DPE rating but it ought to be in this context, it’s still a resource)

Rain water and snow melt is collected from the roof in a 10,000 ltr tank. It is then filtered and used for everything. This is almost sufficient for the needs of a family of 3. The additional costs amount to 50€ but this is mainly the standing charge.

Heating

The house is heated by two methods. An air-source heat pump and an 18kw wood burning stove. Air-source heat pumps are gaining ground on the ground-source systems (often referred to as geothermal heating) as they are less costly to fit and don’t require a large surface area of garden to bury the pipes. These air-source heating systems are a very efficient form of electric heating, you can in fact see the unit on the wall of the photo above.

The house has Solar Panels fitted which supply energy to the grid. At current prices they provide about 1100 € of income. The domestic electricity bill (heating the house, hot water, lighting) comes to 1,500€ a year, so the net cost is 400€/year.

Apparently the main wood burner is only used in really cold weather or for “effect”! Total wood usage is about 3/4 stere (a stere is 1m3 of stacked wood) which at today’s rates will cost 240/320€. I’ll take an average figure for my calculations. So total net resource costs come to about 730€/yr

As a comparison I’ll use my house, it’s not new, it’s a hotch-potch of renovations. I guess it will be an “F” on the DPE scale. The most important insulation (in the roof) was put in over 20 years ago and is not up to current norms. Only half the house has double glazing. We are a family of 5 and the property is semi-detached (4 bedrooms/150m2) at 830m altitude and faces south. Our electricity bill is 2,800€/yr, water 500€ and wood 240€. Total 3540€/yr

So a saving of 2,800€ a year is certainly worth having! Probably 10% of the average family income around here. Even if you take the real consummation figure (so you’ll have to take off the income the Solar Panel provide) the savings are still huge (real consummation figure = 1830, so a saving over my house of 1710€).

Chalet Renovation

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Liz Ockelton is married to Ed our Chatel agent. Liz has brought her professional training as a commercial and domestic interior designer in the UK over to France. She complements Ed’s work as an agent very well, so when he sells a property that needs some work then Liz is on hand to take on the job. From time to time we like to showcase her projects.

Chalet Joyeux was purchased in Chatel in 2013 for 720,000€. The chalet was bought as a second home, the owners wanted a mountain retreat for the family. The aim of the project was to open up the main living space into one large open plan area and make it have more of a cozy chalet style. The open plan living area was really important for the family who want to spend time together on holiday. Upstairs the renovations created an en-suite shower room for the parents and a large family bathroom with bath for the children.

Renovation costs – new kitchen and electrical appliances, 2 new bathrooms, all walls, floors and ceilings in the living space, lighting throughout, old wood interior doors. APPROX 80,000€ and then full furnishing throughout at an additional APPROX 40,000€.

The design research works started in mid Oct when the chalet sale completed. The building works on site took 4 weeks start to finish. All finished in time for the Christmas holidays. All work was completed by local company Alpine Renovation, kitchen and bathroom and tiles all supplied by local suppliers.

Opening up the living area has created a communal space for all the family.

Below are a couple of pictures of the chalet kitchen in its original state.

And below a before and after shot.

A great example of how modernising a bathroom can in bring an old chalet into the current century!

The Alpine Property Blog

Selling properties in the Alps since 1999