Make it pay! How to get Free Skiing Holidays and a Second Home in France with a French Mortgage
Guest post from International Private Finance, mortgage specialists for the non-resident buyer in France
You can’t fool us, you must admit the joy of discovering a new ski resort each year loses its appeal when kids come into the picture! We’ve all been there, dragging what feels like the entire contents of your attic onto the airport bus, and off again; up to Departures, to find you’ve left the ski poles/Trunki/car seat in the car. Add in the disbelief when you realise you need to book next year’s holiday before you’ve enjoyed this one just to reserve accommodation in the school holidays.
Suddenly, the thought of your own base in the Alps, where you can store your kit year round and use it when you want it, starts to sound appealing. Especially, since you can make your holiday home pay for itself (plus a few additional ski trips)! Low French Mortgage rates and the high loan-to-value and interest-only products on offer, plus the rental yields possible in the more popular resorts and the potential capital growth that prime real estate in the French Alps is predicted to gain, make the economics of owning your own ski chalet start to add up.
The Maths of a French Mortgage for a Ski Property Purchase
We are not the only ones to have done the maths. At IPF, February is one of our busiest times for enquiries as our clients head to the slopes and browse the estate agent windows in their preferred ski resort. Only last week we had a client complete on his dream house in Chamonix:
“After visiting the area multiple times over the past 12 years, we felt that it was a relatively stable, in-demand investment area that will hold its value well and offered year-round rental opportunities. In fact, with the current uncertainties around Brexit and its future impact on the (very expensive) London real estate, we felt it more prudent to invest in France.”
To demonstrate how possible it is to own an alpine property with the currents French mortgage rates and available products we picked a 4 bedroom chalet in Les Houches that is currently for sale at €620,000. Borrowing at a 75% loan-to-value at 2.5% on an Interest-only basis over 14 years would give you a monthly French mortgage payment of €969*.
Owning a Ski Property Versus Renting
When you consider that three bed chalets in the likes of Chamonix, Morzine, Méribel or Tignes will easily rent out for over €3,000 a week in the winter season and over €1,000 in the summer months, your holiday home can quickly become a nice little earner (before any capital increase that you may benefit from if you decide to sell it in the future). Yes, maintaining a second home involves costs – as well as management of the rentals - but even taking this into consideration, you would only have to rent the property out for 10 weeks a year to cover all the costs including the mortgage payments! (The average ski season in France is 19 weeks long, leaving you plenty of time to enjoy the snow yourself). Summers in the Alps are fantastic too.
Better French Mortgage Rates with a Larger Deposit
The ski property purchase example above was based on a high LTV; for those of you able to put down a larger personal contribution, there are even better rates available (from 1.5% for non-residents). With a 50% deposit on a €610,000 chalet, your annual mortgage payments could be as low as €4,500*. When you consider you would pay at least €7 - €8,000 to rent the same chalet on a self-catering basis for the peak weeks of Christmas and New Year and February half-term, it makes sense to savvy investors to buy your own French ski property. Now, all you need to do is decide which ski resort is the one for the chalet or apartment purchase! (And be quick, as there is still chance we could get you in before the last of the snow melts!)
Contact International Private Finance for Rates and a Quote
You can research the latest French mortgage rates here. As the top introducer of non-resident French mortgages, we can secure discounted rates and arrangement fees. To get a personalised quote, based on your current financial circumstances, please fill in our online form. One of our Consultants will be in touch within 24 hours.
*French mortgage rates and LTV is dependent on an individual’s personal and financial circumstances. Please contact us for a thorough assessment of your situation so we can advise you on which products you would be eligible for.
To Become the Owner of a Ski Property
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Find out how to get a mortgage in the French, Swiss, Austrian or Italian Alps.
Read more about the best ski resort for your ski property purchase.
Get some tips on how to get the most out of your currency exchange.
Know what lies ahead with the purchase process our buying guides to property in Switzerland, France, Austria & Italy.