Organise Owners in Residence du Tourisme


There is an umbrella group in France to represent owners groups from French Leaseback owners called Fédération Nationale des Propriétaires de Résidences de Tourisme.

The group have been active in supporting owners organisations.

The Association of Tourist homeowners was created by FNAPRT to house owners that have no association in the tourist residence where they own property. We hope of course that this situation is only temporary and we will support them, if they can, to create an association.

Meanwhile, via APRT, they receive the same information and the same services as the owners being members of an association affiliated to the FNAPRT. The annual membership fee is set at € 50. Further information and membership with Christine Lorenzini ( )

You can find them at

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Leaseback Rules on 70% Changed


One of the restrictions with French Leaseback status on a site has been that the development must have at least 70% of the properties in a lease to retain the French government ‘leaseback status”. If my French serves me, it seems  that this has changed in Mar 2015 and has been reduced to 55%. However, there is a stipulation that  the residence must have operated for at least 9 years.

This is some good news as the French Ministry of Tourism seem to have recognised issues with the law relating to these ‘Résidences du tourisme’. The law is less restrictive now.

A derogation, sustainable lease obligation of at least 70% of local furnished home is set at 55% for:
-The tourist residences operated for over nine years, whose ranking has expired on the effective date of Decree No 2015-298 of 16 March 2015 amending the conditions for classification of tourist homes; -the unclassified establishments meeting the specifications laid down in section D. 321-1 , operated for over nine years.

And from the decree itself:

A titre dérogatoire, l’obligation durable de location d’au moins 70 % des locaux d’habitation meublés est fixée à 55 % pour :
-les résidences de tourisme exploitées depuis plus de neuf ans, dont le classement est arrivé à échéance à la date d’entrée en vigueur du décret n° 2015-298 du 16 mars 2015 modifiant les conditions de classement des résidences de tourisme ;
-les établissements non classés répondant aux caractéristiques fixées à l’article D. 321-1, exploités depuis plus de neuf ans.

Find the related French government details on Article D321-2 of the French Tourist Code on


JORF n°0065 du 18 mars 2015 page 5032 texte n° 37

DECRET Décret n° 2015-298 du 16 mars 2015 modifiant les conditions de classement des résidences de tourisme

NOR: EINI1413630D



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Talking up French Leaseback !



A recent article in the Indo on 5 Alternative Ways to Invest your Savings suggests that we could look at buying a French Leaseback. One contributor from a prestige investments company admits that French banks have been ruthless with indebted Irish investors,  but believes that

leaseback is an investment that can represent good value in the long term

Perhaps it can, but you don’t hear much about that. You do hear a great deal about how you can’t sell them at all for anything close to what you paid for them.

I would strongly encourage anyone thinking of investing in a French leaseback property to have a look at the 1,500 or so posts on forum to see the feedback of others and take a critical look at how that ‘good value’ might be realised – even in the long run.

The same contributor is pushing the same old marketing tics of 1) VAT savings and 2) ‘guaranteed’ rental returns.

It gives you the right to use the property for short-term tourist rentals over a period of nine, 11 or 18 years. You receive in return, major tax breaks from the French administration (19.6pc VAT) as well as a guaranteed rental income for the duration of the contract from the management company which varies between 3-4.5pc depending on the development.

VAT Tax Breaks

You could equally argue that there is no VAT saving whatsoever for the owner as the ‘saving’ is factored into the selling price the developer pitches the properties at. Many leaseback developments are designed to be sold as leasebacks. The the ‘leaseback’ status is awarded only if at least 70% of the properties in the Résidence du Tourisme are leased to an operator for short tourist stays. This promotion of the provision of tourist accommodation is the purpose of the government leaseback initiative.

Guaranteed Rental Returns

As we have seen, many operators have gone into receivership, or have pressured owners to sign lease amendments agreeing to half the rental returns originally ‘guaranteed’. Instances are numerous. The pain for Irish owners is on-going.

Even if you do receive the 4.5%, there will be costs to pay out of that. For example, for a €200k property at 3% you would get €6k. Out of this you might have to pay €1k for Taxe Fonciere, €2k for maintenance/syndic charges, €350 for a French accountant. That’s before you start to pay back a mortgage.

The media needs to be taken with a grain of salt, wherever someone is put forward as some kind of expert on a property investment you will often find someone with a financial stake in the flogging of said investment.

I’d like to suggest a 6th alternative  – take your hard-earned savings and buy some bricks and mortar and then throw them down the nearest bog hole..

(though of course I don’t mean that, as I’m environmentally responsible, and I like bogs!)

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Diarmaid Condon on French Leasebacks


Have you seen Diarmaid Condon’s blog ?

Sadly, I came to it too late, after I had already signed a second lease. That was the second mistake I made (the first was signing the first lease !).

Diarmaid has been writing on property for a number of years and  is up to speed on the problems with the sale of French Leaseback properties.

Have a read of his cogent article on the problems with French leaseback properties here .

He describes how many owners signed a second amendment to the original lease which meant a reduction in rent, all because they were afraid they would a) have no rent at all to pay the French mortgage and b) have the French government demand payment of 19% VAT on the purchase:

The management companies would then claim that they could not continue to provide the agreed returns (often as high as 5%) and owners would have to take a 30% to 50% reduction in rental income for the company to remain viable.

All too familiar. I was promised 5% in the original lease. I was pressurised into a 50% reduction after the operator, who was also the developer (quelle surprise), claimed the resort was facing bankruptcy. It went into  receivership anyway.

Does this resonate with you ?


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