Posted on 14 December 2012
Buying French ski property with a mortgage has become an especially attractive option in the last few months, thanks to banks adjusting their rates downwards and changing their product lines.
Mortgage rates have hit – and remained at – historic lows in France during 2012, which when combined with the weaker Euro makes financing a property in the French Alps an affordable option for many British buyers. Lenders in France are currently offering fixed rate interest only mortgages, typically at rates of 4.3 per cent with 15-year terms and requiring a 30 per cent deposit. Or a typical repayment (capital and interest) fixed rate mortgage for 20 or 25 years would come with a rate of 3.6-3.75 per cent.
The threat of rising inflation in France has made fixed rate mortgages particularly appealing in France today. The current combination of very low long term rates and soft property prices with the promise of inflation and higher rates at some point in the future, as well as an inevitable increase in property prices, make conditions ideal for investing in ski property in France.
Certain criteria must always be met in order for a buyer to qualify for a mortgage with a French lender. For example, when taking into account the future French mortgage payment, all contractual outgoings must not exceed one third of a borrower’s monthly income.