July 11, 2014 4:30 pm

Normandy draws second-home buyers despite rising costs

The French region remains popular with Belgian, Dutch and UK buyers who are realistic about potential rental yields

Normandy’s second-home market is in great part a reflection of its geography: the region’s location dictates that property here is popular with Parisians (much of Normandy is close enough to make it a viable location for a weekend bolt-hole), Belgians, Dutch and UK buyers – particularly those living in southeast England.

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Unlike neighbouring Brittany – which has an indented, and sometimes wild coastline, but is much farther from Paris – it is arguable that beaches are not Normandy’s main draw. The region attracts second-home owners interested in quiet, country living with easy access by car from the Channel ports, says Tim Fraser, a Londoner who owns a half-timbered farmhouse with just under a hectare of land in a village 30km south of the port town of Honfleur.

“The pleasures of life in Normandy are unchanging,” says Fraser. “It’s all about walks in the countryside, maybe riding a horse from time to time, or making jam in late summer. The problem expats often talk about is some businesses in rural areas have been closing their doors because of the slump, which affects morale.”

The pretty harbour in Honfleur has inspired Claude Monet and many other artists©Alamy

The pretty harbour in Honfleur has inspired Claude Monet and many other artists

Administratively, Normandy is split into two: Honfleur is in Lower Normandy, which is more rural, agriculture and tourism-driven than Upper Normandy, which has some heavy industry in and around Le Havre and Rouen. Honfleur is a charming place of 8,200 permanent residents with tall houses crowding round a picturesque harbour that inspired Claude Monet and other Impressionist painters.

Just under 1km from central Honfleur, a mill house dating from 1592 in 1.5 hectares of grounds with a stream and a small pond is available for €2.1m through the Emile Garcin property company. The home, half-timbered in part, has 370 sq metres of living space including six bedrooms, six bathrooms and a living room.

Deauville is an upmarket resort west of Honfleur, boasting a sandy beach and tiny airport with scheduled flights to London City airport. A manor house 1.5km from the centre of Deauville – with seven bedrooms and 800 sq metres of living space spread over four floors – is on the market for €4.98m with Leggett Prestige. The property has sea views, a lift, an indoor pool and a hectare of grounds.

In comparison, a 226 sq metre, four-bedroom detached home in the Breton resort of Bénodet – with a 50 sq metre living room and a fireplace – is on sale for €760,000 with Terre d’immo. The property was built in 2000 and has a double garage.

In the Calvados department, which contains both Honfleur and Deauville, the average value of houses excluding newbuilds dropped 3.3 per cent in 2013, with a similar fall in 2012 (3.4 per cent), according to the Association of French Notaries.

Normandy map

The same type of property in the department of Finistère in Brittany – containing Bénodet – dropped more sharply in price last year (4.5 per cent) on the back of a less dramatic fall in 2012 (1.6 per cent). This has become a buyer’s market par excellence.

According to Karen Robinson, a Leggett Prestige agent covering Normandy, “inquiries for renovation projects are down”. She adds: “Buyers want a finished, well-presented home, ready to move into. Properties with potential income, such as houses with annexes converted into gîtes, are still desirable but buyers have become more realistic about the return they will get from rentals.” Robinson reports an increase in buyers from Belgium in particular. “They see French property as good value.”

One expert takes a nuanced view of the potential of second homes in Normandy to generate rental income. “Leaving aside units in winter sports resorts, 80 per cent of holiday lets are in the July to August period, with the other 20 per cent in June and September. North of the Loire, it is only in Brittany where homes rent easily, and even then they need to be near the coast,” says Sébastien de Lafond, chairman of MeilleursAgents.com.

Seven-bedroom manor house near Deauville, €4.98m

Seven-bedroom manor house near Deauville, €4.98m

“Generally the holiday lets sector is growing in France because holidaymakers are increasingly likely to choose a well-appointed villa or apartment over a good hotel.”

Moreover, a new law on access to housing, introduced in France at the end of March, is likely to affect future buy-to-let opportunities. According to the Notaires de France, the association that supports French notaries, landlords must now justify giving a long-term tenant notice to leave based on an intention to reoccupy or sell the property on what the association describes as “serious and legitimate grounds”.

This could make conventional buy-to-lets less attractive in the (fairly short) list of French cities in which property prices are rising, according to a report from the association in April. In addition, transaction costs in France have been rising.

Since March 1 this year, changes to France’s tax code have allowed French departments to levy an additional stamp duty equivalent to 0.7 per cent of the purchase price. Most departments have already implemented the new tax.

In January the notaries’ association reported that the country’s housing market was operating at two speeds: “The market for low-price properties [a segment valued from €100,000 to €150,000] remains busy. On the other hand, we find that top-of-the-range properties are selling badly, which results in extended selling times.”

Photograph: Alamy

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Buying guide

● Buyers should budget about 8 per cent of the purchase price to cover Land Registry taxes, notaries’ fees and miscellaneous expenses

● Estate agents often charge 5 per cent-6 per cent of the purchase price – a fee usually paid by the buyer

● France’s gross domestic product grew 0.3 per cent last year

What you can buy for . . . 

€250,000 A two-bedroom apartment on the outskirts of Honfleur

€1m A four-bedroom detached house near the racecourse in Deauville

€5m An eight-bedroom château in Normandy with stables, a swimming pool and extensive grounds

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