Property: where to buy in France in 2008

The last decade has seen many British overseas buyers switch their allegiance from old favourites such as France and Spain to exotic Eastern European locations like the Baltics, Bulgaria, Croatia, Montenegro and Slovenia. Even more adventurous investors are looking to countries like Chile, Brazil and Nicaragua, while others are throwing their wallets as far as Dubai, Mongolia and Thailand.

As they discover the downsides of buying in these emerging markets – things like costly or cumbersome air travel, chaotic and ineffective legal systems and bureaucracy, unstable governments or economies, or dodgy infrastructures – they would do well to consider that France contains regions, as yet undiscovered or at least only partially discovered, that are prime locations for potential investment.

While many old favourites such as the Côte d’Azur and Dordogne may have inflated property markets or an element of overdevelopment, there are regions and communities that possess perfect investor credentials: namely a low purchase price

and the potential for high capital appreciation and high rental yields.

Harry Lewis, head of Savills International Network cites the department of Tarn-et-Garonne as an area to watch. ‘This part of France is relatively untouched by developers and has not been overtaken by foreign buyers as other parts have been,’ he says. ‘Tarn-et-Garonne is one of the most scenic parts of France. With its medieval hill-top villages, it’s reminiscent of Tuscany. The area is also well covered by budget and scheduled airlines.’

Tarn-et-Garonne is found in the northwest of Midi-Pyrénées and contains thick forests and agricultural plains as well as three rivers: the Tarn, the Garonne and the Aveyron, making it ideal for water sports enthusiasts. The departmental capital is Montauban, which is rich in museums and ancient buildings, while one of its oldest settlements is the attractive St-Antonin-Noble-Val.

Situated in the southeastern corner of Tarn-et-Garonne, on the border with Tarn, Aveyron and Lot, pretty St-Antonin nestles in the gorge of the River Aveyron. The narrow streets are crammed with houses of medieval origin; the River Aveyron passes at their feet while craggy limestone rocks hang overhead.

St-Antonin grew around a Benedictine monastery, established in 763AD, and during the Middle Ages the town prospered thanks to a thriving leather industry before it was captured by the English during the Hundred Years War.

St-Antonin contains one of France’s oldest civic buildings, the hôtel de ville or Maison Romane, a superb example of Romanesque architecture realised around 1150. Today, St-Antonin has many shops, bars and restaurants, and a Sunday produce market when the streets are crammed with stalls selling everything from aubergines to goat’s cheese, Toulouse sausages to wine.

Situated just an hour’s drive to the northeast of Toulouse, there are a number of daily flights to the area from the UK, while the A20 autoroute is just 20 minutes distant, linking Paris and the Channel ports.

Characterful farmhouses to renovate with outbuildings and lots of land are commonly available for under €200,000 (£144,258) – sometimes half that – while a really special spacious home in good condition with a pool would set you back from €400,000 (£288,517) or so.

Beautiful châteaux

Matthew Hodder-Williams at Knight Frank also singles out this area of France as one traditionally neglected by British buyers. ‘One area I happen to think is under thought of and overshadowed by its more well-known neighbours is the former province of Quercy, which today is the department of Lot and the northern half of Tarn-et-Garonne. Everyone knows Dordogne, but next to it is this wonderful area with pretty stone houses, beautiful châteaux, hills, woods, vineyards and wide valleys.

‘Another area I would mention is Charente. We are beginning to see more and more people buying there. Of course, there has always been an international presence in Charente, but we are finding an increase in interest.

‘The prices in southwest France have been very steady in recent years. It is not like buying an investment in Paris that goes up rapidly; you buy there simply because it is a wonderful place to live. Properties in these areas are very good value when compared to the UK, and being less well known than, say, Dordogne, you get a bit more for your money.’

Edward Lazarus at French property agents Domus Abroad is not so keen on the Charente region; in his view after a hefty drive from Calais it is fairly flat and less attractive than surrounding departments. He backs Seine-Maritime, far further north, as an area he would urge buyers to focus upon.

‘Seine-Maritime has been somewhat overlooked as the British thump through seeking the sun further south, or west over to Lower Normandy and then to Brittany,’ he says. ‘In fact Upper Normandy is quite beautiful and much more accessible, making weekend trips realistic.

‘It is attractively priced being less well known than many areas. It is exactly a two-hour drive from Calais, a perfect distance if you are looking to commute to the UK on a weekly basis or want to take weekend breaks. It takes two hours more to travel to Lower Normandy, and four hours extra to reach Brittany. It is also about an hour and half driving distance from Paris, which is another bonus.

‘We are currently selling a five-bedroom house with an old mill, barn and cottage with a hectare of land for €430,000 (£310,155). In Dordogne it would certainly cost double that, and in Normandy certainly 50 per cent more.’

The development of France’s high-speed rail network is opening up whole new areas as potential markets for overseas buyers. In the summer of 2007 the new TGV Est service from Paris to Strasbourg slashed travel times between the two cities by nearly half, which is already causing property prices to increase in areas served by the line, such as Reims and Colmar.

The French train network is due to be upgraded in Brittany, the southwest and the south, which will boost property prices in such areas as Lorient in Brittany, Angoulême in Charente and Narbonne in Aude.

While Narbonne, with its southern coastal location, already has comparatively high property prices, Lorient is currently a good source of bargains. It has five ports as well as fine sandy beaches and inland, some wonderfully unspoilt rolling countryside. When rail improvements to speed up journey times are implemented in about five years’ time, property prices will almost inevitably rise, with the rental market strengthened also. You can still pick up a decent two-bedroom house to renovate here for under €50,000 (£36,064) and a fabulous spacious rural home for under €300,000 (£216,387).