The leaseback schemes in France, called 'Residences de Tourisme', are a great way for people to get an overseas mortgage for several reasons. Many of the agents who deal in leaseback schemes will help you every step of the way through the mortgage process – after all their commission depends on it!
The deal with the French leaseback schemes is that you buy a new-build villa or apartment, often off-plan and receive the VAT of almost 20% back from the French government as long as you rent it out for tourism purposes for 20 years.
It then belongs to you but you are committed under the scheme to rent it out for at least the first nine years, extendable to twenty, with one management company who looks after the property for you and finds tenants. You can often stay in the apartment for a few weeks a year although your returns will be lower.
They pay an annual rent fee to you, which although fairly low, can almost or completely cover the mortgage payments. If all goes to plan you have an apartment at the end of it!
Of course, it is not quite that simple, there are some drawbacks too, as you are reliant on the management company – if they go into liquidation you face huge problems. But it is definitely worth looking into with a reputable company.
