Guide to French Leaseback Properties

  1. Introduction to French Leasebacks
  2. The French Leaseback Market
  3. How Leasebacks Work
  4. Contractual Agreements for Leasebacks
  5. Tax Advantages of Leasebacks
  6. Selling your Leaseback Property

4. Contractual Agreements for Leasebacks

In the first instance you will enter into a contract with the developer for the purchase of an off-plan property. These contracts are called Vente en l'Etat Futur d'Achèvement (VEFA).

If it an existing development at least 15 years old which is to undergo renovation then the contract will be Vente en Etat Futur de Rénovation (VEFR).

It is also possible to invest in a development that has recently undergone renovation.

As part of the contractual process the developer is obliged to undertake to offer contractual guaranties concerning completion of the dwelling, as well as a ten year building guarantee.

We recommend you use your own notaire for these contractual formalities.

You can read more about VEFA contracts at Buying Off-Plan Property in France.

Following completion of the development (or at the same time you enter the build contract), you will need to enter into a commercial lease with the operator to run the complex for a minimum of nine years.

The tax breaks are conditional on a commercial operator being in place with a short period of completion and that these arrangements are maintained, although there are particular rules should the operator become bankrupt or terminate their lease.

Next Page: Tax Advantages of Leasebacks