French Alps Property Insights first part
Thollon-les-Memises
The French Alps are a popular destination for tourists seeking winter sports activities, such as skiing, snowboarding, and ice skating. The region boasts numerous ski resorts, each with its unique character and charm. Some of the most well-known ski resorts in the French Alps include Chamonix, Courchevel, Val d’Isère, and Megève. These resorts offer a wide range of activities beyond skiing, such as spas, shopping, and fine dining. The French Alps are also home to breathtaking natural scenery, including the Mont Blanc massif and numerous alpine lakes. Whether visitors seek an action-packed holiday or a peaceful retreat in the mountains, the French Alps offer something for everyone.
Renovation in French Alps to reduce the number of “cold” beds
Over the past decade, the real estate sector in the French Alps has undertaken ambitious renovation programs to revitalize “cold” beds in the tourism industry. In response to the phenomenon of the “debanalization” of tourist accommodations, the 2017 Montagne 2 Law was introduced to encourage owners of tourist properties to restore their assets, primarily through the ORIL program (Operation for the Rehabilitation of Leisure Real Estate).
In addition to this program, local aids have been implemented in the Belleville Valley (Saint-Martin, Les Menuires, Val Thorens), leading to thousands of high-quality beds being made available on the market. As a result, the occupancy rate has reached 80% during a typical season, thanks to 25,000 high-quality beds, with 90% of them being available for rent.
The emergence of new 4 and 5-star residential properties have also contributed to the improvement of the rental market. Many rustic chalets are being deconstructed and reconstructed with their original beams and modern high-end amenities. The renovation of the real estate market initiated by all actors involved has helped to raise the overall standard of the sector.
Therefore, the offer is currently under tension due to the success of these renovation programs and the emergence of new luxury properties, and the market is constantly evolving to meet the expectations of its customers.
Advantageous tax regimes like property depreciation when buying a French ski property
Investing in a chalet in the mountains has always been an attractive option for buyers looking to enjoy the great outdoors, build a personal legacy, or secure a supplemental income. However, with taxes playing a significant role in any real estate transaction, it is crucial to know the different tax incentives that can help optimize the acquisition of a ski property.
Aspiring property buyers in France can still take advantage of the various investment regimes that were previously in place when buying a French ski property especially for new-builds. Depending on the property’s location and the income generated from it, investors can choose between two French tax statuses: furnished non-professional lessor (LMNP) and furnished professional lessor (LMP). From a tax perspective, the LMNP regime allows for the deduction of all charges once chosen and the practice of depreciation (calculated broadly as 90% of the full property price over 25 years). This means you can offset all charges, mortgage interest and depreciation of the property from any rental income received. In many cases you could generate a deficit that you can postpone year after year if need be.
By choosing to establish a family-owned limited liability company (SARL) upon acquisition, the ski property’s transfer will be facilitated. Meanwhile, the para-hotel regime for new ski properties enables the recovery of VAT on charges and also on the purchase price.