I’m looking into buying a small apartment maybe in Les Deux Alpes for skiing and mountain biking.

I’ve seen some starting at £42k which are fully furnished newbuilds with a leaseback agreement so i buy the apartment, and a management company leases it out for upto 10 years and i get a guranteed 4.25% of purchase price rental return for the 10 years.

The leasing company pay all maintenance charges / taxes / bills for the 10 years.

I can still use it for these ten years but i lose some rental return.

If i used it about 4 weeks (2 winter, 2 summer ) every year for the 10 years i’d still get about £13.5k guranteed income so after ten years id have the property all to myself and it would have cost me £28.5k to buy in total.

I could probably get more rental if i advertised it myself, but then i’d have to also pay all the service charges / taxes from this.

Anyone got any experiences of these leaseback purchases? Would you reccommend or avoid? From what i’ve read they seem a popular way to buy in France as the properties are also VAT free if used as a leaseback.

Not as an owner but I did 3 seasons in the Alps and have friends that have made resorts their homes. I have heard of these before and as you say I think they are a common offer. The developer gets certainty of the initial sale and they also set up or have links with the management / letting company so it’s a win win (in theory). From friends who have bought I would suggest 1. Location is key in a ski resort (is it in a good spot?) 2. Some blocks end up very tatty as the management companies can be very poorly run, especially at the low end and with worker accommodation, remember you are getting in to a big shared ownership project that will all be in French. 3. From my friends that have bought they have all bought flats in smaller established blocks that have required work – the French don’t do DIY so you can normally do well with a fixer upper if you have the time and skill to sort something out (and the language skills to deal with the locals).

I will ask the Mrs, she’s French and with a decent amount of real estate experience

EDIT

From what i’ve read they seem a popular way to buy in France as the properties are also VAT free if used as a leaseback.

This is a big part of it, many (most) people buy boats in France this way for the same reason.

They’re very popular in France for French people as a form of pension/investment. As a foreigner you should do some research on how you stand in terms of tax and how it might change over the 10 year period. Hollande tried to crack down on ex-pat properties a few years ago but I think it got reversed. It depends on how much of your own furniture is installed as well maybe? (second home vs investment).

We looked at this a while back when we bought our place in AdH. Looks good in theory and depends on your personal situation but things to consider: I understand that the income isn’t actually guaranteed, get the contract checked by a French lawyer, generally if rentals drop the income does too. If the developer/management company goes bust (and some have) it becomes very messy. Having bought the place under the leaseback scheme selling it can be tricky within the 10 years and some potential purchasers will be put off by the fact that (I believe) a new 10 year agreement is generated at sale (that may have changed). One of the things which put us off was the fact that you can’t leave any of your own belongings in the place when you’re not there and decor and fittings must be kept within standard spec. Also you’re less likely to be able to drop everything and go over eg. for a long weekend on the spur of the moment if that’s your thing. These places are built to be rented hard and as such tend to sustain damage from happy holidaymakers so coprop fees are generally higher than traditionally owned properties.

Just my 2 Euros worth but for me the flexibility of outright ownership beats the cost saving. Good luck! L2A is a great spot summer & winter, we were over there skiing at Easter.

One of the things which put us off was the fact that you can’t leave any of your own belongings in the place when you’re not there and decor and fittings must be kept within standard spec. Also you’re less likely to be able to drop everything and go over eg. for a long weekend on the spur of the moment if that’s your thing. These places are built to be rented hard and as such tend to sustain damage from happy holidaymakers so coprop fees are generally higher than traditionally owned properties

yeah those are the things i’m a a bit wary of, especially as to what it might be like after 10 years of ski package holiday wear and tear.

How do you rate Les 2 Alpes vs Alpe D’huez for a) skiing and b) biking and also for property ownership?

I’ve heard they are planning on builing a lift link between the two resorts but not sure if this is just talk at present or if it will go ahead.

I’m looking into buying a small apartment maybe in Les Deux Alpes for skiing and mountain biking.

tbh A bit like a time-share, so:

If you want income, then BTL in the UK would probably be a better (less risky) bet.

If you want somewhere for holidays, book a hotel/chalet when/where you fancy each time.

If you want income, then BTL in the UK would probably be a better (less risky) bet.

If you want somewhere for holidays, book a hotel/chalet when/where you fancy each time.
If you want your own place in the mountains where you can spend weeks or months at a time (after the end of the lock-in period) and use in your retirement then a lease arrangement is very attractive if you cannot buy outright at the moment.

I would say after 10 years if its been rented hard it’ll be fairly beaten up but at that point you may decide if you can to go full ownership & re-decorate, put in your own furniture etc although there will obviously be a cost to that too.

We are in Oz en Oisans, just over the hill from AdH, pretty quiet but works great for us and is a real family resort, our kids have grown up going there and at 14 & 15 can rip around the whole domain happily & safely but it’s a ghost town outside of the winter & summer seasons. Skiing wise it depends what you’re into but overall I prefer AdH as its got masses of easily accessed off piste. For piste skiing L2A always seems a little more congested to me with lots of converging pistes, not done much proper OP there but they do have summer skiing on the glacier and the snow seems to generally be in better condition later in the season at the top due to the altitude.

I’ve never ridden in L2A, AdH are finally building some mellower trails below the obvious Mega route and the DH runs around Oz, again depends what you’re into but I’m told that L2A is generally better for VTT trails plus they have a beach there and I prefer the summer vibe in L2A. I have a mate who is buying a studio in L2A this summer, seems property maybe slightly cheaper there, it’s a few miles further to drive to than Oz but you do get the link to La Grave if you like frightening yourself on skis.

The link across the valley has been talked about for years, some friends locally are convinced it will happen, others not so sure, I’m not holding my breath but it would certainly help property values if you were near the link in Auris or at the right end of L2A.

Lots to think about, its 9 years since we bought our place and we’ve no regrets at all but worth considering that you are tied to the place both emotionally & financially and unless you’ve got pots of cash or can rent it for top dollar to fund trips elsewhere you’ll be going there a lot so choosing well is crucial plus the bills do keep rolling in whether you use it or not. Mail me if you want any more info. nick at sanglier-online dot com

Two caveats: these deals are normally funded by upping the purchase price so take care that it is at market, and some resorts control the value of apartments so as soon as they hit a certain price, they allow further development which brings the price down again.

Hi there, I see that your post is a few months old, but wanted to throw in my two cents. My husband and I have had a leaseback for a little over a decade. It has been a wonderful investment, and the rental income we made from it paid the mortgage (it’s long since paid off) and even provided us with w little “fun money” while we were there. We are actually putting it on the market now as we are investing in the US (I’m American, he’s Scottish). You hear various things about leaseback agreements, but we had a very positive experience with ours. Our property is in Samoens, at the foot of the Grand Massif ski area, and there is a PLETHORA of hiking, biking, and climbing in the summertime. I’m including the link in this post if you or anyone else may be interested. We’d be happy to answer any of your questions as to our experience on leaseback in France or on the property itself. just follow the link 🙂