french leaseback proprerty365

[johnybravo]

Has anybody bought a leaseback with property365? They have them on offer for depsosits of few thousand euro and mortgage repayments deferred for the first 5 years. This allows you build up a pool of money to help cover the mortgage when the 5 years are up. I don't like the idea of the rent not covering the mortgage and I am amazed at how they can offer a property worth €230,000 for only a down payment of €5,000 and nothing more. Am I missing an opportunity here or is my gut right and I stay well clear?

 

[RedArmy]

johnybravo,

I have bought using this scheme through another company, the deal is exactly as you have explained, however the mortgage deferment is for a 2 year period, during this two year period my rent will gather in my french bank account this will be enough to cover any shortfall in the future, as long as you use a strong management company you are in a good position, you should speak with the company you are dealing with and see if there is a chance to get an interest only mortgage, where this is possible there is usually no shortfall with the mortgage repayments as the rental income is sufficient to cover payments. Also its worth bearing in mind that you have the rental guarantee for 9 years from the management company. I like you was a nervous investor and when I initially made the jump into the property market i was scared of every opportunity that was put in front of me.

 

[DonKing]

Has anybody bought a leaseback with property365? They have them on offer for depsosits of few thousand euro and mortgage repayments deferred for the first 5 years. This allows you build up a pool of money to help cover the mortgage when the 5 years are up. I don't like the idea of the rent not covering the mortgage and I am amazed at how they can offer a property worth €230,000 for only a down payment of €5,000 and nothing more. Am I missing an opportunity here or is my gut right and I stay well clear?

Johnybravo,

You are in a very good position.....because you are starting to do some research before you make an investment in foreign property.

My advice to you, would be to stear well clear of French Leasebacks. If you do some further research you will see the countless problems investors have had with French leasebacks.

Forget about the guarantees of 9 years rent, not worth the paper its written on when the management company goes into liquidation or when the management company is struggling to rent out your apartment.

Alot of the these French leasebacks are in undesirable rundown locations. The resale value will be low.

Treat Redarmy's advice with caution, he is a first time poster and probably has a vested interest.

He claims you're a nervous investor because you are asking very sensible questions about a 230k investment!.....His comments speak for themselves

In relation to the mortgage deferment, I don't know the details,but they have probably added the cost of the finance onto the cost of the property. I presume you may have pay stamo duty/taxes etc based on the cost price of the property? so this all adds costs

 

[Hans]

Stay well clear as Donking says do research on French Leasebacks and you will see it's not the bed of roses it's advertised to be, I know people that are sorry they ever laid eyes on this investment they have problems in letting them and management companies collapsing. One friend has just come back after having to go out there himself to organize things with other owners as the Management company pulled out. They have had to come up with the mortgage that was suppose to be paid by tennants - ask him - he will say 'nightmare'.

 

[Arch2]

[broken link removed]

You should find this site quite usefull.

It not all bad but it is not all perfect either.

 

[Timbo]

I have made the following comment before, but it is worth repeating.

Leaseback schemes are not property investment. You are not buying property, but a share of a variable and uncertain future cash flow.

 

[urania]

New in leaseback

i am new in the site. I am looking for an apartment in France. I am trying to understand the meaning and advantages of leaseback, as this is unknown here in Greece. Could someone explain (giving an example)? The cost of the house is about 120,000euros.
Thank you in advance.