Today’s retirees are looking for more than a quiet life on the coast. For many, a Gallic lifestyle offers that certain je ne sais quoi…
Retirement used to mean buying a bungalow on the British coast, but many of today’s active older homeowners prefer the thought of a gîte or a finca in the sun.
There are no official figures on how many Britons own abroad, but accountant firm Grant Thornton says it could be 1.2m. They are mostly 50 and over – the peak time people to buy abroad, ahead of retirement. The Office for National Statistics says there are 665,000 UK retirees living overseas permanently and receiving their UK state pension.
The favourite location is France followed by Spain, Australia and New Zealand, the US – chiefly Florida – and then Italy, Canada and Portugal.
There are plenty of popular French locations. Wealthy retirees head for the Cote d’Azur while Languedoc-Roussillon is within easy reach for visiting families thanks to budget airline services to Carcassonne, Montpellier and Perpignan. Small houses in Normandy and Brittany in northern France are very good value, although often suffer British-style weather.
“France has overtaken Spain as Britons’ favourite,” says Rebecca Gill of estate agent Savills. “Prices fell 20 per cent from 2007 to 2009 but they’re on the way back. Even so, they’re often a third cheaper than similar properties in the UK.” FNAIM, the French estate agents’ trade body, reports an average five per cent rise across France in 2011.
It’s wise to do your homework if you’re planning to move permanently to France, and over- 50s often take several financial precautions.
First, they see if their private or state UK pension can be enhanced by integrating it with an international pension scheme called QROPS, the Qualifying Recognised Overseas Pensions Scheme. Second, many take out private health insurance: the cost will vary according to age and health, but for many 50-yearolds it can be around £1,100 a year.
UK retirees often make French wills to avoid dispute or uncertainty over the details of their wills back home and finally, they typically consult financial advisers in the UK about the best way to structure their tax and other liabilities.
“It sounds complicated but I did it all in three months,” says retired carpet businessman Simon Wheale. In 2007 he left Solihull to live in Villefranche-de-Conflent near Perpignan – and his preparation extended to choosing his location with great care. “I knew the broad area where I wanted to live, but I put my belongings in storage and spent another three months renting, to find the villages with the best facilities.”
Aside from the French lifestyle, Wheale enjoys more than 250 days of sunshine a year. He puts it this way: “That’s quite a lot more than I might have in Margate or Worthing.”
Buying in France
When you find your ideal home, you sign a contract in front of a legal notaire and then commission a survey – even though the French often don’t bother.
Once you are happy, you pay 10 per cent deposit, kept by the seller if you stop the purchase without good reason.
Expect to pay between nine and 12 per cent of the purchase price in stamp duty, legal fees and taxes. If you buy a brand new home, you pay VAT on it, too.