TO RENT OR NOT TO RENT, THAT IS THE QUESTION...

You've found your ideal place in the sun, been to the notaire and handed him a fat cheque and the keys are in your hand. You can't wait to move in but before you go any further you must ask yourself an important question. Do I want to make my asset work for me or am I happy just to enjoy it and write off the costs as the price of my pleasure?
In other words do I want to generate a rental income from my property to help defray the costs of ownership?

We all know that houses have running costs but what about the costs of the capital employed. If you have a mortgage that cost is clear but if you have paid with your own funds there is still a monthly cost as you are no longer receiving the interest on the capital you have invested in the property.
Although over time you hope to make a capital gain remember in France capital growth on property is much slower than in the U.K and it will take several years to just re-coup the not inconsiderable costs involved in the purchase.

If you want the convenience of having your French property available to you at a moment's notice or if you have bought it as a primary residence then clearly rental is not a realistic option, (although some owners in areas where summer rental incomes are extremely high such as the Cote D'Azur will still move out and rent during July and August), but if you have bought as a secondary residence then careful planning of the weeks you and your family want to use will leave attractive available weeks to generate some income.

Which weeks these are of course depends on your location, there is no point expecting high demand in the winter if you have a "place in the sun" or conversely in the summer if you are in a ski resort., though having said that some ski resorts are now proving to be increasingly popular in the summer for the diverse outdoor activities they offer.

Assuming you have now taken the decision to rent there are many factors to be taken in to consideration.

Furnishing and Decor.

This is a logical starting point as if you get it wrong it will be expensive to correct later. The bar has been significantly raised in the last few years and it is no longer acceptable to fill the house with your old furniture or have the "it will do" mind set. The better thought out better decorated properties are the ones which will be booked up first and which will be more likely to create repeat business. They are in other words the "in demand" properties.

They don't need to be the biggest or the best properties and the furniture and décor does not need to cost the earth. The key is to keep it simple and uncluttered.
First impressions both photographic when you are marketing your property, and physical when your clients arrive are most important. People want to see light, airy, comfortable, clean and tidy surroundings.

Paintwork should be in good un-chipped condition. Colour is very subjective. Neutral is best. You need to appeal to the majority so even if you like a strong colour which makes a statement to you, chances are many others may not.. That's not to say everywhere should be a bland magnolia but subtle shades of most colours are readily available and keeping the walls white or in a pale shade of colour will leave you free to use stronger colour in the soft furnishings. Try to avoid using brilliant white even for woodwork as this creates a cold effect. There are now many shades of white which help to create the summery feel which is ideal. Do not use too many colours in one room, a planned consistent theme is the objective.

Soft furnishings need to be easily cleaned so sofas and armchairs with machine washable covers that can easily be put back are best. They should be comfortable and adequate for the number of people your property sleeps.

Light coloured fabrics look great but will look dirty very quickly so if you have kept your walls light, darker shades for the sofas are fine. I would suggest trying to avoid patterns and keeping to a relatively plain covering. You will need a chunky coffee table and small side tables

On the electrical side essentials are TV, DVD, Sky or other digital system and a small sound system
Although you hope the weather is good enough for your clients to eat outside a sturdy dinning table with sufficient seating for your property's sleeping capacity is essential.

Beds should be in tip top condition with new good quality mattresses. Plain white bed linen works well, don't skimp on quality as it will have to withstand repeated machine washing

Trying to advise on kitchens is difficult as they come in all shapes and sizes. The same basic principles apply. Whether it's a country look or ultra modern it must be scrupulously clean and in good condition. Old dark battered wood units will ruin the feel of the whole house. If you have chipped and scratched melamine work surfaces they will always look dirty even when they are not. Replacements are in order and updating to a quality work surface will improve the effect enormously.

It goes without saying that these days a washing machine (which does not have to be in the kitchen) and dishwasher are de rigueur and as many kitchen electrical appliances as you would expect in your own home are needed.

Unless you have someone who comes in to your house on a very regular basis house plants must be avoided. Pretty when watered – sad when dead!

Outside easily cleaned garden furniture is a must. The list is endless but as a minimum – dinning table and chairs, enough sun beds for at least 50% of the occupancy (100% is ideal) parasols and the quintessentially British requirement a decent BBQ. All should be good quality as use will be hard.

At the end of the season you must be prepared for the fact that your property will have suffered from wear and tear. It's inevitable so before you start again next year take stock of what needs doing. Refresh paintwork where necessary replace broken or chipped items. Generally return your property to its previously pristine state. If you don't it will become more difficult to keep on top of in the future and your attractiveness to renters will suffer.

How to rent

Having set you home up to receive your clients you now have to market your property to fill those available weeks. There are basically two choices; - Do it yourself or use an agent.

If you do it yourself you need to prepare a clear description of the property and is facilities. Try to be as precise as possible as to the location and the facilities and attractions nearby, but do not give the address as that may be picked up by the unscrupulous that unfortunately exist amongst us who wish to benefit from the knowledge that your house is probably un-occupied for many parts of the year. You will also require good quality photographs preferably taken in sun light.

The most effective medium for advertising is now the internet and there are many reputable companies who provide dedicated sites for you to place your advert on. Take some time to trawl around for one (or more) that best suits you. It may be a high profile site covering all areas, or a site dedicated to a particular area or activity but remember if the site does not appear on the first or second page of Google it is going to be little read. Likewise if you create your own site it will be difficult to get it up the google rankings, but may of course be useful if the site you advertise on allows you to place a link to your site, enabling you to show more photos and elaborate on your description.

Pricing is a difficult area. You must be competitive with other similar properties in your area (more research) but do not have to be the cheapest. Indeed if you are too cheap many people will ask why. Generally it is good value for money that is looked for and when people are going on a potentially expensive holiday they prioritise position comfort and good facilities over saving the last few pounds.

Having successfully rented your property and received cleared payment you must provide precise details as to how to find the house. It is also essential to have a local key holder who can greet your clients, escort them to the house and show them how everything works. Gone are the days when you send them a key in the post and keep your fingers crossed. Your key holder must also be prepared to be on hand should any problems arise.

I would also strongly recommend taking a deposit against damages, refundable once your key holder has reported that all is in order. Don't be tempted to make this deposit too small. Most people are extremely careful in rented property but accidents can and do happen and if the damage is of a material nature a couple of hundred pounds does not go far these days.

I would also suggest that your key holders should preferably be a local property management company.
They will of course charge for their services but a friendly neighbour helping out is not going to be able to provide the level of service or attention that is now required.

If you have a pool then a cleaning contract is imperative as is a gardening service.
At the end of your client's stay your property must now been cleaned and prepared to its previously immaculate condition. A quick superficial clean is not adequate and even in a small property in depth cleaning is time consuming and can be expensive.

Sounds like a lot to do, and it is. Not easy when you are a thousand miles away.

The alternative is to use a local specialist rental agency. They will do all the above for you from photographing and marketing right down to the final clean. Of course this service does not come cheaply but you will be relieved of a lot of time consuming effort and worry.

Expect to pay at least 30-40% of your rental income for this service but on the whole it will probably be worth it, and when you have added up your time and costs, and the costs of key holding cleaning and management, not much dearer and far less worrisome. Most people find it much more convenient to have one company responsible for all aspects of rental.

Tax implications.

French law says that even if you are a U.K. resident and pay tax there you will still have a tax liability in France on the income derived from your French property as the property is located there.

I strongly urge you to take professional advice from a French accountant in this matter. Depending on how you have structured your rentals some of the expenses and possibly mortgage interest will be deductible from the income leaving you with little or perhaps no liability.

If you make no French declaration then you may be exposed to an in depth investigation of your affairs by the fiscal authorities in France going back over the past three years. These investigations can be very profound and uncomfortable and not only will you be assessed for French tax but also lateness penalties and further penalties for non-declaration. You will probably need the services of an accountant to help you hence we would recommend taking the advice needed from day one saving money and hassle.

You should also declare your income in the U.K. but as a double taxation treaty exists between France and U.K. any tax paid in France will be deducted from any U.K. liability arising.

So there you have it. If you make a list of pros and cons it looks like lots on the negative side with the income which can make a substantial contribution to the costs of maintaining your French home the big positive.

After expenses taxes etc. it is unlikely you will retain more than about 40% of your gross rental income.
If your property is small and generates only a small income you may feel its not worthwhile but on the other hand many properties can generate a substantial gross income so 40% is well worth having.

I am happy to go in to further depth on any aspects of rental and give more specific advice to any reader who wishes to contact me.