With most owners only using their properties for just a few weeks each year and the demand for accommodation ever increasing, the French government introduced a scheme to entice owners of new properties into renting them out when not in use.
The scheme known as Residence de Tourisme in France, which we term as Leaseback has been running for over 25 years and has proved to be very popular amongst purchasers of holiday homes. The MGM group has already completed many Leaseback Residences in the Alps. Most of MGM's latest developments have 4 star status (the highest possible classification) and offer some of the finest accommodation in their respective resorts.
The MGM residences are built to the highest standards and most of them are managed by the MGM Group's dedicated specialist company, La Compagnie de Gestion Hoteliere (CGH), which handles maintenance, letting and management for owners, providing a seamless after-sales service at a consistent high standard. If you think that you would only be using your property for 4-8 weeks each year, Leaseback may be an option worth considering.
The purchaser buys the freehold of a new property (within designated projects only, the "Residence de tourisme") and then leases it back to the management company for an 11-year term. In order for someone to enter into such an agreement there has to be an incentive. This is offered in three distinct forms depending on the chosen lease option. MGM - LEASEBACK PURCHASE OPTIONS
1/ Lease with rental income and 8 weeks use" (4 in season, 4 out of season*) - The price of the apartment is payable excluding VAT (currently 19.6%).
- The owner is guaranteed an annual rental income according to the size of the property and the resort.
- The owner retains 8 weeks use per year during the course of the 11 year lease. 2/ "Lease with price reduction and 10 weeks use" (6 in season, 4 out of season*) -The purchase price is reduced by 30 per cent. The discount consists of the non-payment of VAT (19.6 per cent) and a one-off lump sum equivalent to rental income paid in advance. - There is no rental income for this option, as there has been a discount on the purchase price. - The owner retains 10 weeks use per year during the course of the 11 year lease. 3/ NEW! "Lease with FLEXI OPTION" offering total flexibility! - The price of the apartment is payable excluding VAT (currently 19.6%).
- The owner receives a guaranteed rental income of 3% of the price excluding VAT (with no occupation)
- The owner can use his apartment as much as he likes during the winter and the summer seasons
- The value of the weeks used by the owner is deducted from his 3% yearly rental income.
- The owner receives a discount of up to 20% on the price of each week (10% on high weeks, 15% on medium weeks and 20% on low season). We will send you estimations on request. High, Medium and Low Season weeks are determined every year by the CGH, the Management Company, depending on French and European holidays. *Off season weeks are in May-June-Sept-October. During this time, the facilities and the reception are closed; you only have access to your apartment.
Under the 3 options, owners can sell at any time and, at the end of the 11-year term, can choose to enter into a new lease agreement on mutually agreed terms or opt out of the scheme and retain full use of the property.
In some resorts in the French Alps, where local authorities are worried about the shortage of rental properties, they have introduced laws making renewal of leaseback arrangements for a further seven years compulsory at the end of the initial 11-year term.Please call us on 020 7494 0706 for more information.
For our project in Courchevel 1850, the leaseback option is different. We call it the Leaseback Partnership Option, similar to the FLEXI option, please call us for more information on 0207 494 0706. | 
