Is your Paris pied-à-terre also a great investment?
Is that great apartment in Paris also the right investment property? It’s important to understand what the key components are that create lasting value. Miranda Bothe of Paris Property Group explains.
For many buyers, particularly in the most coveted neighborhoods, short-term rentals provide great income to offset costs and expenses. That elusive “it” quality is important when looking for great investment property, but here are some other key factors that can help determine whether an apartment will make a great investment property and have lasting value.
- It’s important to find the right location, near major attractions, that will appeal to visitors. Central Paris is key; it can’t be too far off the beaten path, though depending on your personal preference you may choose to be in the center of a neighborhood with ‘buzz’, or you might prefer be on a nearby side street so that you avoid overlooking busy roads. A great view is always a good idea, though it will bump your price range up considerably.
- 2 or 3 bedrooms are better than one bedroom. The vast majority of rental properties are one bedroom. Having more than one will increase your rental income while decreasing your competition for rentals.
- The building should be elegant and well maintained. It should feature attractive common areas. An elevator is essential for getting heavy suitcases up to the apartment, as well as accommodating guests who aren’t able to negotiate a lot of stairs.
- Furnishings should be luxurious but sturdy, slip covered if possible, and a pull-out sleeper sofa will allow you more flexibility in accommodating visitors.
- Kitchen and bath must be completely redone to luxury standards. Most apartments in Paris will not have been remodeled properly, but this is not difficult to remedy. Paris Property Group has worked with many English-speaking renovations experts and can recommend one that meets your needs and budget.
- It is important to make sure that you are working with a licensed real estate firm and not a “property finder”. Your investment is important and you should make sure you are working with a firm that is both licensed and insured in case something goes wrong with the transaction. Another important factor is that the fees associated with using a licensed firm are included in the transaction price and can be used to offset your capital gains taxes should you decide to sell.
- The right rental agency is also a key component. It is important that visitors are given a proper orientation on arrival so that they will treat the apartment and building with respect and care.
- Make sure that the building co-owners’ association hasn’t voted against the renting of apartments within their building. You can check this information buy requesting a copy of the minutes from the last few co-owner’s association meetings. This is a key fact to know before investing, because of recent measures taken by the City Hall of Paris to discourage short term rentals. As long as your building hasn’t filed any complaints regarding this matter, you should fine to rent your investment property as you like.
As you can see, it can take awhile to find the “right” property and it’s helpful to have someone on the ground in Paris to make sure you don’t miss out. Great properties that are priced well tend to move really quickly, so it’s important to be knowledgeable about the market and ready to jump when the right opportunity presents itself.