Property Market and Sarkozy

So far, across the board it's been predicted that Sarkozy will have a positive effect on the property market in France. Obviously, whenever there is a change of power there is the hope that all that is wrong will become right, but in terms of real estate, Sarkozy seems to be taking steps to make a vast impact, even if nothing else goes right. Since his election, real estate agents have apparently seen an increase in demand.

The Pouvoir d'Achat (Buying Power)
Sarkozy wants France to become a country of home owners, which is an important move considering that France is below average in home-ownership compared to the rest of Europe. His initiatives to combat unemployment and lack of spending power in France aim to get the economy rolling again, which will of course influence the property market. House prices continued to rise in 2007 but with certain areas flagging behind, there was, until the elections, the general sentiment that property was being over-priced and everyone feared a lull in the market.

Besides tackling unemployment, he's promoting buying power by offering a number of tax breaks that are directly related to property: mortgage interest payments on family residences can now be offset again income tax, as well as tackling inheritance tax.

Investing Early
Several of Sarkozy's reforms are not to take place until 2008 and estate agents are suggesting that investors should get in early before the predicted boom starts next year. Also, there are rumours that he will also be doing something about the insane amount of French bureaucracy that surrounds the property market. Another plus for small-time investors who might have been put off by the infamous 'notaires'.

Sarkozy's attitude towards foreign property investment has been positive. He's pushing the French population to buy but at the same time is trying to keep foreign investors interested and feeling welcome. He's not making an issue of nationalism, which is a pretty smart move.