Since their introduction of French leaseback property to the Irish market some four years ago, Colliers Jackson-Stops has witnessed a surge in Irish investors investing in leaseback properties in France. According to Gillian Ryan, manager of Colliers Jackson-Stops overseas department, this response is partly due to the less favourable investment options available in the Irish property market. "The property market in France is booming but in contrast to Ireland, comparatively low purchase prices make it attractive to Irish investors. These investors, (including SSIA benefactors) are now looking to more affordable overseas property markets".

"Leaseback properties tend to be a sound proposal. The purchaser owns the freehold outright, receives a fair return and can expect a capital gain. Yields average 4.5-5.0% net (6.0-6.5% gross) and nine year index linked contracts are commonplace," added Ryan.

"Certain leaseback purchases are ideal for buyers who want access to a holiday home for a few weeks of the year with the added benefit of a guaranteed income for the remaining weeks. Many Irish investors are diversifying their property portfolios by investing in French leaseback schemes as they are fully managed, there are no maintenance costs and they represent an affordable investment. France has a history of steady growth and with a new President and economic reform programme underway, the economy looks set to remain buoyant."

Introduced in 1985 by the French government, the leaseback or 'residence de tourisme' scheme was put into place to encourage people to buy holiday accommodation to let to tourists, thereby increasing tourism revenue and boosting the construction and hospitality industries.

The investment aspect of purchasing an overseas property is playing a larger and more important part in the motives of of Irish buyers. After considering purchasing property in Ireland, many investors realise that their money goes a lot further in France. In the past, French property has not been a particularly good investment as prices have only tended to rise in line with inflation. However, the market has heated up recently as this is from a fairly low price base, the view is that there is still considerable potential for capital growth.

Leaseback purchase provides a guaranteed rental income, the property is purchased fully furnished and the operating company looks after the letting process, manages and funds maintenance.