With all the doom and gloom surrounding the property markets, we felt it was about time to take a look at those markets that have remained robust and healthy throughout the current credit crunch. So here are five markets that have consistently performed well, regardless of the ups and downs seen recently.

Manhattan, New York

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Price per square foot can be an interesting approach to pricing real estate and we though it would be interesting to compare luxury condominium prices around the world to other types of space for sale. How much space in a luxury condominium would you get for £100,000? These prices are based on Knight Frank’s annual wealth report 2007 and may have changed slightly since then. These are the top ten contenders.

1. London

London currently tops the list. £100,000 buys you 43.5 square feet. Coincidentally, this is exactly the same footprint as the Ford Escape, an American SUV. So you can rest assured you will be able to park the car at this price.

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French property prices are set to increase dramatically since the introduction of a new high-speed Eurostar link from St Pancras station in London. The high-speed rail line, launched on Wednesday, promises to cut most Eurostar journeys by 20 minutes, making Paris a less than two-and-a-half hour train ride away from London.

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A Million Dollars. It certainly sounds like a lot of money. Just say it out loud: “A Million Dollars,” now say it slowly, “A Million Dollars.” It still sounds like a lot of money, but what will a million dollars buy in London, Europe or Africa or South America? As I began researching this article, the phrase, “One man’s meat is another man’s poison,” came to mind. Obviously, some countries vary widely from area to area, but here are some interesting properties for sale from around the world that all have the same price tag – A Million Bucks.

London. In London, one million bucks will secure a 3 bedroom flat in W6, a short walk from Hammersmith Broadway. This particular flat is offered by Foxtons and comprises one reception room, kitchen, three beds and one bath over 87 m sq. Leasehold with a share of the freehold.

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Buying a property in France, for the most part is no different to buying in the UK or the US, but there are a few things that need to be taken into consideration before making a commitment, especially in light of the recent and continued changes in French Property laws and social security rules.

State Medical Cover. Top of the list has to be the planned introduction of new rules governing National Health care for ex-pats below retirement age living in France. The French social security recently released a statement announcing that inactive people (read retired or unemployed) below state retirement age will no longer be eligible to receive state health coverage. This will affect many thousands of Britons already living in France and is certainly something to take into consideration if you are thinking of buying in France, are below retirement age and have any kind of long term health issues.

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Changes to the tax treatment of mortgages, inheritance tax, wealth tax and health charges will all impact non-nationals with residential property in France that they use as their primary residence. This has implications for as many as 100,000 UK citizens that have settled across the Channel permanently, The Times reports.

The introduction of mortgage interest tax relief is probably the most significant change to the financial framework of investing in property in France. However, it’s essential to realise that the change is subject to strict limitations, the chief of which are that it only applies to purchases made since mid-May and only for the first five years of the loan. There are also ceilings on the amount of interest that benefits from tax relief - €1,500 for couples and €750 for single people - according to French Property News, which points out that there is a cap on the total proportion of tax relief that benefits from tax relief of 20%. The magazine does not make clear if this is each year or for the lifetime of the mortgage; it seems a difficult calculation for anyone (purchasers or tax authorities) to make if the latter is intended.

Barclays Bank are offering a variable rate mortgage for property purchases in France with an introductory rate of 4.35% and 1.15% above the interbank rate (Euribor), currently 4.781% or a 25 year fixed rate mortgage at 5.10% (not much more than the seven year term fixed rate at 4.95%). Taking the variable rate mortgage (after the first 12 months) as an example it seems that you would only be looking at the purchase of just over €25,000 worth of property. The new regime seems clearly designed to benefit purchasers at the lower end of the property ladder, giving proportionately the most assistance to purchasers buying properties at around €126,000. In terms of French property this is a much more significant sum than would be the case in the South of England (or Ireland). Possibly, the most interesting question at this juncture is whether or not the French government has plans to be more generous with mortgage interest tax relief in the future, growth and stability pact permitting.

The changes to inheritance tax (IHT) will be important for UK citizens who have retired to France. Property passing to spouses will now receive the same (exempt) treatment as it would in the UK. The IHT allowances for each son or daughter rise from €50,000 to €150,0000. The actual IHT rate remains on a sliding scale from 5% on amounts up to €7,600 to 40% where the taxable element of the inheritance is over €1.7m.

With regard to the French wealth tax (Impot sur la fortune - ISF) the key change is a reduction from 80% to 70% in the proportion of your assets that are subject to the tax. In terms of French residential property, this makes the tax significantly more avoidable. However, it is important to remember that residency in France means that non-French assets come within the ambit of ISF with serious implications for those who still own property in the UK. The recent tax treaty between France and the UK does allow for a five year exemption period from this onerous levy. It’s important to remember that the ISF is levied on the household rather than individuals but there are exemptions relating to the ownership works of art, antiques, farmland and woodland, and assets relating to employment.

The changes to healthcare charges relate to the refunds available to people who have not yet reached retirement age but are not working.

The answer is probably that it is too soon to tell. In particular, the fulfilment of Nicolas Sarkozy’s plans for the French economy are contingent upon the election of cooperative National Assembly in the June elections.

There has been considerable attention to the introduction of tax breaks on interest payments for mortgages for first homes (main residences). Of course, this will only directly benefit a the minority of foreign owners of French property for whom France is their main place of residence. Also, the impact on property prices will be felt most strongly in well populated areas rather than the sequestered locations that overseas investors favour for second homes. However, resort areas should join in the overall benefit of the change.

President Sarkozy is also planning a reform of French inheritance tax with the intended effect of removing all but the wealthy from its grasp. This is likely to cause some French people to consider trading up the property ladder more favourably.

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House prices in France have skyrocketed by about 210% since 1995, making homeowners including 180,000 second home owning Brits well pleased to see their investments soar. But in recent times, the French market appears to have slowed down, from double-digit gains to about 7.2% in 2006 and a sudden fall to the negative at 0.6% in January this year.

Experts and economists attribute this pandemic to the already cooling US property market & economy. Jean-Paul Six, chief Europe economist for Standard & Poor’, was quoted as saying: “I think we will see falling house prices in France during the coming months and that is going to cause headlines. It is the delayed effect of rising interest rates, which have already gone up seven times to 3.75pc, and continue further up.”
In Europe, the boom has not only been restricted to France alone, but Britain, Spain, Ireland, Scandinavia, Holland and Italy have all enjoyed a housing boom of sorts in the past decade. The exceptions to this have been Germany and Switzerland, where the property market has been flat since 1996.
Spain is where the bubble is really evident, with soaring house prices; homeowners have witnessed a rise of about 270% in the last ten years. And with Spanish banks preference for floating rate mortgages or fixed ones, 93% of Spanish mortgages have been issued on this basis. France compared to this, looks as solid as a fortress because French banks normally restrict lending to a maximum of 75% LTV. Another factor to look out for is household debt to disposable income ratio which in France is a mere 65%, whereas in Britain a stout 146%, and Spain a slimmer 115%.
What has emerged from this French property scare is the glut of housing in France, in part due to an overheated construction industry that could well impact negatively on The French property market. Anyone for Croatia? Read more on Telegraph.

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British investors are finally cottoning on to the holiday developments in France that offer exemption from VAT, providing savings of nearly 20 per cent.

These holiday complexes, known as résidences de tourisme, are built by a developer who then sells the units to investors. They, in turn, lease them back to an operator who does all the hard work - including furnishing, letting, cleaning and general maintenance.

To encourage the building of tourist accommodation, particularly in the South, the French government exempts leaseback résidences de tourisme from VAT on the purchase price, currently 19.6 per cent. Irish investors have known about leaseback for years, says Laure Baldacchino of Chesterton International, but it is now catching on in the UK. “The best capital appreciation is in the Alps and the South - growth has been about 10 per cent a year,” she says.

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Most British investors are missing a trick by focusing solely on holiday lets when buying overseas. Assetz research reveals that much more reliable returns with a lot less work can be gained by investing in properties to let to the local market.

There is a common misconception that overseas property investment must mean holiday homes, with British investors competing fiercely over properties located close to airports, beaches and golf courses. Most of the rental income must be generated throughout the traditional holiday seasons when the properties are let to a series of holidaymakers for short
periods.

While these properties can undoubtedly generate strong returns, especially in counties with a strong tourist industry such as France, the alternative route into overseas property investment through letting to local people is usually more reliable, is much more a hands-off investment and is often overlooked.

Local lets are usually considerably less hassle for the investor, as one tenant will probably last for a year or two, perhaps longer, compared to holiday rentals which change every 1 - 2 weeks, often with long voids in low season and a high cost of ‘changeovers’.

Property in city centres such as Saint-Brieuc in Brittany, Montpellier in the Languedoc (France) or Limassol in Cyprus, expensive than in tourist hotspots, meaning investors can access better quality property at lower prices.

Stuart Law, Managing Director of Assetz comments:

“Amateur investors in particular are driven by the desire to holiday in their overseas property once or twice a year, therefore focus on holiday destinations which they might ultimately choose to retire to. However, with the time taken to manage the holiday bookings and the hassle of
arranging changeover/cleans between holiday let clients, it would make sense financially to consider separating the investment from any intentions for personal use and seek local let property.”

Assetz is selling locally let property in the Cotes-D’Armor near Brittany, France. This buy to let property is already occupied by tenants, so can be purchased as an immediately cash-positive investment. Where property in central Brittany is often inflated, smaller satellite towns surrounding the cities have an active professional market which demands
quality rental accommodation, providing an ideal opportunity for investors wishing to access the local French buy to let market. The apartments cost from EUR88,500 (£60,561) and are yielding 5% rental incomes, managed by a top class management company.

Assetz also has one and two-bedroom local let apartments in Limassol, Cyprus, for £70,000 - £100,000 Sterling with 8% yields available and a fully managed local service available, making it an ideal hands off and profitable investment.

Source: Firstrung.com