Is this your chance to pick up a chateau on the cheap?
The French are fleeing. A spate of proposed tax hikes is leading hundreds of wealthy French to consider leaving the country and putting their homes on the market, real-estate agents say. The result: the best opportunity in years for foreigners to buy a Parisian pied-à-terre or country château.
The number of high-end homes on the market has increased, with sales due to expatriations skyrocketing this year to several a week from a few a month, says Charles-Marie Jottras, president of leading luxury brokerage Daniel Féau. Fiscal expats account for more than half of the homes Daniel Féau lists between $6.4 million and $19.2 million, compared with about 10% in prior years.
Several high-profile businessmen have already packed their bags. Former L'Oréal Chief Executive Lindsay Owen-Jones has taken up residence in Lugano, Switzerland. Belgium now counts Amaury de Sèze, who served as chairman of supermarket giant Carrefour, as a local. Nicolas Chanut, founder of French investment advisory firm Exane, moved to London.
Flush French are fleeing the new government's attempts to repair France's public finances by increasing taxes on salaries, capital gains and household wealth. Among the controversial proposals in the 2013 draft budget is a 75% tax rate on salaries higher than $1.3 million, up from less than 50% currently. "Wealthy French are not that masochistic," says Mr. Jottras. The proposed taxes apply only to primary residents of France, however; those who buy a property as a vacation home and spend less than half the year in France will not be affected.
And with the economy keeping prices flat—or in some cases down for the first time in nearly five years—the market is looking particularly attractive for foreign buyers. Prices on luxury apartments and houses have fallen about 6% compared with last year, according to Mr. Jottras.
In an effort to get out quickly, some sellers are slashing prices. A technology entrepreneur's 5,382-square-foot restored Provençal farmhouse on about 15 acres of land is listed at $3.8 million, a 10% discount to the market value, says Philippe Boulet, who heads the St. Tropez and Provence office for Emile Garcin. The 19th-century home and its pool are surrounded by 100-year-old plane trees. The owner—who wants to remain anonymous—is leaving France because of the expected hike in taxes, and is rushing to move to the $2.6 million house he has bought in California, Mr. Boulet says.
read more: Why the superrich are fleeing France