For a profitable rental investment, buy at the borders of Switzerland and Luxembourg
11 October 2017
Particularly numerous on the borders of Switzerland and Luxembourg, cross-border workers or "commuters" upset the real estate market. Haute-Savoie, Pays de Gex or Alsace have become areas of choice to invest and enjoy a tight market because of much higher wages (and rents) on the other side of the border.
360 000 workers at the borders with Switzerland and LuxembourgAccording to figures from the INSEE of 2012, today probably still less than the truth, 360 000 French residents work abroad and daily commute to a neighboring country. This figure is steadily increasing as these commuters are 55,000 more than in 2006 and 100,000 more than in 1999.
This phenomenon is particularly noticeable at the borders of Switzerland and Luxembourg where wages are higher than in France. The city of Geneva, for example, is attracting more and more French people and this attractiveness has in particular increased in recent years, as explained Sébastien Cartier, deputy president of Fnaim (National Federation of real estate) Savoie Mont-Blanc. Fourth largest financial center in Europe, the Swiss capital is facing real difficulties in the real estate sector: there is an explosion of purchase prices and a dramatic shortage of housing. The city of Basel is also very popular because of its financial, pharmaceutical and chemical activities, which are recognized for their excellence. Here again, rents have exploded.
The French who work in these cities, as well as more and more Swiss, are therefore seeking to lodge in France. Investing in these regions is therefore sensible. Provided you are well informed.
Investing in real estate on the border between Switzerland and Luxembourg: what you need to know
The first condition to be met in order to properly rent your accommodation in these border regions is to choose a municipality from which it will be easy to reach the large Swiss or Luxembourg cities. Ideally, these trips could be made by train in order to avoid terrible road traffic. Alternatively, choose cities served by the motorway. One of the most expensive regions, but also the most profitable, is the Haute-Savoie, very close to Geneva. For example, Invest- ment magazine selected the cities of Annemasse and Saint-Genis-Pouilly for their quality of accessibility, their prices still affordable and their vacancy rate very low. Farther from the border but equally prized, Annecy can also be a good choice and its rental vacancy rate is only 1.6%.
Less expensive - apart from the town of Divonne-les-Bains which enjoys an ideal location - the Ain, and particularly the Pays de Gex, is a good area to invest. Even if prices are not smoothed between the various municipalities. Finally, Alsace, from Saint-Louis (soon to be equipped with a tramway) in Mulhouse, is also to be considered for its proximity with Basle. However, the southern districts must be favored because, for better profitability, it is better not to settle too close to borders, where real estate is more expensive than in the rest of Alsace.
Tips and tricks
The most sought-after goods - whether by families or single people with high wages - are medium-sized. Tenants are demanding and will only turn to quality goods and preferably in the old. So avoid buying in the new, you risk to overpay the property and draw only an unsatisfactory rental yield.