Property Letter – February 15th 2005

Posted by admin in Property Letters | February 15th 2005

Dear All,

Vicky returned to Cape Town last weekend, and I follow her in less than two weeks, only for the month of March so that we can enjoy the “Two Oceans” on Easter Saturday as usual, and some time with the family. Adam and Alice have been with us in Europe for the last 3 months of their University summer break, but are back at work at UCT now (or so we are led to believe). We return to Cannes from early April until August.

For those who read this with investment in mind I want to bring two properties back to your attention.

As I prepare to leave Cannes there are two properties that are still available and beg to be seriously considered. Both have been written about before and both have rightly elicited a great deal of interest from potential investors. As we put our own reputation on the line with each and every investment recommendation, we do not do it lightly. Good properties are simply not easy to find, so that when a good apartment sells to someone outside our group, I feel a sense of missed opportunity – of loss. In addition, it is very difficult to find really good investment properties now under 5000 euros per square metre and both of these are in that range!

I wrote to you about this apartment in Property Letter 1st December 2004, but to save you having to go back to look for it, this is what I said:

Two bedroomed apartment.
Living space – 81 sq.m.
Balcony – 15 sq.m.
Asking Price – 405 000€
This is one of my favourite blocks in Cannes, with gardens and a lovely swimming pool for the use of residents. The apartments are all tastefully positioned in the grounds of the old Villa which is today part of the complex, comprising four luxury apartments itself. The lovely and exquisitely maintained gardens are expansive with green lawns and palm trees and flowers and shrubs. Although one is in the middle of Cannes, and only 3 minutes from the shopping street of Rue d’Antibes, and 10 minutes from the Palais des Congres (on foot), the apartment is quiet and private. It is on the 1st floor of a 3 storey modern apartment building (1990), and is remarkably spacious. There are two big bedrooms, and like the sitting room, they open up through big glass sliding doors onto the wrap around balcony. There are two bathrooms and a spacious kitchen and pantry and it has an underground parking space, and cellar. This apartment is ideally suited to high quality rentals, being positioned so close to the centre, and being quiet, and exclusive. We have many requests for this type of accommodation for all the congresses and for the summer season, but it is equally suite d to longer term lets if one preferred the regular income that this can guarantee. It is a wonderful apartment, and it has a rental track record which we can supply to anyone interested to see it.

There were three serious enquiries after the letter went out, and of course the first person to respond to me had the first option. For various reasons, including the Christmas holiday break, delays mounted up and weeks passed, until his side fell through. The second person pulled out too, and the third bought something else. Therefore we are in a situation whereby this apartment is once more available. We recommend it as strongly as before – circumstance has put it suddenly back on the market and that may be someone’s good fortune .

Reine Astrid
I wrote about this apartment just a few weeks ago in Property Letter 25th January, 2005. The fact that it is still available is no reflection on the apartment. Currently it is rented until 17th Feb which makes it difficult for anyone to show it to their clients. It will sell quickly – of that I have no doubt. This is what I wrote (and I see that I omitted to point out that it has private and enclosed parking):

Avenue Reine Astrid – Palm Beach
One bedroom apartment
Newly renovated
4th floor
Asking price – 292 000€
Living area 60 sq.m
Terrace 8 sq.m

This apartment has a spacious entrance hall leading into a lovely living room with a brand new open plan kitchen. Both the living area and kitchen open onto the balcony through glass doors, and there is a small dinning area, all open, between the kitchen and the balcony door. The balcony is wide enough for a small table and four chairs, and runs the length of the apartment.

The bedroom also opens through glass doors to the balcony, and has good spacious cupboarding.The bathroom has been redone in a very modern style. There is a large walk-in cupboard off the hall, which is currently used as a laundry.

The view is special. The balcony faces north, but offers a lovely open view to the east of the bay leading across to the Cap d’Antibes. To the West you look out across the remaining small villas around the place de L’Etang, and opposite is another apartment block. Therefore the view comprises one third seascape, one third apartment building and one third village. It is 50m from the beach.

Palm Beach is good for holiday letting, and performs well during conferences, although it is less easily rentable than the apartments which are in the centre.

Lower Budget Properties of sufficient quality are incre asingly hard to find and when we do find them they are often too expensive. Many people would like a smaller property to start with, or else their budget will not stretch beyond a small apartment and it is what they need. We find ourselves in a situation where we have “orders” and we search to fulfil them. Where we know what someone is looking for and his budget, and providing that person has some patience, in a few weeks or months we are normally able to get back to them with exactly what they need at a price that they can manage. It may well be worth your while spelling out to us what you require, and allow us to apply ourselves to finding it. In January we have been able to successfully find three excellent apartments for people who have been looking for them, at prices between 133 000 and 230 000. Each of them never really came onto the market, and none appeared in my Property Letters as they were gone before I had a chance to write to you about them.

Capital Appreciation. The main reason for interest in investment property is always capital appreciation. It is nice to have a place to use sometimes for holidays, and it is wonderful if rental income can cover or almost cover the mortgage and expenses incurred through owning the property, but capital appreciation is what sets property apart for those who believe in it. So I applied to the “Chambre des Notaires des Alpes Maritimes” which is the Chamber of Notaries for our Department of France (the Alpes Maritimes), for their statistics. Every property transaction has to go through a Notary. I have a number of pages of records now covering the period from the third quarter of 1998 to the second quarter of 2004, but what really interests me is th e figures relating to apartments in Cannes specifically, as that is the area we have focussed on.
• Using the fourth quarter of 2000 as a base for the index ( = 100 ) they track each quarter until the second quarter of 2004 ( = 154.3 )
• This represents a steady increase in prices amounting to 54.3% over the 14 quarters.
• This also represents an increase of 15.51% per annum over the period.
That is official and verifiable, and I would be happy to fax or send a copy of the report to anyone who is particularly interested.

There may well be another short letter before I leave on 26th, but that will depend on what comes up.

My kindest regards,

Sooner than I thought.
Yesterday I was ready to send this letter, and it will go today. I did not know this apartment was going to come through my door today.

I have not seen it from the inside and can not see it until next week because it has tenants who are delegates at the GSM conference this week. However, I am confident that when I do see it – it will be as I describe it. I have seen photos and I have faith in the person I am dealing with. (If it is not up to scratch there
will be no commitment of course.)

One bedroom apartment.
45 sq.m. living space
Price – 204 000 euros
3rd floor – no lift.
Also no balcony or terrace but many of these old buildings did not have balconies – it was not the fashion.
Position – less than 200 meters from the Palais des Festivals, the beaches, and the Croisette.
View – to the east and very light, it overlooks an interior courtyard and the terraces of the ‘Gray d’Albion’ 5 star hotel beyond.
The apartment has just been entirely renovated, furnished and equipped. It comprises a living room with open plan kitchen, bedroom with bath room, and a separate toilet. Mobile air conditioning.
Paint is beige/yellow, sponged texture, with light blue curtains in sitting room and bedroom.

The building is a small 3 floor block under renovation right now. The façade is light yellow and brand new, and all the communal areas are entirely renewed from floor to ceiling. (Work is ongoing now, and paid for). The apartment is newly and well furnished with a double bed and cupboards in the bedroom, and a double fold down sofa-bed in the spacious living room as well as a double sofa, glass topped side tables, TV and pictures on the wall. The kitchen is fully equipped with washing machine, electric 4 plate stove, fridge and freezer, microwave, grill and all are new. The apartment is fully and nicely furnished and is ready to let as it is. Includes a cellar.
Rentability – as good as it gets. (Most tenants will handle 3 flights of stairs if they are warned in advance, and particularly given the incredibly central position of the apartment.)
Very good value for money. (All subject to it coming up to expectation when I see it in the flesh, which I think it will.)

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