Posted by admin in Property Letters | November 6th 2008

Dear All,

“Call the Bottom Dad!” …is what Lao said to me recently.

We were talking about the market and the release of the “Residential Market Review for the third quarter 2008, published in October by CB Richard Ellis, a worldwide property consultancy firm who publish research results and market reports which are respected by professionals in every field of activity. (See extracts below)

We were also discussing the state of mind (the happiness) of people who have investments, and where those investments are:

  • In Sterling and the Rand? Not happy.
  • In stocks? Not happy. The less said about that the better.
  • In UK property? Not happy.
  • In Euros? Happy.
  • In French property? Happy
  • Don’t we all wish we’d bought into gold!

So I am “Calling the bottom” albeit a shallow one, but one in which there are some cherries to be picked.

Prices in Cannes and elsewhere on the Cote d’Azur have stagnated through this year, and in some cases they have come down. Some wonderful opportunities exist and I would say that almost everything on offer is open to negotiation. Asking prices are quoted but I believe we can achieve significantly below the asking price in some cases, and in a few we do have “distressed sellers” prepared to accept what they would previously have considered ludicrous.

I do not expect prices generally to go any lower. On the contrary there is a drying up of supply as sellers who are not under any pressure to sell sit back and wait for the market to pick up again, which it will.

There is no sense of panic here.

In addition banks are actively lending and rates are coming down. Savvy investors are taking up the cherries one by one, and some who are not too heavily leveraged already are using this time to invest again, right now. I can not think of a better time to do so.  Optimism is rising.

Commentary on the French Markets:

The CB Richard Ellis assessment of the French market in general is that although France and the Euro zone are experiencing a mild recession already, and consumer confidence is very low, “inflation seems to have passed its peak”. Economists suggest that GDP will rise by only 1% this year and next, but a healthy first half means that business investment will remain positive for 2008 and INSEE (National Institute for Statistics and Economic Studies) estimates a reasonably healthy 2.4%.

Investment in commercial real estate is significantly down but the report on “Homeowner Sales” is more encouraging. “The real-estate cycle may have passed its peak in France, but the market has remained healthy. Demographic and structural changes in the market fuel demand, enhanced by the relatively low level of home ownership in France, 57%, compared to 67% in the Euro zone.” Of course the market is curbed by general economic uncertainty, credit is more difficult to obtain, and there has been a cut back in new construction projects. This “period of adjustment” is expected to continue through 2009 and into the beginning of 2010, but CB Richard Ellis point to the exceptions that exist in the “high grade housing” market in Paris. The same rules apply to “high grade” properties in niche markets elsewhere in France, most notably in the French Riviera and the main ski resorts:

“The micro-market for luxury assets…is getting stronger year by year.” These high grade apartments and town houses, in addition to their size and specifications, can be split into three categories:
•    The location – some locations are considered more exclusive than others.
•    The architecture and the design – dimension stone buildings, apartments with large reception rooms, original features such as mouldings, carvings, large gardens or terraces are highly prized.
•    The security – buildings with high security, video surveillance, secure entrances etc.

“This sector appears to be relatively protected from the downturn of the property cycle with the accompanying drop in prices. The motivation of this clientele is not always very rational, and does not necessarily involve the same logic that most buyers exhibit. A transaction may almost be concluded on a whim.”

•    The number of these types of transactions has increased by 200% since 2005.
•    The share of foreign buyers has risen sharply in the last decade.
•    The top end of the market should continue rising which will no doubt lead to more luxury apartments being developed.

Why get excited about all this?

For nearly 7 years I have been telling close friends and family and people I have never met that there is something SPECIAL about this particular property market. The French Riviera is unique, and Cannes particularly so.
•    Cannes is the equivalent of one of the TOP arrondissements in Paris. Who would argue that?
•    Successful and discerning people from every walk of life want to be here – just a few nights ago I watched James Caan a “Dragons Den” millionaire interviewed, and when asked what he does for pleasure his reply started with “Well, if I’m not in Cannes….”
•    From International Living Magazine’s annual Quality of Life Index, their 30th consecutive survey: “…which country wins this year’s Index? France and it takes this honour for the third year in a row. France is the best place in the world to live.”
•    France is host to more visitors each year than any other country in the world.

This assessment comes from Citywire’s Personal Investor Edition (1st November 2008):

“Even if we have doubts that it is the best time to invest in property, nobody knows when the bottom of the market will arrive and property should always be treated as a long-term investment. In the current climate, there are enough concerns about where we can put our money safely. At least with property, you know it is there and it cannot be taken away, even if the value may fluctuate.”  With property in a “high grade” market that confidence is doubly justified.

The high cost of oil and today’s economic uncertainties mean that flying off for a holiday overseas is going to become prohibitively expensive for many people or just an unwise idea, certainly for more than one holiday a year.
That self-catering apartment in Cannes might just make a perfect alternative.


History was made this week.

Whether we would personally have voted for him or not is irrelevant now – a convincing majority of the biggest turnout of American voters in 44 years have demanded REAL change, and remember that 76% of Americans are white, so the groundswell we have just witnessed has crossed all demographic barriers. The “Obama Effect” will be profound on the psyche of every American and will change the way they see themselves, and change the way non-Americans see them too.

I am filled with hope for America and our world.

A Brief Stocks Update.

Last time I wrote I bemoaned the fact that the FTSE 100 had dropped into that “dark place” below 4 000. It came up again thankfully!

At the time of writing the FTSE 100, the French CAC 40, the German DAX 30, and the Pan-European Dow Jones Stoxx 600 had all risen for six consecutive days – the first time they have managed that in the whole of 2008! The pre-Obama bounce perhaps? The FTSE 100 was hovering around the 4 500 mark and I have every hope that the rise will continue (with inevitable hiccoughs) on the backs of the Obama landslide and a probable cut of 0.5% to 1% in interest rates by both the E.C.B. and the Bank of England on Thursday 6th.

There seems to me to be a simple logic that business confidence = confidence in general: Greater confidence = rising markets + freer lending policies in the banks: Freer lending + confidence + rising markets = greater economic activity generally + returning stability to the real estate market.

All are inextricably connected.

Breaking news – as I prepare to send this the Bank of England has sent a powerful message to lenders – they have just cut interest rates by a completely unexpected 1.5%! We shall see if the ECB will follow suit.

As always, please let me know if you would rather not receive these Property Letters and I’ll remove your address from the list.

Please have a look at our website – comments would be welcomed:

With kind regards,


•    The prices quoted are asking prices only.
•    The selection offered in the Property Letter represents a few properties chosen from many, so if what you are looking for is not here, we can tailor-make our search for you.

I will only highlight four properties today as it is not long since my last Property Letter, but each of them might represent an opportunity. I will however remind you below of some of the properties that I feel worthwhile revisiting, and give you a web link to them.

Please remember that if you follow the links you will be able to read about the properties, look at a gallery of photos, and look at the position of the property on a map. Its worth the visit to the site. On the site you will also find all my old Property Letters and articles that I have written from time to time.

Bas Croix des Gardes.
Two bedroom apartment.
See header photo at the top of this letter – she’s a beauty.
•    100m² of living space.
•    3rd floor of 5.
•    Construction – late 19th century.
•    Exposition – full south, east and west.
•    View – across gardens to a panoramic sea and the Esterel Hills in the west.
•    Balconies off all rooms.
•    Asking price 867 000€.

Just west of the centre of Cannes and rising slightly above it is a suburb called Les Croix de Gardes. It is a lovely and quiet old suburb with some gorgeous old buildings and Palaces, and this is in the best of those.

The apartment is on 3rd floor of the building on the eastern corner.

The building itself is grand and historic and of course protected, but parts of the interior such as passages and stairwells require some attention, and this work has been voted for and paid for. Some of the photos show the vast and ornate period entrance halls. The gardens are extensive and well maintained. The view (full south) is stunning and panoramic of the whole Bay of Cannes to the Esterel Hills in the west, where the sun disappears. The classic low building in front (also visible in some of the photos) is the Rothschild Villa which is also protected (listed as an important historic building) so the view is guaranteed for ever – nothing may go up for 500m on either side.

The apartment has a large entrance hall, a big living room and two bedrooms both opening onto balconies, and the magnificent view. All of these rooms have the original moulded cornices and moulded ceiling medallions for chandeliers. It has a very large main bathroom and separate shower and toilet, a large equipped kitchen and a second toilet. There is ample space to enclose the area leading to the second toilet in order to create a second bathroom, and the plumbing is already in place. That is the only work that is recommended or necessary, and it is minimal.

The living space is 99.7m²
The balcony runs all along the front and each bedroom has access. It is not a wide balcony as they were not in these grand old buildings, but it is quite wide enough for table and chairs.

The property has a reception area, a guardian and security.
Parking is free within the grounds for residents and there is a large cellar in the basement.

This property has all three important elements which distinguish a “high grade” or “luxury” apartment:
•    Position and view.
•    Architecture and design.
•    Security.

Golfe Juan.
Two adjacent studio apartments.
•    Living space – 27m² and 23m².
•    Ground floor of a 3 storey building.
•    Construction – early 20th century.
•    View – onto a terrace / small garden.
•    Asking prices – 125 000€ and 115 000€

The apartments are being sold separately, or as a pair and I fully expect the price to be negotiable. Golfe Juan is just 5 kilometres from Cannes, sitting on the Bay just east of us. The road linking the two runs along the coast and it is all very much part of the Cannes commuter belt, in addition to which it is just one train stop away – so literally 10 minutes by car from Cannes, or by train.

These two apartments have been created in the basement of an attractive and newly renovated three storey building dating back to early last century, and they are in the centre of Golfe Juan, on a clean and busy shopping street, just a two minute walk from the station and five minutes from the beaches. They both open via large glass doors onto an enclosed terrace / small garden without any views, but nice to have for the extra space and air.

Each apartment has been newly renovated (and not yet lived in) and comprises a living / sleeping area leading onto the terrace, an open plan kitchen and a bathroom off an entrance hall. They do adjoin each other so it is possible to combine the two, or use them separately. At the moment they link via the entrance passage, or via the terrace (outside), however it might be possible to put in an interconnecting door if desired.

Golfe Juan is a pretty and popular seaside village, but Vicky and I have no real experience of working there. However it is very close to Cannes and we would only recommend this investment for someone wishing to put long term residential tenants in the apartments. In this role it should be fine, and the prices are significantly more affordable than anything similar in Cannes. Should anyone be tempted or wish to make an offer, we would recommend that we do further “due diligence” before going ahead.

Rondpoint Grande Bretagne.
Very large one / two bedroom apartment.
•    Living space 82m²
•    Terrace – wrap around 25m²
•    Ground / first floor of 5.
•    Construction 1952.
•    View of gardens, trees.
•    Aspect – east, south and west.
•    Double garage, parking and cellar.
•    Asking price – 371 000€.

This is a residential apartment just out of Cannes centre in the suburb of Le Cannet. For anyone wanting to live here, or wanting a residential rental income this is a very good option, and the price IS very negotiable (because the seller is in a hurry).

The apartment is on the ground floor from the street, but as the ground falls away from the apartment block, it is on the first floor from the front of the building, so the expansive south facing terrace overlooks shrubs and trees and apartment buildings and houses much further away. It really is exceptionally quiet.

The owner has renovated the apartment in the last four years, with new tiled floors, kitchen, and bathroom, and has knocked out the second bedroom to create a huge living area in three parts – living, dining and office. The layout is very appealing because of the large living space but it would be a simple enough matter to re-erect the wall and claim back the second bedroom if required.

The double garage will take two smaller cars, or a big car and a lot of extra storage space. The cellar is clean, shelved and spacious, and there is enclosed parking for residents if the garage is not enough. The building is very sound although common areas are looking as if a coat of paint wouldn’t go amiss – but it’s fine – just in need of freshening quite soon. The monthly levy and the tax fonciere (council tax) are very low, partly because it is not in central Cannes and partly because of its age.

With web-links.

Jean de Riouffe.
Large studio apartment in the centre.
•    37m² of living space.
•    1st floor.
•    Aspect – east.
•    View of street leading to the Palais des Festivals (200m)
•    Fully renovated, furnished and ready to work.
•    Double glazed.
•    Asking price – 230 000€

Village Sablons – Palm Beach.
One bedroom apartment.
•    35 / 38m² living space.
•    Small balcony at front and small closed in balcony at back. (Potential to expand this west-facing balcony and make more use of it.
•    Aspect – east and west.
•    Fully furnished.
•    Asking price – 235 000€.

Bas Stanislas.
One bedroom apartment.
•    51m² of living space.
•    2nd floor of 6.
•    Exposition – south and west.
•    View of city and hillsides.
•    Balcony off living room and another off the bedroom.
•    Gated parking for residents.
•    Asking price – 240 000€

One bedroom apartment.
•    34m² of living space.
•    4th floor of 7.
•    Exposition – south.
•    View across gardens to apartment buildings beyond.
•    Large south facing balcony.
•    Asking price – 275 000€.

La Croisette.
Large studio apartment.
•    40 m² of living space.
•    1st Floor of 7.
•    Construction 1960.
•    View over gardens, La Croisette and the sea.
•    Exposition east, south and west.
•    Terrace.
•    Gated parking in the complex.
•    Air conditioned and double glazed.
•    Asking price – 320 000€.

Rue d’Antibes.
One bedroom apartment.
•    55m² of living space.
•    1st floor of 6.
•    Construction – 1985.
•    Exposition – north.
•    View – city.
•    Asking price – 385 000€.

La Croisette.
One bedroom apartment.
•    35m² of living space.
•    1st floor of 8.
•    Construction 1980.
•    View – panoramic of the Croisette, gardens, Port Canto and the sea!
•    Lovely west facing balcony overlooking the Croisette.
•    There is a cellar in the basement and the possibility of a garage.
•    Asking price – 395 000€

Palm Beach.
Two bedroom apartment.
•    57m² of living space.
•    One bathroom with toilet, separate shower and toilet.
•    Balconies east and west.
•    1st floor of 5.
•    Air-conditioned and double glazed.
•    Fully furnished.
•    Private parking.
•    Asking price – 450 000€.

Petit Juas.
Two bedroom duplex.
•    100m² of living space.
•    2nd & 3rd Floor of 3.
•    Bourgeois building – built 1902.
•    Exposition – South / West.
•    View – across the pretty suburb of Petit Juas.
•    Very generous living and dining area on 2nd floor.
•    Well equipped and spacious open plan kitchen with views to the east.
•    Two upstairs bedrooms.
•    A bathroom on each floor.
•    Narrow balcony runs the length of the 2nd floor.
•    Asking price – 480 000€.

Victor Hugo – Top Floor.
Two bedroom apartment.
•    75m² of living space.
•    6th floor of 6.
•    View – panoramic of rooftops and the hillsides overlooking Cannes.
•    Exposition south, west and north.
•    Large balcony.
•    Asking price – 520 000€.

Isola Bella close to Cannes centre.
Two bedroom two bathroom apartment.
•    78m² living space.
•    1st floor of 2.
•    Large east and south facing balcony.
•    Fully furnished.
•    Air conditioned and double glazed.
•    Garage and cellar in the basement.
•    Asking price – 550 000€.

Marachal Joffre.
Three / four bedroom apartment.
•    91m² of living space.
•    1st floor of 3.
•    View of the street leading to the Palais des Festivals.
•    Exposition west and east.
•    Enclosed terrace off the two main bedrooms.
•    Asking price – 837 000€.

(Make an offer!!)
Plage du Midi.
Three bedroom apartment.
•    125 m² of living space.
•    35 m² of terrace.
•    Three big bedrooms.
•    Three en-suite bathrooms.
•    Built – 1900 (Bourgeois)
•    View – panoramic sea views.
•    Aspect – north, south east and west.
•    Floor – 2nd of 3.
•    General condition – excellent.
•    Double glazed and air conditioned.
•    Garage and private parking.
•    Cellar.
•    Private steps down to the beach.
•    Asking Price – 1 700 000€

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