Ask the ex­perts

French Property News - - Contents -

An­swers to your ques­tions on French cit­i­zen­ship, fos­ses sep­tiques and B&BS

Is it eas­ier to buy an ex­ist­ing B&B in­stead of set­ting up a new one? Name sup­plied Sally Stone, di­rec­tor of prop­erty man­age­ment com­pany Les Bons Voisins (lb­ replies: The an­swer to your ques­tions is a pretty straight for­ward “yes”. If a cham­bres d’hôte is es­tab­lished and has the po­ten­tial of re­turn­ing guests, that will help you in the early stages when you are pick­ing up the reins of a busi­ness which is new to you. How­ever, when you say, “ex­ist­ing B&B” there is some back­ground as to how that busi­ness is pur­chased which may be of in­ter­est to you and will help your un­der­stand­ing and could po­ten­tially in­flu­ence your de­ci­sion.

It is un­likely that when you buy a prop­erty cur­rently used for bed and break­fast, you re­ally pur­chase a busi­ness as well. The norm tends to be that an at­trac­tive prop­erty has had two or three bed­rooms used by the own­ers as bed and break­fast rooms, but that when they come to sell the prop­erty, the ‘good­will’, if you like, for that busi­ness will en­hance the price they ask for the prop­erty, rather than there be­ing two trans­ac­tions, one for the prop­erty and one which would be for the sep­a­rate busi­ness.

When you pur­chase a busi­ness in France, you are pur­chas­ing a sep­a­rate ‘ fonds de com­merce’. Un­less the cham­bres d’hôte is more of a small ho­tel (the for­mer has a limit of five bed­rooms be­fore a plethora of reg­u­la­tions come into play) it is very un­likely that there will be a prop­erly au­dited and sep­a­rate busi­ness. For that to be the case, you would need au­dited books for the past three years and a sep­a­rate val­u­a­tion would be made for the fonds de com­merce. If by any chance you need to raise fi­nance to buy it, then any re­quest for a loan for your pur­chase would only take ac­count of the busi­ness if you were buy­ing the fonds de com­merce sep­a­rately. Any mort­gage loan would not be able to take into ac­count an en­hanced value which might be placed on the prop­erty by the ex­ist­ing owner, be­cause of the in­come re­ceived via their bed and break­fast guests.

Com­ing right back to your orig­i­nal ques­tion, it could be that pur­chas­ing a larger prop­erty not cur­rently used for bed and break­fast suits your bud­get bet­ter since there would not be an en­hanced value for the prop­erty.

And in these days of Airbnb which is fast grow­ing and an ex­cel­lent way to mar­ket bed and break­fast ac­com­mo­da­tion, it wouldn’t take you long to bring your new busi­ness to the at­ten­tion of some of the mil­lions of peo­ple who hol­i­day in France ev­ery year!

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