Macron’s Property Tax Measures Put a Damper on British Second Home Ownership Dreams in France

Owning a holiday home in France has long been a dream for many Britons. However, President Emmanuel Macron’s recent property tax reforms are threatening to undermine this aspiration, according to the Daily Mail. The French government is increasing property taxes for owners of second homes in popular tourist areas, with some individuals facing a massive 60% increase in their bills. This crackdown is aimed at addressing the housing shortage in these regions. In this article, we will explore the impact of these tax measures on British second home owners, the areas most affected, and what it means for the future of holiday home ownership in France.

French Property Taxes

In France, there are two main property taxes: taxe foncière and taxe d’habitation. Taxe foncière is an ownership tax paid by the owner of a property, irrespective of whether it is occupied. On the other hand, taxe d’habitation is a residence tax paid by the occupier, similar to council tax in the UK. In 2023, taxe d’habitation was abolished for those with just one residence. However, it still applies to second homes and additional properties, affecting British citizens with holiday homes in France.

Starting from 2024, a surcharge of between 5% and 60% could be applied to taxe d’habitation for second home owners. Initially, this surcharge was limited to 1,136 councils in big cities and tourist resorts, resulting in a 60% increase in property taxes in areas such as Bordeaux, Lyon, and Biarritz. Even in Paris, the city council declared a 51.9% rise in property taxes. Now, an additional 2,263 rural areas have been given the option to roll out similar tax increases.

It is important to note that the exact tax rates for 2024 have not been published yet, making it a somewhat uncertain situation for homeowners. Homeowners should expect some clarity toward the end of the year, but it is still unclear whether taxes will continue to increase in the future. However, one thing is certain: property taxes are rising for second home owners in France, impacting the thousands of Britons with holiday properties there.

The regions most affected by these tax increases include Brittany, where 156 councils have been granted permission to raise residence tax by up to 60%. This affects approximately 12% of the region’s properties, potentially impacting 8,900 British second home owners. The Jura region in eastern France is also facing tax hikes. For example, Lebby Eyres, who has owned a second home there for the past 11 years, expects her property tax bill to rise by about 11.5%, totaling to approximately €2,500 annually.

Kate Cherry, who owns a four-story townhouse in Occitania, southern France, is also anticipating tax increases. She pays taxe d’habitation for the apartment she uses as her main dwelling when in France. However, she is unsure about the amount her property tax bill would increase as she awaits the decision of her village council. Kate is concerned about potential hikes, as her village heavily relies on tourism, and any substantial increase could adversely impact businesses in the area.

Conclusion

President Macron’s property tax reforms in France are threatening the dream of owning a holiday home in the country for many Britons. The increased property taxes, with potential surcharges of up to 60% for second homes, are making it financially burdensome for British citizens to maintain their French properties. The regions most affected, such as Brittany and the Jura region, may see thousands of British second home owners reconsidering their investments. Additionally, the Brexit-related limitations on the duration of stays in EU countries further constrain homeowners’ ability to enjoy their holiday homes. The attractiveness of domestic holiday homes in the UK is also growing, as more Britons opt for property ownership within their own country. These changes pose significant challenges for British second home owners and could redefine the future of holiday home ownership in France.