The way we holiday is changing and it's good news for property owners looking to make money from renting out a home abroad. We're becoming more sociable with a trend for holidaying in larger groups.
Holiday company Abercrombie & Kent saw a 30 per cent increase in demand for multi-generation holidays to family-friendly destinations this year. Large groups need large properties and in cash-conscious times, rentals can be far more attractive than pricey hotels.
Ten years ago the owners of large, historic property rarely chose to let out their homes but that's changing too, say French châteaux specialist Sifex which has noted an increase in owners of larger property keen to earn an income from it.
"A successful emerging trend is the purchase of châteaux to rent out for weddings," says Sarah Francis of Sifex. "These are most successful in areas like the romantic wine region of Bordeaux where there is an international airport, a TGV station and so much to see and do. A quiet, peaceful setting is popular, people like a rural or village setting, but not an isolated one."
The ideal larger rental property has a good ratio of bathrooms to bedrooms, a heated swimming pool and good facilities within easy striking distance.
In south-east Dordogne close to the medieval market towns of Souillac and Sarlat, Château Raysse has been rented out to large groups and wedding parties for six years.
The oldest part of the château, a sweeping stone turret, dates back to the 11th century. Along with an adjacent manor house and pigeonnier it sleeps 35 guests. Outside there are 30 acres of gardens and agricultural land fed by the Dordogne River.
Michael Smith, a Dublin-based barrister, bought Château Raysse in 2004 as both a family holiday home and a rental business. He charges £6,500 to £11,750 a week for the entire property and earns up to £148,000 a year from 16 weeks' occupancy.
"Most of our business is made up of wedding parties who book for a week," says Mr Smith. "With 17 bedrooms this château is bigger than most and has an unstuffy informality people like."
Mr Smith, 45, employs a young, energetic couple, Jenny and Laurent, who act as guides, cooks and party planners for guests, and a full-time gardener. Typical charges for live-in managers are £21,700 to £26,100.
Château Raysse feels like a well-used and much-loved family house. All but two bedrooms are en-suite and there are two pools and a games room.
It sits in a quiet area of pretty villages, historic castles and local markets selling fabulous local produce.
Brive airport is 20 minutes away with City Jet flights from London City Airport, and Bergerac, Limoges and Toulouse airports are within 90 minutes. A growing family and business interests back in Dublin mean Mr Smith is now selling the château for £1.39 million.
His best annual gross rental yield has been over 10 per cent.
MAKING IT PAY
Rental property in France can return a reasonable income but it won't make you a millionaire says Margarete Isherwood of Jacwood Estates who runs courses for would-be gîte owners. The biggest mistake, she says, is to underestimate the costs.
"Rental income has less to do with area than with presentation," she adds. "People want to holiday in Normandy as well as the Cote d'Azur but they all want to stay in a well-run and well-presented property."
She also warns that France is not a year-round market. "On average you should expect guests for three months of the summer but many people shut up their houses outside of peak holiday times," she adds.
Château Raysse: chateaudordogne.com/forsale; 00 353 876 776 140
Sifex: sifex.co.uk; 020 7384 1200
Jacwood Estates: jacwoodestates.co.uk; 01926 883714
NEW CAPITAL GAINS RULES
New French capital gains tax on second homes comes into force in February next year, taking the rate to 32.5 per cent. This has made sellers realistic about prices and more motivated to sell this autumn says Knight Frank's Mathew Hodder-Williams (knightfrank.com).
"In the Dordogne there are too many properties on the market, so location and quality have never been more important," he says. "Interest is highest within 45 minutes of Bergerac in villages like Eymet, Duras and Issigeac."
Expect to pay from £435,000 for a pretty three- or four-bedroom townhouse with substantial garden in one of these villages, while £870,000 buys a fabulous Maison de Maître or spacious white stucco farmhouse.