Why is real estate on the French Riviera so popular?

24th Apr 20
Why is real estate on the French Riviera so popular?

There is no doubt there is a certain mystique to the French Riviera, otherwise known as Côte d’Azur, taking in the likes of St Tropez, Cannes and Monaco. Situated on the Mediterranean coast of south-east France this is an area of the world dominated by the rich and famous. Beautiful weather, fine dining, designer shops, and nightclubs create a social life which is difficult to match anywhere else in the world.

The French Riviera also has more than its fair share of Michelin star restaurants, sandy beaches and global events, taking in the likes of the Cannes Film Festival and the prestigious Monaco Grand Prix. In many ways, we have already answered the question as to why French Riviera real estate is so popular!

Who is buying French Riviera real estate?

It will come as no surprise to learn that 70% of the largest residential properties across the Côte d’Azur are owned by non-residents. There has been increasing demand from British, Middle East, Swiss, German and Italian buyers in recent years. As with many other luxury property markets around the world, there is also increasing demand from Chinese and Asian investors. However, after previously being very active across the French Riviera and London, interest from Russia is starting to decline. Indeed, many real estate agents have confirmed there are currently more Russian sellers of French Riviera property than buyers.

China and Asia have seen the emergence of numerous millionaires and billionaires in recent years as their economies continue to boom. We’ve also seen an array of influential technology companies spreading their wings out with China and Asia into the global market – often creating huge wealth for their founders. Many experts believe that the current trends will continue for the foreseeable future which will further increase competition for real estate on the French Riviera.

Let’s not forget superstars such as Elton John, Bono, Ralph Lauren, Johnny Depp and Tina Turner already own properties along this exclusive Mediterranean coastline!

Funding for French Riviera property

Even in these challenging times, with the coronavirus holding a vice-like grip on economies, the luxury property market has remained relatively stable. In reality, there is no region of the world or business sector untouched by the virus but luxury real estate is still extremely popular amongst the rich and famous. This ongoing demand has fuelled an array of funding options with some of the more popular routes including:-

Property refinancing

With Eurozone interest rates flirting with the negative territory and the Bank of England base rate currently standing at 0.1%, it is difficult to think of a more appropriate time to consider real estate refinancing. While some speculate that Eurozone and UK base rates may fall further in the short to medium term, the economic crisis engulfing the region requires huge government investment as opposed to simply reducing base rates. It is no surprise to learn this has prompted significant activity amongst French Riviera real estate owners many of whom have also seen a significant rise in the value of their real estate assets in recent years.

Equity release

Interestingly, while many other luxury property markets around the world are attracting significant interest in equity release plans, this is not currently a prevalent trend across the Côte d’Azur. Whether this might change in the short term if demand for liquidity, cash flow and funding for future investment opportunities increases, remains to be seen. As many equity release mortgages are negotiated on relatively low LTV ratios this can in some case help to circumvent the ongoing challenges with physical property valuations.

Bridging loans

There is a degree of concern regarding bridging loans due for repayment/refinancing within the next 3 to 6 months. These concerns tend to revolve around property developments, where valuation uplifts have already been factored into exit strategies. When it comes to more traditional residential bridging loans there is still significant activity amongst ultra-high net worth and high net worth individuals seeking properties on the French Riviera. Recent LTV ratios for bridging finance have been anything up to 60% although these are currently being considered on a case-by-case basis.

Development loans

As we touched on above, there is some concern regarding commercial development loans due to completion dates being pushed back and additional costs incurred. Currently, these are also being considered on a case-by-case basis and will depend upon the current property value, potential uplift, project timescale, cost and any additional collateral which can be used. This lending market is certainly not closed for ultrahigh net worth and high net worth individuals looking towards the French Riviera but individual circumstances will dictate ultimate terms. Learn more about development bridging loans.

As you would expect, those looking to secure finance for real estate investment on the French Riviera are seeking the highest LTV ratios, lowest amount of AUM as well as market leading rates. In recent weeks we have seen the partial closure of various elements of the retail lending market. This is not the case with private banks/niche lenders with around 80% of our regular partner still open for business. In many ways, it is their flexibility with regards to not only local but also worldwide income/ assets and the use of AUMs which injects a further degree of support to the benefit of all parties.

What can Enness do for you?

The vast majority of Enness employees are now working from home with access to our robust IT system. In effect, it is business as usual as if they were working from their desks with access to all of the tools and communication systems they require, all delivered within an ultra-secure environment. In relation to individual funding requests, there is a greater focus on bespoke structures and an increased element of “thinking outside of the box”.

In reality, bespoke funding structures are our forte allowing is to utilise our private bank/niche lender contacts for the benefit of clients. As we touched on above, there has been a partial closure of the traditional retail lending sector but as far as many private banks/niche lenders are concerned it is still business as usual. Indeed, we have seen a significant increase in traditional mortgage refinancing as well as creating bespoke solutions to bridging loan issues.

Lending criteria

We work very closely with a panel of global lenders who, unlike traditional retail lenders, are more appreciative of worldwide income streams and worldwide assets. This is perfect for many ultrahigh net worth and high net worth individuals who often have an extensive global footprint. The use of multiple income streams and global collateral ensures that clients are able to secure funding at competitive rates and there is additional insurance for lenders. The use of AUM arrangements also adds another degree of certainty for lenders as well as offering the potential to expand lender/client relationships going forward.


No area of business, everyday life or investment market has escaped the impact of the coronavirus pandemic but the luxury real estate market has remained relatively steady. Interest in the French Riviera continues to grow, funding options aside from traditional retail lenders are still competitive and there is significant liquidity in the markets – especially with base rates so low.

As we experience in the course of our normal business activities, the flexible nature of private banks/niche lenders is much appreciated. This can make a huge difference with regards to the often complex finances of ultrahigh net worth and high net worth individuals. If you have any short, medium or long-term funding requirements, we would welcome the opportunity to speak with you directly. Learn more about French mortgages for non residents.