Thu, Nov 1, 2012, 3:51 PM EDT - U.S. Markets close in 9 mins.

France's 'Rich' Tax = Deals on Paris Mansions

France's new 75 percent income tax on the rich may not be popular with millionaires. But it's being cheered by another group: Paris real-estate buyers.

Real estate agents say that the number of multi-million-dollar real-estate listings in Paris has jumped more than 25 percent over last year -- due in part to the threat of the new income tax. More than 400 new listings have come onto the luxury real-estate market over the past six months, they say.

It's not a sell-off. And brokers caution that the increase in listings brings overall inventories at the high end to normal levels after unusually slim listings last year. Because of building restrictions in Paris and other French cities, the number of homes for sale is still limited.

There are only about 8,000 properties sold each year for prices over $1 million or more.

(Read more: Affluent Retirees Prefer Good Weather to Lower Taxes)

Still, brokers say the 75 percent tax on the wealthiest French citizens has contributed to the decision by many of the them to sell their homes in anticipation of a possible move to another country.

"There is a real flow of French people leaving because of the taxes," said Charles-Marie Jottras, president of Daniel Feau Group, the luxury real-estate brokers in Paris.

Brokers say prices are down over last year, but only around 5 percent.

"The Parisian market is still very popular and it is so small that it is preserved from a price collapse," according to Coldwell Banker Previews International in France. "There are virtually no new-built homes."

Still, for a market that has historically had very little inventory of homes for sale, the pop in listings has given mansion buyers far more choice.

"There is now a better balance between buyers and sellers," Jottras said.

(Read More: Billionaires Get 'Low-Income' Tax Breaks in Condo Tower)

Brokers say that many of the buyers of French real estate are wealthy foreigners, who would not be hit with the new taxes. Russians and Middle East buyers top the list, they say, followed by Europeans, Americans, Latin Americans and an occasional buyer from Asia.

So what can a few million euros buy in Paris these days? (Read More Below Image)

Not a whole lot. For the equivalent of $5.7 million you could buy a 1,900 square foot apartment in Saint Germain des Près. The three-bedroom apartment is on the fifth floor and sixth floor of an old building and features a "skydome room" with a kitchenette.

If you have more like $11 million to spare, on the other hand, you might be interested in a 4,800 square foot townhouse on Avenue de Boufflers in Villa Montmorency. The home features six bedrooms, a wine cellar, two kitchens and play room. 

(Read more: Five Trophy Properties in Europe)

For $3.4 million, you can get an 1,800 square-foot pad "in an old building with balconies," according to the listing. It has two bedrooms and two baths.

For $18.6 million, you can buy a 5,200 square home in Paris, at top, with four bedrooms, three living rooms and a 1,000 square foot terrace.

If St. Tropez is more to your liking, there's this pink waterfront mansion for sale for $45 million. The 1930s villa used to be a hotel popular with celebrities, and features a stunning salt-water pool overlooking the bay. It's got 6 bedrooms, a 2000-bottle wine cellar and caretaker's house.

"These kinds of sellers would like to sell, but they are not prepared to lower their price dramatically," said Jottras. "They don't have to sell."

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115 comments

  • notsofast  •  19 hours ago
    the rich will never have enough
  • notsofast  •  19 hours ago
    better feed the poor or else they will come and take what you have by force
  • notsofast  •  19 hours ago
    the rich in france have forgotten the last revolution there where the rich lost their heads to the chopping block
  • Mitch Tank  •  14 days ago
    It will definitely be interesting to see how much revenue this tax generates. Personally, I just have a major problem with telling someone that just worked a 14 hour day that only 3.5 hours of that time was for him and the rest was for everybody else.
    • big daddy 10 days ago
      give me the money, dam i could get along with 100,000 a year ok who needs a jet not me 1000,000 home?? not me
  • Mark  •  11 days ago
    75% tax. Regardless of how much you make it is a crime that a Government or any agency would say you must give us 75% of what you make. so wrong!!
    • Dolly 10 days ago
      IT is wrong Mark....so wrong that one day the prince of peace will come and make it all right.....

      So far governments seem to have the notion they own you and your money and they can take what they want.......

      America has been going down that slippery slope for a long time and if it does no turn around and the Americans take back their country for the people and by the people....there will be no where one can go and have freedom...

      Taxation without representation....

      That is why the TEA Party. Taxed Enough Already
  • Tailgunnar  •  14 days ago
    Atlas is warming up for that big shrug...
  • Grafelfing  •  13 days ago
    Its about time we outlawed Rich people, who needs em', what are they good for? Jobs? Psshaaww, we've got government for jobs!
  • Scott F. Sedlazek  •  14 days ago
    A 1,900 square foot condo in Paris for $5,700,000 US is not a rock bottom price, and what about parking?
    Unless there is another war in France, prices on homes there will remain high even with a 75% tax rate which makes sense because of the French Government's fear(s) of the workers who are presently staging violent protests at wealthy factories and in other places also. What one of the Socialist or Facist groups in France will do is plan for and stage a protest outside of a big factory when the main companys' middle to upper management are there to visit or to do an audit or whatever they are there for, and the Socialist or Facist Group will organize disgruntled workers, and the protestors will usually burn tires because they burn for a long time and they throw off that nasty smoke which is kind of frightening if a person has not seen that before, and then the companys' management reports this back to the principals of the main company, and they complain to the French Government which has a Socialist leader now, and they must sooth the majority of the people in France who are having a difficult time financially, and whamo there you have it a 75% tax on whatever rich is in France.
    Another thing that the protestors tend to do is follow the visiting management back to their hotels, and then set tires on fire there too which is basically saying to the principals of the company that they will be lighting tires on fire in front of your house if their demands are not met.
    The Leaders of France are only in power because of the violent French Revolution; otherwise, King Louie XXV would be in the throne today.
    John Lennon said it best, (Paraphrase.) " No good ever came from a violent revolution. ", and that is the truth.
    And if you think about it for a minute or two, if the price of a mansion in Paris drops in price because rich people and rich companies are moving out, then based on how the real estate market prices houses by comparing prices in a neighbor even if that neighbor is the entire Country of France, all house prices will drop all over France because that is how the real estate business works. It is a market just like any other market, and that is how markets work and react especially during Socialist or Communist or Nazi revolutions. Where did real estate on houses or land ever increase after these parties took over a nation? Seriously.
    The Saint Vincent de Paul Society was formed and is still Headquartered in Paris, France for a reason if you read Our history, and the words of Our Founder.
    " FEED THE WORLD-ONE DAY AT A TIME (R) "
    " FEED THE WORLD-ONE DAY AT A TIME (R) "
    " FEED THE WORLD-ONE DAY AT A TIME (R) "
    " FEED THE WORLD-ONE DAY AT A TIME (R) "
  • Bill W  •  14 days ago
    I still can't afford a St. Tropez tan
  • W.D.  •  14 days ago
    The French like our money but they don't like us.
    • Jim 14 days ago
      could you ask your french friends why they are so lazy ! get to work
  • Greg Williams  •  15 days ago
    so what will france do after they all leave and there is no one else to tax....can we say ghetto..
  • Scott  •  14 days ago
    Do you see how this socialism nonsense of take from people that worked hard to save, invest and build wealth....and then give it to those who choose not to, doesn't work? And our current administration wants to keep raising taxes and head that direction.....just use your brain, it doesn't work.
    • R 14 days ago
      Actually, it is basic economics. If regs are lifted & Obamacare is revised giving small businesses a little breathing room, they will start looking to growth again & hiring again. Ouila! More jobs!

      My livlihood depends on small businesses and these past 4 years have been very lean. I talk to small business owners every day, and many are just holding their breath hoping for the best - NO MORE OBAMA & HIS GANG. If Obama is re-elected, and Obamacare stands, many businesses I provide services to will start laying off people to avoid compulsory Obamacare fees (taxers) they simply cannot afford. Why should a small business owner work 80 hours a week and deal with all the headaches of running a business to net 50K - 80k annually? Would you?
  • JR  •  14 days ago
    Coming to America with the re-election of Obama........socialism that will make Western Europe look like staunch capitalists. We will look more like Venezuela than the formerly greatest country on the planet.
  • William M  •  14 days ago
    Hasn't socialist France run out of other people's money yet?
  • ERA  •  14 days ago
    Sad, but predictable. When governments give free entitlements in order to buy votes, and expect that when they run out of money since very few pay taxes, (sounds like the 47% or half the U.S.), not surprising that people will flee the country to prevent the govt. from stealing their wealth.
  • Socialist Republic of Cal ...  •  14 days ago
    Actually, foreigners WILL be hit by the tax if they stay in the country beyond 6 months in any particular year. That's the way it works now in France.
  • HL  •  14 days ago
    The same thing is already happening here, people. Obama says he thinks the rich should pay "a little more" in reference to the potential increase in the top rate from 35% to 39.6%. But look at everything he's enacted or wants to enact on upper-income Americans:
    1. Increase the top marginal rate to 39.6%
    2. Eliminate tax benefits for personal exemptions
    3. Phase out itemized deductions
    4. Raise the capital gains rate by 5%
    5. Fully tax dividends
    6. Tax all passive income by an additional 3.8% (enacted under Obamacare)
    7. Increase Medicare taxes (no cap) by .9% (enacted under Obamacare)
    8. Remove the cap on wages subject to 6.2% social security taxes.
    Collectively, this is a massive tax increase and anyone who thinks there won't be negative repercussions, like in France, is foolish or stupid. Look-up "Laffer Curve" if you need more proof...
    • lucho 13 days ago
      Even if the "rich" (250,000/yr give me a break) can afford to pay a little more, we know it is not stopping here. In a couple of years he will be back for a little more (cause he will have squandered the extra income), and will continue on until this country becomes France.
  • The truth  •  14 days ago
    Notice the statement... "people are leaving" (which also equates to jobs are leaving). Nice job at pushing up unemployment while wasting more tax dollars and still pushing deficit up further (never learn - do they).
  • Greg  •  15 days ago
    I guess I dodged a bullet by not buying a Paris mansion last year. I wonder where I shouldn't buy a mansion this year.
    • martinb 14 days ago
      Atlas shrugged is the fiction of a handicapped brain. Just one example.......an oilman goes to a land with no regulation, only problem is, when he gets there there are no customers to sell his oil to, no educated workers to hire, no public roads to distribute his product and no public courts to enforce law and no police to protect his belongings.

      Ayn Rand died poor and on Social Security.
  • Magdala  •  14 days ago
    Like so many articles of this type, they embellish the situation. It so happens that the real estate market in Paris is rising as opposed to the market in most of France where it is just flat. Hence, some owners are taking advantage of a rising market to offer their houses or apartments for sale. Selling property may help avoid Wealth Tax if they ship the money offshore to hidden investment accounts but income of French citizens is taxed worldwide like for US citizens. Hence, they would have to change their citizenship to escape income tax.
 
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