Opening and running a gite in France

Index:

Setting up, opening and running gites in France :

In the past twenty years or so, thousands of people from Britain, the Netherlands, and many other countries - even Australia or the USA - have taken the plunge, and moved to France - for retirement, early retirement or to find a slower pace of life in a rural area. And for many, either before coming, or once arrived, the idea of earning a little money on the side - or even earning a living income - through the opening of holiday accommodation, has seemed an exciting or interesting challenge to be taken up.
Some have been successful, others less so; and for some, the whole venture has quickly turned to disaster. As with most projects - specially those where a certain amount of serious investment is required, opening and running a gite or a group of gites calls in varying degrees for resources, a certain vision, an ability to work with local contractors, a fair degree of self-sufficiency, and plenty of determination to make things work.

Buying a gite

For the person thinking of moving to France, there are two ways to acquire a gite or potential gite; one is to acquire a rural property that is big enough to divide into more than one unit of accommodation - and run a gite that is essentially an extension of the owner's own accommodaiton. The other is to acquire a group of cottages or houses that can be used as multiple gites - the owner living in one of the units, or close by. And in either case, there is the possibility of buying an already-operating gites business, or starting from scratch.
How many gites?
Obviously the more units that are acquired or envisaged, the greater the potential rewards when the project finally comes to fruition, but the greater the investment. Establishing a small group of gites has the advantage or reducing the renovation costs per unit, notably by spreading the cost of such features as a swimming pool or other facilities over more than one gite. The downside is that the gites may not have the independence and privacy that many people are looking for when they decide on a gite holiday. But there is another big downside to running multiple gites – one that is often totally overlooked when people are drawing up their plans – and that is "changeovers", the time required for cleaning and preparing for the next visitors. Generally speaking, gite changeover day is Saturday; and while it is not too hard for gite-owners to clean, tidy and reorganise one or two gites between time-out and time-in on a summer Saturday, any more may require the hiring of domestic help or lead to serious logistical problems.

Renovating and equipping a property as a gite

This can be done on the cheap; but it's not the best way to create a gite or gites that bring in the visitors - unless the rental prices are very cheap too. Gites come in all shapes and sizes, from the small and rudimentary (less common these days) to the utterly luxurious; but by far the majoirty lie in the middle – rural accommodation that is able to match the expectations of holidaymakers.
Most visitors are looking for a certain degree of comfort, even luxury – which means that gites are best renovated and equipped with a certain degree of good quality. Besides, quality equipment and furniture tend to be more robust than the cheaper stuff, and so will last longer and wear better. It means more investment upfront, but normally better value for the owner in the long run. It is vital not to underestimate the cost of renovating even a "liveable" rural property as a gite, and equipping it to the standard that visitors are going to expect for the price you ask.

Profitability

Running a gite / gites as a profitable venture is not easy, if the intention is to ensure a healthy return on the capital investment – unless the gite is in the league of exclusive luxury properties. On the other hand, if the capital investment can be largely disregarded – which is something that individuals can do, but not companies - then running a gite or gites as a means of ensuring a certain income is less of a challenge.

Doing-it-yourself

There are plenty of enterprising gite-owners in France who have done a lot of the renovation work themselves; but renovating a gite can require a good range of skills, not to mention a lot of time, and the complexity and scope of the task should not be underestimated. Any major work will almost certainly need to done by professionals, and their services may be essential when it comes to making sure that renovation work complies with today's building standards, and safety standards, notably with regard to electric installations, swimming pools, ventilation, and so on.
The situation is far less complicated for properties that are already in basic working order, but need a superficial makeover to render them clean and attractive for potential guests.

How long can you rent your gite for?

This will depend largely on five factors:

Where the gite is located,
How much you charge relative to the local going rate (value for money),
Whether you have any special selling points (like a spectacular view or location),
How much you are prepared to spend on advertising,
and once established, How many return visitors you can acquire.

There are thousands of gites in France whose owners will be more than happy if they can rent their property for more than eight or nine weeks in the year. Outside of cities, skiing areas and the French Riviera, the holiday season lasts for two months, plus a couple of shorter less active periods at Christmas and Easter. For the rest of the year, there are a lot of gites chasing a relatively small number of holidaymakers. The more of the above five points on which a gite scores well, the more bookings it is liable to get, over a longer season.
Though a word of caution: equipping gites for hire in the winter months may well not be worth the effort. There is a point for most gites at which the extra revenue gathered from off-season visitors will be minimal - if not negative - compared to the cost of catering for these visitors.

Advertising

Heavy advertising can (but will not necessarily) produce a considerable extension of the letting season, but the profits on low-season rentals cannot be high, given the unfavourable balance between supply and demand.
Listing with "Gites de France" or "Clévacances" is not an obligation, and there are very many gites that are not listed. On the other hand, it will normally ensure good occupancy in the main holiday season, plus a quality label that can be used in promotion: but both come at a cost, for inspection and listing, as well as a sizeable commission (in the range of 15% - 20%) on sales. And it should not be forgotten that a 20% commission on sales is 20% of revenue, not 20% of profit margin; in terms of percentage of actual profit, the figure is considerably greater .
The most cost effective way of advertising gites is almost certainly the Internet. There are hundreds of gites directories to choose from, but among them probably no more than a dozen that can guarantee results. Prices vary considerably, with some directories charging over 300 € a year.
There are essentially three types of sites for advertising gites on the Internet.
a) The commercial sites that charge in the region of 300 € a year with no guarantee of performance. Many of these now belong to a large Texas-based company called Home Away, who now own - among others - Owners direct, Holiday-Rentals co. uk, Abritel, Homelidays, TopRural, Bedandbreakfast .com and a dozen more online directories - and whose first objective is obviously to make as much money as possible for their shareholders and directors by signing up as many advertisers as possible. Given their business model and their high advertising rates, these directories must produce some results for some advertisers - but feedback suggests that their results are extremely variable, and not necessarily any better than smaller directories.
b) Free online directories. These are almost always a total waste of time, though there are some, particularly regional sites, that generate a few clickthroughs.
c) Between the two, a small intermediate category of independent directories, including Gitelink.com ; these sites make a small charge and depend, for their continuing survival, on producing results.

Conventional wisdom suggests that owners should list their properties with at least three or four productive directories, as no directory on its own can guarantee maximum results........ unless your gite/s have a remarkable selling point in their own right. In which case, they should advertise themselves by word of mouth alone. On one expat-targeted French property information site, there is an article suggesting that owners should reckon on spending 1500 € a year on advertising. This is quite way over the top ... or possibly an unintended admission of the lack of effectiveness of some of the more expensive gites advertising sites. A listing with Gitelink can cost as little as £26 a year, and is guaranteed to produce results, given the very favourable ratio of visitors to sites listed; but listing with just a single directory is very unlikely to produce enough customers to fill a gite for a whole season.

To conclude
Buying, renovating and running a gite or gites can be fun, can be a source of income, and an occupation; but neither the economics nor the risks of the operation should be underestimated. Finally, it is important to remember that running a gite / gites is a job, and in particular one that will keep the owners busiest in the summer holiday period.

Gite or B&B owners:

Advertise your gite on Gitelink France: rates start at £25 or 30 € for 2012
Gitelink is a successful online directory for the promotion of independent gites, country cottages, holiday villas or b&b accommodation in France.
See our announcers page for further information.