This is a scheme whereby you purchase a second-home or an investment property and use it for a commercial lease. It was originated by the French government in the late 1980s as a way of encouraging people to buy property in holiday hotspots, boosting both the property market and the tourist industry.
When you buy a leaseback property, you lease it to a management company, which then rents it out on your behalf. You receive guaranteed rental income, with annual rates ranging usually from 3-6%. The lease is usually effective for a minimum of 9-11 years and it is often renewable.
A huge additional incentive is that the French government refunds the VAT on the purchase on a pro-rata basis. Effectively you will receive the full 19.6% tax back for a new property. On top of this there are other tax benefits, including no capital gains tax if the property is held for 15 years and they can also be bought with SIPPs.