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The recession - how is it affecting gites?


Kitty
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I am interesting in learning how gite owners in France are finding their 2009 bookings so far.  Has the recession had an impact (yet)?  I'm asking because my OH and I are thinking about buying a house with logements and need to project our possible income for a business plan.

I was trying to work out whether the French would be more likely to holiday in France because of the recession?  Are Brits who would usually fly to exotic destinations more likely to come to France?

Your thoughts please...

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The issue of where people will be going and how they will holiday this year, particularly the Brits, is complicated because holidaymakers have different ideas and theories on what to do for the best.

Stirling is down against most currencies not just the Euro so going outside of Euroland won't make matters better. My daughter has recently holidayed in Asia, she goes to Puckett and a couple of the islands about two or three times a year and sterling wise its cost her a lot more than her visits a year ago. She also goes to Dubai once or twice a year on business and thinks that's expensive now as well because of the poor pound.

Somebody on the TV a month or two ago said that people will not forgo their holidays abroad but will look for deals and in particular all inclusive. This makes sense when you consider the cost of accommodation is relatively small for a family of four compared to what they actually spend when they get there on meals, drinks and activities.

Personally I think those within Euroland will holiday within in it. I say this because bookings for our B&B are coming in now and many are from within Euroland. We are having more French bookings than before as they are booking early. It has been my experience over the years that the French normally book later on where as the Brits book early. This has worked well as the quantity of bookings for 2009 made by this time of the year is about the same as the last couple years with the exception that we only have a couple of Brits booked where as normally we would be to well in to double figures by now and the French and other Europeans have made the numbers up.

We have an English couple with a gite about 500M away and they only advertise in the UK and get paid in Sterling. They thought they were being clever doing this but their bookings so far have dried up and they are looking rather worried. I find this a strange way of doing things. They like us spend their money in France and the currency here is Euros therefore why be paid in a currency you can't use unless you convert it. The other thing of course is they are effectively giving the Brits a discount of about 25% if you think about it.

Personally I think it unwise to put all your eggs in one basket i.e. just aim at the UK market. You need to ensure you have a presence on as many European websites as possible and be in as many different European guide books as possible.

We are down in the south of France and in a highly sportive and activity orientated area, different parts of France can experience different trends to us.

The holiday industry is a fickle business and as I always say you never really know until you close the door at the end of the year and count your money.

Good luck with whatever you decide to do.

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[quote user="glacier1"]I'd love to know too, I'm at it converting the house into a gite and I should be open for business by April/May, I'd be interested to know also what people think.  Is going down the road of providing for disabled people a way to ensure bookings?  thanks
[/quote]

Catering for disabled needs a lot of thought. I don't mean that in a nasty way but more in the way of how disabled people will get to you. In northern France I would think that disabled people may well drive or be driven to you. For us that can be a problem as we are a good 12 hours drive from the channel ports. Where we live we may get a few French or Spanish disabled people (we have two rooms suitable for disabled people) but we won't get Brits. The reason for this is because although we are well catered for airport wise they are serviced by budget airlines where traveling as a disabled person can be a problem or so I have heard. They would also have to come with an abled bodied person who could drive them.

What we do cater for is people without children or those that want to holiday in a child free zone. Some have said in the past that this may not be a good idea but our business has consistently grown every year and we now have a good reputation for our child free environment.

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I know of two gites, both running successfully over the past few years.

One is of a higher standard than the other and this difference in facilities is reflected in the rental rates.

Normally bookings start to come in from about now, with the cheaper house filling first and last year, there were a lot of one week bookings.

This year, most of the peak weeks in the dearer house started filling from November and for mostly two weeks at a time. There are no bookings at all for the cheaper house. Even returning guests seem to opt for the dearer, saying things like their city winter breaks have fallen by the wayside so the family holiday is becoming increasingly important.

I think the bookings are mixed between Eurozone and non.

 

 

 

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thank you all for your replies! :) In my opinion, life is like a shot at the roulette wheel, you have to place your bets in different places and you stand to have the best chance of winning.  The same applies with gites, you can't JUST say you are going to do for 1 market, you have to have your gite advertised on european search engines (which is what I am going to do) making sure that key-words are picked up in French, German, Dutch and English.  Somebody said on here that the Scandinavian market is good, my personal experience is when I worked for a big wine store in my local region, I used to have groups of people from Scandinavia.  I was surprised at how many would come down here from Denmark, Norway and Sweden!  Has anybody been able to advertise in those markets?

Myself, I have alocated 1 room and 1 bathroom as "pure" disabled.  I think that this evens my chances of filling up my gite.  The gite is not officially up and running yet, I still have work to be done....but when would you think I should launch the website and take orders? 

I am sure the dark clouds of global economic gloom will pass as soon.  I'm counting on it because we are putting most of our savings in plus selling our car to pay for the work!  Fingers crossed.

David - South of france

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[quote user="glacier1"]thank you all for your replies! :) In my opinion, life is like a shot at the roulette wheel, you have to place your bets in different places and you stand to have the best chance of winning.  The same applies with gites, you can't JUST say you are going to do for 1 market, you have to have your gite advertised on european search engines (which is what I am going to do) making sure that key-words are picked up in French, German, Dutch and English.  Somebody said on here that the Scandinavian market is good, my personal experience is when I worked for a big wine store in my local region, I used to have groups of people from Scandinavia.  I was surprised at how many would come down here from Denmark, Norway and Sweden!  Has anybody been able to advertise in those markets?

Myself, I have alocated 1 room and 1 bathroom as "pure" disabled.  I think that this evens my chances of filling up my gite.  The gite is not officially up and running yet, I still have work to be done....but when would you think I should launch the website and take orders? 

I am sure the dark clouds of global economic gloom will pass as soon.  I'm counting on it because we are putting most of our savings in plus selling our car to pay for the work!  Fingers crossed.

David - South of france
[/quote]

You are dead right in your marketing. You should also look at being with Gite de France of Clevacances or both. They sell their lists to companies in other countries who in turn put them in books. In the UK I believe GDF lists are used for the AA, just as example. We are in books for the UK, France, Germany, Spain and Italy.

Because of the way we purchased our B&B we actually created our website some six months before we moved in which was in January and took our first guests in March

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wow! that's some impressive advance planning if you do not mind me saying.  I will be doing this website next month, the work next month (should be finished by the end of April), the reason for the wait is planning permition, I'm going to start a company to benifit from the health system, and I'm going to "employ" my mother, she'll also be covered.  I can't do anything until I get the planning aproval.  It's a nail biting time for us, but we just have to be patient.  I will talk to gite de france, plus, I will advertise myself.  I want to broadern my scope.  I learnt when I worked in a cave selling wine how much I actually loved meeting people from all walks of life and all parts of the world.  It came easy to me, and it gave me a buzz.  Running a gite in France and working from home should be a realisation of this dream, I shall keep on posting as time passes, it's only through putting our thoughts, mistakes, and just our general observations that we are all able to learn and move forward.  Kind Regards.  David

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This was a long time ago (2000 to be exact) and things might have changed but it took a good three months for the website to gain its ranking from Google and get in to the first four pages on the search engines and yes it was submitted to Google, MSN and Yahoo. For a long time it just never appeared. I suppose that's understandable as I bet they have hundreds and thousands of website submitted every day and it takes forever to crawl the website and rank it. Once that's done you need to tweak it to help get it up in the search engines to a reasonable place. Every time you tweak it you have to wait a few weeks for the change to make a difference.

You should know quite quickly if you can't have planning permission, I think the maximum time the planners have to tell you is six weeks although this might have changed. It will tell you on the back of the form you filled in or which you should have a copy. That is of course unless you have an ancient monument within 1km of you. Building the website gives you something to do while your waiting which is what I did. I would a least think of a name and try and get  the corresponding domain name registered now just in case somebody else nicks it.

Don't forget having Keywords that are foreign means you have to have foreign text in the home page and title (the latter if possible) or else they will be ignored. It will also effect the English version ranking. Having a translator button like the Google one does not count for the ranking with foreign keywords. I found this out the hard way and ended up with two websites, one in French and the other in English which improved matters no end. French advertising websites prefer you to have a separate French website instead of going through an English one to get to the French I discovered,

We get quite a few 'walk in' clients from the books as well as bookings.

Good luck

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[quote user="Cathy"]

[quote user="Quillan"]We get quite a few 'walk in' clients from the books as well as bookings.[/quote]

Thank you, Quillan, for the comprehensive information that you are providing.  It is very helpful.

What does this sentence mean?

[/quote]

People turning up at your door clutching a guide book asking if you have a room for the night. Some people also book their accommodation a couple of days in advance as they tour using a book. Some even just use a book and not the Internet to book their holidays.

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glacier1 - not to discourage you, but please take lots and lots of advice before you 'employ' your mother.  You can't just lay people off in France and you can't keep giving them short term or casual contracts.  If you give her a CDI you may find yourself paying for her plus loads of cotisations (plan on giving the government almost as much as you give her) even if you are earning no money.  Do not go into such a scheme lightly.

I'd also advise people to ask at their local tourism department how things are near them.  Different parts of France are very, well, different.  Quillan is in a part of France which has an excellent all year round clientèle, but many places have a season as short as 8 weeks.  We are in a poorer region and although we've managed to keep going personally OK it is tricky as the little tourist support that there is (restaurants, attractions) keeps closing down and when we get people here there is little for them to do.  We had folk in last week and though they had a pleasant time their comment was that France was terminally 'shut'.  They loved the area and are coming back in April but not everybody would see it that way.

Not being doom and gloom, but your success doesn't always just depend on you.

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In this area (I'm vice president of local tourist office and on commission for tourism) smaller gites seem to be doing better than larger ones with pools etc.  Have spoken to a number of anxious owners who would normally have full summer by now who only have 4-5 weeks booked.  the smaller places, for couples, without swimming pools and cheaper (200 -400€ week) seem to be doing the best.  I think those with families are hedging their bets and waiting to do last minute bookings.  People I know for whom it is a second income are cutting prices on the basis that some income is better than none.  Those for whom it is a primary income seem to be biting their nails.  However there are exceptions and a couple of people are doing very nicely.  There doesn't seem to be much rhyme or reason.  Quite a few second homes which were also rented out for several weeks a year seem to be up for sale.
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In the UK it seems to me that the UK based holiday companies, such as Butlins, are advertising far more than normal so presumably trying to get people to stay in the UK for their holiday.

I suppose though some may take the view 'may as well go abroad before I am made redundant'.

A friend works for one of the major tour companies and she says that they are extremely busy, which would seem to fly in the face of the theory that people will not be going abroad.

Paul

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My OH and I have decided that now is not the time to take on a French mortgage.  So with some reluctance, we have decided, for the time being, not to buy the property with logements. It is on the market for a silly price (an European owner) and so will still be available for sale in the autumn, I suspect, and so we shall continue to read the comments with interest.
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[quote user="Cerise"]In this area (I'm vice president of local tourist office and on commission for tourism) smaller gites seem to be doing better than larger ones with pools etc.  Have spoken to a number of anxious owners who would normally have full summer by now who only have 4-5 weeks booked.  the smaller places, for couples, without swimming pools and cheaper (200 -400€ week) seem to be doing the best.  I think those with families are hedging their bets and waiting to do last minute bookings.  People I know for whom it is a second income are cutting prices on the basis that some income is better than none.  Those for whom it is a primary income seem to be biting their nails.  However there are exceptions and a couple of people are doing very nicely.  There doesn't seem to be much rhyme or reason.  Quite a few second homes which were also rented out for several weeks a year seem to be up for sale.[/quote]

I have always thought that small Gites of one or two bedrooms would do well if marketed properly. The type of people they attract are young couples with no kids or older couples where the kids are grown up. As a couple with no kids (as in ours is grown up) we do not see the benefit of renting a Gite that sleeps 6, 8 or more people. Basically we feel you are paying a lot of money for something you don't use i.e. bedrooms. Likewise a pool is of little or no interest to us. We have always found small Gites difficult to find.

People I know, like our neighbour who has a one bedroom Gites seem to still be doing well. Our neighbour tells us he already has 15 weeks booked. I definitely believe there is a good market for small Gites.

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[quote user="Cathy"]My OH and I have decided that now is not the time to take on a French mortgage.  So with some reluctance, we have decided, for the time being, not to buy the property with logements. It is on the market for a silly price (an European owner) and so will still be available for sale in the autumn, I suspect, and so we shall continue to read the comments with interest.[/quote]

Somebody once told me if you have to get a mortgage to buy a B&B or Gites then you shouldn't do it because there is just not enough money in it. Most B&B's have one person that does the B&B and the other works and helps out in the evenings and weekends, its the only way they can earn enough money to live. I suspect its the same with Gites.

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I agree with the above consensus.

I guess the point of a mortgage to buy a gite is that in the end you have an asset. The gambol is that the value of the property will appreciate, whilst the traffic through the gite will pay the cost of the mortgage. A feasable way to acquire what might become a nest-egg but not a way to earn a living.

We have a 5 bedroom house nearish enough to the coast for bucket and spade holidays and this year are fortunate enough to be booked-up over the summer school holidays. However it is very hard to get bookings at other times.

So the economics mean that we have a 'harvest' season and that makes the house pay for itself.

The economics of having a one or two bedroom gite (in a good location) with bookings through the year means that there might be a reasonable stream of income.

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The reason that we were thinking of a French mortgage was that our cash and assets are in the UK and we didn't think it a good time to transfer them over into euros.  We thought that we could take a mortgage out (we were offered 3.5%) and pay it off when (if?) the pound improves.

 

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I have a big gite and two smaller ones and the money I get from the big house is massive in comparison to the smaller ones, although the letting season may be slightly shorter (25 weeks instead of 40). And big houses are very popular for weekend lets in winter with the French, which can be quite lucrative for very little work.

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Thanks for all your replies, sorry I was away from my computer for a while.  I'm right smack dab in the middle of the rhone wine valley, we have a lot of toursists but only time will tell if it works.  I have looked into employing my mother, it'll cost but it will work in the long run, it's the only way to have health care and my mother does need coverage. 

I have my planning permition authorised as of today, I'm finalising prices for the work to be carried out.  All steam ahead.

I know there are problems in quieter areas, and I anticipate that I will not get full bookings for this summer this year but next year will be better.  I am going to give it a go. 

I wish everybody with gites the best of luck for this season, it's going to be hard but we'll get through it, I can't see too many Brits opting to stay in Britain for holidays rather than coming to France!  I personally would never dream of opting for Britain over France (except for those with financial restraints for want of a better word).  I hope that France will still stay as one of the top countries to visit.  I aim to give guided tours of local areas and various other projects to keep people occupied. 

All I can say is I have more questions than answers, and I am basing all this on a hope of a dream.  I owe it to myself, my mother, and my late father to carry this on, and I hope, through my passion and my commitement to this project that I will succeed.  I know of nothing else.

Good luck to everybody. 

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