As Brits, we do not really have an equivalent to the American dream but, if we did, it might very well involve getting out of the country rather than making our fortune in it. To an American, the idea of selling the house they own in the US, moving to Canada and investing their capital in a country cottage that is little more than a ruin would probably sound like madness. But, for us weatherworn Brits, the idea of moving to France, converting a ramshackle flint cottage and starting our own gîte business seems to be a popular dream to chase.
 
In the literal sense, 'gîte' means a refuge or shelter but, in reality, they are usually a fair bit more than that. A typical, British-owned gîte is likely to start life as a bargain-priced shell of a building with big potential. It is then developed into holiday accommodation and furnished depending on what type of clientele the owner hopes to attract. A gîte can only be classified as a gîte ruraux (and qualify for a lower taxation rate) if the owner lives in the locality, so a common option is to buy a property that will accommodate the owners and still leave room for a number of additional, self-contained apartments. These apartments are then fully furnished and built to include a number of bedrooms, bathrooms, a living room and a kitchen.
 
Living on site allows the owners to provide any number of services and be on hand to help out their visitors should they need anything. Some gîte owners will welcome their guests with an evening meal on arrival and generally wait hand and foot on their customers, whilst others prefer to live off site, take a more low-key approach and give their visitors a bit more space.
    
The gîte business in France is a competitive one to say the least. The large number of Brits moving out to start up a business in the holiday letting market is one thing but, in addition to this, the French themselves have not failed to recognise the lifestyle benefits of working in the holiday accomodation industry. For every successful gîte business there is another struggling one and the whole of the industry has been littered with casualties over the past few years.
 
Former NHS worker Angie Moore moved out to France in February 2002 after her plans of buying and renting out a holiday home in Charente-Maritime took an unexpected change. "In 2001 my husband John and I decided to buy a house in France. The 'grand plan' was to rent it out and maybe retire there in ten years time. I had worked out that the house would pay for itself in rental income in 11 years. I am not quite sure why we lost patience, but we never made it beyond six months", says Angie. In the end life in the UK became such a grind for Angie and her husband that the lure of their French property proved to be too much. "By February of 2002, after over 100 continuous days of rain in west Cornwall, and with increasing frustration at the latest round of major changes in the NHS, the increase in traffic and pollution and the general state of affairs in the UK, we decided to sell up and move there ourselves nine years ahead of schedule."

Within six months of relocation Angie and John bought an old farm with over a hectare of land, a three-bedroom farmhouse and three traditional stone barns. The idea behind the purchase was to convert the barns into gîtes in an attempt to provide income for the next ten years until they could draw their pensions. "John is an engineer, so we reckoned that we could do all the work ourselves and in that way hope to keep to the timescales, and more importantly the budget for this major renovation project down. Despite a five-month delay waiting for planning approval and difficulties staying within budget, we opened for business with one cottage in June 2005. The second will be completed by Easter 2006 and a third when we find the time and money", says Angie. However, despite her initial achievements Angie warns others who are contemplating following in her footsteps not to expect an easy ride. "After the first few clients came and went, I realised that the only way to earn a reasonable living was to become an estate agent and register and sell houses. I achieved this goal in March 2005 and we are now only just about keeping our heads above water and managing to continue with the renovations. Like most people who work for themselves, we put in more hours now than when we were employed in the UK, but we are spurred on by the fact that we benefit directly from every hour spent mixing, pointing, painting and varnishing."

Anne Wood and her husband Geoff relocated to France in 2004 after considering it as a possibility for some time. On a rainy October morning of that year they set off to the south-west of France after selling their house in Yorkshire. "The main reason for relocating to France has to be that France always had a strange fascination for me because some of my distant relatives were French", says Anne. "We spent a few years researching six of our chosen regions in France, both on the Internet and in reference books, all of which were discarded for one reason or another except for the Poitou-Charentes region. It is very rural and sheltered, somewhat of a microclimate."

Anne and Geoff's plan from the start was to run some sort of holiday accommodation to help with the bills and eventually make a living from. "We were searching for an old property with loads of character and plenty of room to accommodate guests comfortably in a pleasant location with easy access to local amenities.  After viewing many properties, we decided that a charming 18th-century farmhouse was the one for us and promptly put in an offer which, luckily, was accepted." As usual, things didn't go completely to plan. "We were planning all the refurbishment and redecorating being finished and ready to open for business the following March. However after a phone call at the end of November, we had four guests booked in for five nights for bed, breakfast and evening meals. So, panic stations, we had no kitchen only a sink. Fortunately the units, work-tops and tiles had been ordered. We fitted them in four days and, very much like Changing Rooms, were ready just in time to welcome our guests, with whom we spent a wonderful five days.

One of the reasons that Angie, John, Anne and Geoff are likely to make a success of their business' is that they have come to an early realisation of the incredible amount of hard work it takes to avoid being just another casualty of the overflowing gîte marketplace. A long-term plan and some sensible decisions in the early stages of development have made sure that they have got as far as they have. Looking back on their experiences, Angie and Anne believe that there are a large number of things that people need to do to make a success of a gîte. "Geoff and I spent many years soul searching and pondering, during which time the main factors we considered were: how much will it cost us, are we 100 per cent committed and what will we feel about leaving family and friends behind?" says Anne.

These initial stages of the process can be very important. It is at this point that you start thinking about doing something that is likely to change your life forever so it is very important that you do a great deal of research into what you really want from your move. If, in the end, what you want does turn out to be a gîte business then you really have to start thinking about whether or not you can genuinely afford it. "Before you start the ball rolling you need to have carried out an in-depth review of your expected outgoings and your potential income so that you know that you can afford to make the move. Always do a 'worse case scenario' – if you assume full occupancy of your gîtes you will fail", says Angie.

Once the first stage of consideration is complete and all hearts and minds are set on ownership of the world's most successful gîte complex it is then time to drag yourself back down to earth. The next stage of the process is to consider where in France your new life going to be based. According to Angie it is important to remember that "people looking for a holiday in France want good weather, easy access, convenient facilities and that something extra which makes their stay stand out from other trips." Often it is finding the something extra that might make the difference between success and failure. Whether it be that your property is situated near some beautiful natural swimming spots or a vibrant and cultural little French town, this will be important and it is well worth spending a bit of time in the places that you are considering so you can get a feel for what it is like. "In addition to location, your gîte itself will need to have a certain 'je ne sais quoi' in order to make it stand out from all the other gîtes available in the same area", says Angie. "Whatever style you choose for your gîte try and provide the best – be it traditional or ultra modern it will appeal to a certain clientele, but only if it is well done."

According to Angie, when it comes to choosing property you will have a choice of three scenarios – a fully operational gîte complex up and running with all its books in order; a partly converted project with work still to do or a complete renovation project with everything to do. Your budget and financial planning will need to be adjusted according to the scenario that you opt for. The third solution is the most risky as you will have to estimate the
conversion costs and allocate a large contingency for unplanned problems. If you opt for either of the last two options then you will need to consider that you will be starting up your business from scratch and will therefore have to build a client base. "I think if you are planning a move to France and setting up either a gîte complex or a bed and breakfast you should consider that if there is not already a business established you will need to build up your own reputation, which takes time and money. Make sure you have a good marketing strategy in place and that you are ready to work unsociable hours and spend a lot of time cleaning", says Anne.

Angie believes that good advertising is the key to your success. "When you consider the vast number of choices for a self-catering holiday in France, how can you ensure that people find your property? The majority of people find their holidays on the Internet, so you need to have lots of web advertising. You are unlikely to succeed with only one advert. If you consider the cost of placing an ad, it is likely to be less than the cost of one week renting your gîte" she says.

It is also important to remember that once you have attracted the clientele you want to impress them so they come back the following year. There are a number of ways to do this and they all revolve around making the clients feel special. "There is a wide range of extras that clients might appreciate. We offer a welcome pack, which includes a range of local produce. We also have free range eggs available which the children can help collect. The fresh fruit and vegatables out of the garden are also very popular", says Angie. "We offer a number of services to our guests to make them feel at home, such as babysitting, pet sitting, laundry facilities, safe keeping of valuables and the provision of a superb four-course evening meal if it is wanted", adds Anne. However, it is vital to plan and budget for a slow start to your new venture. No matter what services you offer your guests, It will take time and hard work to get things off the ground and up and running so do not expect immediate results. "Many people arrive in France expecting to make a fortune from their gîtes or B&B business but this may not be the case in the first years. You will still have bills to pay and food to buy whether or not you have guests in your gîtes or B&B", says Anne.

It is also wise to make provisions for the unexpected, which can be dangerous if you are unprepared. Like many people setting up a new business Angie's road to gîte ownership was not smooth. "Our property had no access to mains drainage and we had budgeted for the installation of a septic tank, but we did not know that the property was sitting on a ribbon of clay and therefore would need a raised drainage bed – an expensive solution that upset the financial plan and caused more work which set the timescales back as well. If you are buying a conversion project you should ensure that planning permission is likely to be granted, preferably by including a 'clause suspensive' in your compromis de vente.

Overall, there are so many factors that can upset the best made plans so it is literally impossible to have every base covered. However, according to Angie, "the most important factors are to do your market research well. Know your clientele, know the area that you have chosen, consider all the facilities and sights to see in the area and decide whether you think that you could keep a family of four entertained for two weeks. In the current market there are already a lot of gîte complexes advertising similar self-catering holidays. You need to think about how you can be different. You should try to come up with a niche market. The competition is very strong so you need to really think about what will make people choose your gîte."
 
So how did Angie provide that winning formula? "Our solution to most of the above was to choose an area within one day's drive of the channel ports, within 20 minutes of the coast, in a peaceful location, with the second best climate in France. Then we concentrated on providing every convenience that a modern family could possibly require (well furnished and equipped, large swimming pool with great terrace for sunbathing etc) and then we added that extra something. Our theme is organic country holidays – pick your own fruit, feed the hens, ducks and geese, collect the eggs, pet the pig. Also, our clientele is not exclusively English – we welcomed French, Belgian and Irish families as well as English in our first year and we did not have any vacant weeks from June (when we opened) to September", says Angie. Overall, it is important to remember that it is right to be cautious and it is essential to plan but it is important not to let fears get in the way of dreams. The gîte industry is certainly competitive but with the right ideas, research and hard work it is certainly possible to build a very fruitful enterprise.

Legal and Tax Implications
Purchasing property for use as a 'gîte' involves the same considerations and procedure as buying French real estate property generally.  However, there are additional considerations and, if the 'gîte' business is being sold as an element in its own right, further contractual paperwork will be involved. Consider the following when looking for property in which to start up a gite business from scratch. If the property has potential for 'gîtes' but these are still to be created then planning permission will be required, amongst other things, for the conversion of outbuildings into 'gîtes'. This should be covered by a condition precedent in the first contract, usually by way of obtaining outline permission via a 'certificat d'urbanisme'. If possible, an informal chat with the local 'mayor' about the project is almost always helpful.
 
It will also be crucial to deal with matters such as how you will register the business, what insurance you should obtain, whether you obtain affiliation to 'gîtes de France' which leads to certain grants and other benefits, and how you will be taxed. Gîtes, due to their size, do not usually fall into the more stringent regulations covering 'Establishments receiving the public' (ERPs) but if you have a larger project in mind then these should be considered.

How much you pay in tax on your gîte business will depend entirely on how you choose to structure. You need to calculate what you are likely to receive in annual turnover and draw up a business plan that includes estimated costs and expenses. You will very likely need an accountant to help you decide upon the tax regime best suited to you. This regime will depend on the size of your gîte business. With a small business the the MICRO BIC (benefice industrielle et commerciale) is usually the best option. Choosing this option keeps things simple and means that instead of amassing mounds of paperwork, you just declare 30 per cent of your total rental income. With a large business setting up as a commercial company can be beneficial. This option generates all the usual corporate taxes and income taxes but gives you a bit more financial flexibility. You will need to to provide the accountant with an estimate of annual takings, details of projected yearly expenses, and estimate of potential refurbishment costs and an appraisal on the purchase price of the property you intend to buy. Bear in mind that the date your tax is due falls at different times of the year depending on the type of business you are running. Make sure you are aware of the date because you are obligated under French law to file your tax return on time. Be sure to seek good professional advice before any investments.

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Article first published in January 2006