Hello there.
If you buy a new build property in France BEFORE it's complete, you don't have to pay back the VAT on it. So, if you'd left the roof off your gites, you'd have no problem with the VAT man !!! Even if you started building them 20 years ago and they'd been sold on every year since, nobody would have paid VAT on them. The problem arises once they're "finished" which is why you see so many "unfinished" buildings for sale in France.
As soon as the mairie deems a building to be "habitable" your 5 year countdown begins (this applies also to new builds from major promoters- your 5 years may well begin on a different date to the date you receive your keys on the "date de livraison").
Should you sell your property within this 5 years then you will have to pay back you VAT to the government, minus the "abattements" you will get for any deductible work you've carried out. In general, you're better waiting for the 5 years to have run its course (you can put a suspensive clause in your compromis to make hte date of the ACte de vente later if your 5 years is nearly up by the way). Otherwise you are better speaking to your notaire to see exactly how much TVA you'll have to pay back and what the value put upon the Gites will be so you can really work out if it'll be worth it for you.
Best of luck with it
Claire Healy
Property in Nice & Property in Cannes