Estate agents in France
The simplest way to find a property to buy is via estate agents as you many French properties don’t have ’for sale’ signs outside.
One of the main reasons for this is that a seller can put his property for sale with as many estate agents as he wishes. An agent may try to persuade the owner to let him sell the property ’en exclusivité’ but on the whole the race is on amongst several agencies to sell the property first!
Do not allow yourself to be ’bullied’ by your agent. Remember that the first one to make the sale gets the commission. This means that they will often push you to make a quick decision before the property is seen and sold by another agent.
Some are more pushy than others!
Agencies usually charge in between 4 and 10% on top of the seller’s asking price (it is the buyer who pays the agency commission, not the seller). Check that the prices you are being quoted already include the agent’s fee.
Procedure for buying a property in France
The procedure for buying property depends to a certain extent on the type/size of the property being purchased and your own personal situation but the following explanation will give you some idea of the order of events. (Newer properties actually have lower charges as both solicitor’s fees and stamp duty are reduced)
Once you have found a suitable property and had your offer accepted, you will sign a sous seing privé (if it has been drawn up by an agent) a compromis de vente (if the agreement has been drawn up by a notaire. This states the details of the agreement, price, date limits and any finance to be obtained from a third party. You will also receive some reports on the state of the property which are legally required to be provided to you, normally when you sign the compromis. This is a full list of these diagnostiques obligatoires (legally required test reports)
You will need to take with you your passport, marriage certificate (where applicable).
Choosing a notaire
The seller will already have chosen a notaire who will draw up the compromis de vente and carry out all of the necessary processes that lead to a sale. You can just go along with the choice as the buyer pays the notaire’s fees and the state taxes and in theory the notaire, although instructed by the seller is working for you, or is at least neutral. However if you prefer to have someone definitely working on your behalf, you can instruct your own notaire to work in tandem with the one instructed by the seller.
The Deposit and Cooling off Period
You will be required to pay a deposit of up to 10% either to the agent or directly to a notaire. This money will be placed into a closed account until the exchange of contracts. Only authorised agencies may carry out the signing and accept deposits; these tend to be the larger national agencies. French law then stipulates that you are entitled to a delai de rétraction – a 10 day “cooling off” period during which time you can change your mind about the sale without incurring any expense (If the agent or ’notaire’ has already asked you for a deposit, that will be refunded in full within 21 days maximum). If you no longer want the property, you must send the vendor a registered letter stating your intention within the 10 day period. The seller on the other hand is now under obligation to sell you the property and would be legally bound to pay you 10% of the asking price if he were to renege. Once the seven day ’cooling off’ period is over the contract is binding on both sides. However, if the sale is dependant on a mortgage offer, a further period of time is available to secure the finance, if this has been stipulated in the Compromis de Vente under “Conditions suspensives”. If the finance is not granted, the buyer may pull out without any penalty. Bear in mind that banks may require additional guarantees to finance foreign nationals whose income comes from abroad.
The job of the ’notaire’
The solicitor should now check out rights of way, ownership, termite infestation etc. However actual building surveys are not required by finance companies nor carried out routinely in France, so if you wish for a survey, you will need to arrange this privately.
By the completion date, all monies should be transferred to the solicitor. It is advisable to do this a few days before the agreed date in case of bank delays etc. At this point you will sign the Acte authentique de vente (in person if possible but if not you may appoint a third party to act for you) ET VOILA! – the property belongs to you! Procedures do differ depending on the size of the estate agency, the area, the type of property, the ’notaire’ etc.
Checklist of documents you should take with you when house-hunting to be on the safe side!
Marriage/Civil Union certificate
Proof of finance (bank/building society statement, proof of loan application)
Checklist of documents you should take with you if you intend to apply for a loan/mortgage with a French bank
If you wish to get the ball rolling immediately:
Marriage licence/Civil Union certificate/Proof of divorce
Proof of income (last 3 pay slips/P60/last 3 bank statements)
RIB (relevé d’identité bancaire) This is quite simply your bank details, account number etc
Details of any ongoing mortgage/loan
Compromis de vente/sous seing
Information that you should try to obtain from the vendor before committing yourself
Any planning permission pending
Location of drains and sewerage
The heating and air conditioning system
Gas and electricity supplies
Swimming pool conformity regulations
If the property is less than 10 years old there should be a construction insurance called an assurance dommages-ouvrages et assurance responsibilité décennale This means that the builder guarantees the construction under article 1792 to 1792.6 and 2270 of the civil code.
Here’s a useful website to help you to calculate the ‘frais de notaire’ or solicitor’s fees.
All you need to do is type in the following information.
♦ property type (old, new, plot of land…..)
♦ department where property is located
♦ purchase price
♦ loan with or without mortgage.
The calculations fit most situations and also help you to better understand (and therefore feel less hostile towards the notaire) the distribution of costs, clarifying sums which are collected on behalf of the state, and the actual payment to the solicitor. SInce May 2016 there has been a reduction in notaire’s fees in certain circumstances which you can read about in our article “Reduction in French Notaire Fees“.
Estate agent’s fees
Make sure that these are included in the price quoted to you but listed separately from the house price on the Compromis de vente and the Acte de vente, so that you don’t end up paying notaire’s fees on them.
They can be anything up to 10% of the sale price. They are normally negotiated by the seller but in theory payable by the buyer, although almost always included in the quoted price. They are negotiable, if the agent wants the sale badly enough.
Taxes payable on property purchase
Land Tax or Property Tax (taxe foncière)
This is an annual charge payable to the council and is due and payable yearly between September and November. There is a two year exemption for newly built properties
Dwelling Tax (Taxe d’habitation)
This is payable to the council by the person or persons LIVING in the property on January 1st of each year. If the house is rented, this tax is the responibility of the tenant.
Income Tax (impot sur le revenu)
Any person not resident in France but receiving rental from property (even if the rent is paid in the country of residence) is liable to French income tax. A tax allowance of up to 15000 per year is available.
Capital Gains Tax (plus-value)
Payable on resale on properties that are not your principal residence. This is calculated on the basis of the difference between the sale price and the purchase price (after various additions and subtractions!) It is set at 16% for residents of the EEC.
This depends on the link between the beneficiary and the deceased and it is well worth looking into as French inheritance laws are quite complicated. For example, you cannot disinherit someone who is entitled to your property, even if you don’t want them to have it! (New laws mean that you can now make your will according to your country of origin.)
Where to buy
Where you buy your house is really the most important part of the decision. A house can be changed, renovated, extended or modernised but you can’t change your location.
The Pyrénées-Orientales has so many possibilities that you are able to choose beach, mountain or plain, all within the region.
If you wish to buy your property in a quiet and unspoilt part of the region, do be sure that you have access to all services and that you are able to return to ’civilisation’ if neccesary in times of snow or high winds.
If you are buying through an agent, remember that ’10km from shops’ might mean 10 km of steep, narrow, winding mountain road.
If you have a young family, schools and public transport have to play an important part in your decision. Take a look at a couple of sites which will tell you a little about schools in the region: www.cartables.net (in French) and www.education.fr – an excellent site which will give you all the info you need for choosing a school in France, some parts in English, others in French.
See this article for one reader’s take on what to look for when deciding on the location of your new house.
Check out the talking from experience page where people give tips on buying a house in France.
For more information in French on the process see www.notaire.fr.
And finally this is a light-hearted view of the nightmare that buying in France can turn into if you haven’t done your homework.