How to make an offer on a French property
- Credit: Archant
Property prices in France are often negotiable but it’s not a free-for-all – one wrong move and you could lose out on your dream French home
Headlines advising buyers to offer 30% under the asking price might occasionally be true but generally they’re wide of the mark. Most deals are agreed much closer to the advertised price. You can’t apply a formula to the individual circumstances of any property that tugs your heartstrings – you wouldn’t do it at home, and you can’t do it in France. It’s something of an urban myth.
When selecting properties to view, by all means add a margin to your budget, and be prepared to spend what you need to in order to get the ‘right’ property at a fair price. But if you’ve heard that every house sale in France is a fire sale, you’ve been given bad advice.
What’s it worth?
Good question. Even as property professionals, with years of experience, it is difficult to draw comparisons between unique rural properties. As a buyer you will rapidly develop an instinct, and will of course be influenced by what you like most.
A sensible valuation will be influenced by many factors including geography, local environment, condition and potential, not to mention all those subjective factors such as a ‘magnificent’ view. It’s not a price per square metre.
You might reasonably ask whether the property was valued by a professional, or is it what the vendor needs to achieve in order to satisfy the bank? Of course, all the prices you see advertised have one thing in common: so far, no-one has agreed to pay that price.
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Do your homework
Let’s assume you like the property. What do you know about the situation of the vendor? We are asked two questions almost as standard: “How long has it been on the market” and “Why are they selling?”.
Agents have a duty of care to all parties and issues of privacy come in to play here. A property may have been on the market for two years at one price and two days at the current price. Reframe your question so that it is received as a buying signal rather than idle curiosity. Why someone is selling may be deeply personal, do you really need to know? Perhaps the question that gets to the heart of the matter should be: “Are they negotiable on price/contents/timing”?
Show your hand
You’ve found ‘the one’. Butterflies! You nudge the other half. Do you now kick the wheels and find fault with something you fundamentally like in an attempt to reduce the price?
The price of goodwill is hard to calculate yet expensive to ignore. Remember that even if the vendor is leaving the country forever, their friends and neighbours are probably not. You have a four-month process to navigate from agreed deal to keys in hand; after that you will be rubbing shoulders with people in this same small community. Will these be your first steps towards integration or isolation?
How will you fund the purchase? No one need be offended by being asked the question. Consider your own position as a seller. You would want to know the detail of any offer, right?
Cash is not necessarily king. Sometimes a mortgage is a smart fiscal move; it need not be a disadvantage. As an agent – and speaking on behalf of many vendors – I would rather deal with a buyer who tells me they need a mortgage and can demonstrate some likelihood of achieving one, than someone who says they have cash simply to gain agreement, only to turn out to need a loan when it comes time to sign on the dotted line. Yes, real ‘cash’ will help your position, but decent agents and vendors are not wedded to ‘cash only’.
Are you a negotiator?
If you’ve found a property privately, you will probably be on your own from now until you get the keys. Maybe the bloke in the bar will end up being your main advisor. Or can you trust an estate agent? Might the fee represent good value from here on in? What price assessing the vendor’s valuation and navigating the legal system?
If you have found an agent you like and trust, ask them about their experience in negotiation. A decent but inexperienced agent will take advice from a senior colleague. A good negotiator will not tell you what to offer, but will guide you respectfully to negotiate a fair and equitable deal.
Pitch your offer
A clumsy first offer may be the last chance to buy the home of your dreams. Maybe the bloke in the bar said you should make a low offer to start the ball rolling. Then again, maybe the old French owner will be so offended they won’t listen to your second bid.
Or you may find your ‘first’ offer is used by the vendor to stir up interest from other parties. All you have done is confirmed their reluctant instinct that they might need to move on the price.
So timing is critical. If you’re lucky, you might view the property at the very moment when the vendors realise they need to accept a lower price. Timing is also about the speed with which you act having found a property of interest to you.
Coup de coeur?
Of course, you may find the home of your dreams at a price just out of reach, in which case you are probably well advised to say so. Your honesty may be well received by both the agent and vendor.
Playing hardball with a property you have an emotional attachment to may not be a smart negotiation. In an attempt to save, say, €2,000 on a property you plan to enjoy for 10 years, you risk losing the deal – for €200 a year or €4 a week.
Seal the deal
Fast-forward, and a happy outcome has been negotiated for all parties. Be clear now, not later, about your timescales and expectations. It’s tiresome to be arguing about fridges and strimmers when we are all meant to be focused on the property.
Beware ego. This need not be about ‘winning’. A good deal is first and foremost about getting the right property and only secondly about the price. Whether you are a buyer or a seller, may you live happily ever after.