12 things you should know about buying a French property
PUBLISHED: 13:11 16 March 2015 | UPDATED: 12:12 13 October 2015
Looking at French property for sale? Make sure you read this quick guide full of key facts first, whether it’s a French château, French farmhouse or small apartment you are searching for.
French estate agents must hold a carte professionnelle, which you can ask to see. They tend to give out less information about a property than their UK counterparts – for example they’re unlikely to tell you a property’s address – and usually accompany you on viewings.
2. Initial contracts
Once an offer has been accepted both buyer and seller sign a sales contract, usually the compromis de vente, a legally binding contract stating the names and addresses of buyer and seller, the address of the property for sale, the agreed price and so on.
Conditional clauses (clauses suspensives) can also be included. (Other initial contracts include the promesse d’achat, i.e. promise to sell or buy, but they don’t bind both parties to the transaction.)
A 10-day period then follows, during which time the buyer can pull out for any reason without penalty or losing their deposit.
A deposit is paid (usually 10%), which is forfeited if the buyer pulls out after the cooling-off period. The deposit can be paid to the notaire or into the agent’s escrow account (never directly to the vendor).
The conveyancing process usually takes around three months and is carried out by a notaire. It is followed by the signing (by buyer and seller) of the acte de vente (deed of sale, usually in the notaire’s office. If the buyer can’t attend, they can appoint power of attorney to someone else to sign on their behalf. Ideally you should view the property on the day of completion as it is sold as seen.
The balance of payment is made to the notaire at completion, as well as agency and notaire’s fees. The notaire gives the new owner an attestation de vente (final ownership papers are posted six months later).
Buying fees in France are high compared to the UK (agency and notaire’s fees usually amount to around 10-15% of the sale price; less for new-build). Agency fees are normally paid by the purchaser. In adverts, Frais inclus means fees are included, net vendeur means they’re not. Agents set their own rates, generally between 5 and 10%.
In France a notaire must be used when a property or land is sold. Buyer and seller can share a notaire or appoint one each (in which case the notaires share the fees). Notaire’s fees are on a sliding scale of 6-8% (depending on the property’s value).
In many ways a notaire is like a British lawyer, but they are employed by the French government to ensure a sale is above board and that all taxes are paid. It may be advisable to seek additional legal advice from a lawyer specialised in both UK and French law.
If you need finance to purchase your French property, it’s best to get a mortgage agreed in principle before you start viewing. Mortgage brokers experienced in overseas sales can advise you. If you need a mortgage, this will be a condition of the compromis de vente; if you fail to obtain one, the contract is void with no penalty to you. Once a mortgage offer is confirmed, the notaire is informed and the sales contract becomes binding. Read more about mortgages here
You can shop around for currency deals, just as you can for mortgages. You may want to consider a ‘forward contract’ whereby you purchase currency at a set rate.
You should insure your property as soon as you become the owner. You can simply take over the previous owner’s insurance, but it might be best to take out insurance tailored to your own needs if, for example, a property is a holiday home and left unoccupied for periods of time.
Surveys are not commonplace in France. However you can arrange one with a British surveyor working across the Channel or a builder or architect. You’ll need to organise this before the initial contract becomes binding, or you might be able to insert a conditional clause stating that the sale is dependant on a successful survey. Vendors are required to provide a series of diagnostiques or reports on lead, asbestos, flood zones, termites, natural risk and gas. Obligatory for all house sales since 2011, the DPR report shows the energy efficiency of the property.
11. Buying off-plan
When you buy a new property in France, you sign a contrat de reservation at the outset, and then make stage payments. Buying costs are lower; the deposit is 5% and notaire’s fees are around 3% plus there is a two-year exemption from taxe foncière. You can check these taxes with the agent when you view properties.
This is one area where many buyers seek legal advice prior to buying a French property, as France has a forced succession system, unlike the UK. This means you cannot leave your property to whoever you wish, and you cannot disinherit your children, whether legitimate or not, from a current or previous marriage. There are various ways of managing this system, such as using a tontine clause, the communauté universelle marriage agreement or buying via a property-holding company (SCI/société civile immobilère), all of which require legal advice.