New to the French property market?
Our comprehensive guide will help you ﬁnd your bearings…
The process of buying property in France is actually pretty straightforward and well-regulated. Every year, many thousands of overseas buyers purchase new homes in France without problems or complications.
The most important issue to bear in mind is that the sale becomes binding much earlier in the process than in the UK. Therefore, if you allow enough time during your viewing trip, you can effectively secure a property you’ve just seen and return to the UK knowing that no-one else can buy it – gazumping is rare.
Properties for Sale
French properties are sold in a variety of ways: privately, via notaires (public notaries) or agents immobiliers (estate/property agents). The majority of overseas buyers in France use property agents as this is a more familiar process and you’re more likely to encounter someone who speaks English.
Make sure your property agent belongs to a registered body, such as the Fédération Nationale de l’Immobilier (FNAIM), Syndicat National des Professionnels de l’Immobilier (SNPI) or Union Nationale de la Propriété Immobilière (UNPI). This information should be visible somewhere in an agent’s office – which you should always visit, to check out their set-up, before using them.
An agent immobilier will often ask you to sign a bon de visite, which confirms to the vendor that they, the agent, are the ones who showed you a particular property. This prevents conflicts between agents!
The prices displayed in a French property agent’s window or on the internet should include the agent’s fees, which are anywhere between 4% and 10% of the property price. If this is the case, the price should be followed by the letters FAI or Frais d’Agence Inclus. However, the price shown doesn’t usually include the notary fee.
When you’re considering a property, always ask what the price quoted includes. Ask for an estimate of any additional fees and don’t forget to add 20% for the French version of VAT, which is TVA (Taxe sur la Valeur Ajoutée), to any extra fees.
Making an Offer
Don’t be afraid to make an offer on a property, just as in the UK. If you can find out how long the property’s been for sale or the vendor’s situation, you may get an idea of whether they’d accept less than the asking price. You can, of course, discuss this with the agent.
“The property agent should be able to recommend a notaire but you’re entitled to appoint your own”
Property surveys, in the UK sense, aren’t usually undertaken in France, because the profession of surveyor doesn’t exist in the same way. If you’re concerned about certain aspects of the structure of a property or renovation issues, you could contact one of the growing number of English-speaking surveyors working in France. Alternatively, arrange to visit the property with a local builder to get their opinion and a costing. It’s better to get a property checked out before you agree a price and sign any contract, especially if you anticipate doing a lot of renovation. If you need a survey, but don’t have time to carry it out before you sign the contract, ask the notary to include a clause suspensive in the Compromis de Vente, to ensure that your purchase is subject to a satisfactory survey. Before you sign anything, make sure that you see the plans of the property and its land. Ask the agent or at the local mairie to see the ‘cadastral plans’, to check there aren’t any private or communal schemes to build new properties, offices or farm buildings close by.
Once you find a property and agree a price, the contract process will be handled by a notaire – the only person permitted by law to perform conveyancing in France. The notaire charges a fee, usually between 2% and 8% of the ‘net’ property price. Note that, the lower the property price, the higher the notaire’s percentage charge will be. The notaire’s fee may be included in the price if you buy via an agent but do double-check! The notaire is required by law to act impartially, and acts for both buyer and seller. This may seem strange to UK buyers but the vast majority of transactions in France are handled this way, by a single notaire. The property agent should be able to recommend a local notaire but if you feel unsure about this, you’re entitled to appoint your own. The latter option won’t cost you any more money, as the two notaries will split the fee between them, but it can be a less efficient way of handling the purchase. You can also pay for additional independent legal advice in France or the UK.
Although you may find a notaire who speaks some English, it’s important to realise that the legal documents will be in French and often contain unfamiliar legal terms. Some property agents offer translations of the Compromis de Vente but this isn’t their primary role or responsibility. If you’re uncertain about any aspects of the contract, obtain a professional translation, either in France or the UK.
“Buying to let or as a business investment? Remember to get advice on tax early to avoid any surprises later on.”
– Christian Faulkner, Property Services Assistant, FrenchEntrée
The First Contract
The Compromis de Vente is usually the first key document you’ll sign and it sets out the main terms of the agreement between the buyer and the seller. Normally, the buyer will pay a 10% deposit upon signing, which is held by the notaire. The Compromis has to be signed by both parties and is legally binding – the only ‘get out’ is if one of the clauses suspensives (see below) isn’t met.
The Compromis will include a date when you’re expected to sign the Acte Authentique. This date isn’t legally binding and is really used as a target date which both parties can aim for.
For the notaire to draw up the Compromis, you’ll need your passport, marriage and/ or divorce papers, and if you’re borrowing money, the paperwork for the loan/mortgage.
These conditional clauses can be added to the Compromis de Vente by the notaire and allow you to withdraw from the purchase under certain circumstances; so it’s important to give them some thought. You can add any clauses you like to the Compromis, as long as the vendor is willing to accept them.
If you’re obtaining a mortgage, the notaire will automatically include this as a conditional clause in the contract so if your provider turns you down or refuses to lend on the property you won’t be obliged to go ahead with the purchase. Other typical clauses include ensuring that you’re able to obtain planning permission or certain works/ repairs are carried out. You need to discuss these clauses very carefully with your agent and the notaire at the time of making the offer. Many problematic purchases or disputes could have been avoided if the purchasers had introduced clauses to protect themselves at this stage.
“Every year, thousands of overseas buyers purchase new homes in France without problems or complications…”
Lead, Asbestos, Termites & Energy Reports
These reports are all required by law and grouped together in a single document known as the DTT (Dossier de Diagnostic Technique). It’s the vendor who’s obliged to commission and pay for these up-to-date reports to be attached to the Compromis de Vente – the notaire will ensure that the law is complied with. Termite reports are dependent on the area of France and vendors with swimming pools are obliged to commission a report on its safety features.
Once you’ve both signed the Compromis, the buyer has a ten-day cooling-off period. During this time, you can withdraw from the sale without incurring a penalty, but the seller cannot. Once this period’s over, the contract’s binding for both parties. Therefore, it’s crucial that you don’t sign the Compromis lightly!
Transfer of Funds
The deposit is usually 10% of the net purchase price. From this point on, if you withdraw from the sale, you could lose your deposit, unless it’s for one of the reasons listed in your clauses suspensives.
Local Authority Property Searches
Once the Compromis is signed, the notaire will begin the legal process, including the searches on the property, such as the land registry, rights to ownership, boundaries and rights of way. It’s important to note that, in France, these searches don’t include looking at any private planning permissions that may exist near the property. So to ensure your neighbour isn’t about to build next to your boundary, visit the local mairie and ask to see the plan communal (recent planning applications) or ask the agent to obtain this information.
“If you like it, make an offer! You have nothing to lose and this will start a dialogue to discuss further negotiation if needed.”
– Christian Faulkner, Property Services Assistant, FrenchEntrée
How Long Does It Take?
The whole buying process should take three or four months, from making the offer to signing the final contract.
The Final Signing
At some point, your agent or the notaire will advise you of the proposed date to sign the full contract – the Acte Authentique or Acte de Vente. You should be present for the signing of the completion document, if at all possible. If you aren’t able to attend, you can arrange a power of attorney.
Arrange to view the property you’re buying on the day of the actual signing. This is because the final contract has a clause saying ‘sold as seen on signing date’, so you need to know that the property is exactly as you expect it to be, and not with floors, walls or windows missing!
You need to plan ahead in order to transfer the balance of your payment to the notaire’s account in plenty of time for the signing date. The house won’t become yours until all of the money required (including the mortgage funds) for the house purchase, and all of the associated fees, have been sent to the notaire’s bank account.
Once you have signed the final contract, you can retire to the nearest bar and enjoy a celebratory glass of champagne!
Disclaimer: This guide is provided for general information purposes only and isn’t intended to be a substitute for professional advice regarding any aspect of purchasing a French property. If in doubt, consult your estate agent, legal or tax adviser. FrenchEntrée cannot be held responsible for the consequences of decisions or actions you may choose to take in connection with viewing trips or a property purchase.
Orginally published in issue 120 of FrenchEntrée magazine.