Charlotte Macdonald is an associate solicitor in Stone King’s international and cross border team.
Over a new 12-part series of articles Charlotte answers legal and practical questions that are often asked by her clients in relation to France; whether that be buying or selling property in France, inheritance law, or how inheritance and capital gains tax are treated between the UK and France.
Stone King offers a service to assist individuals when they buy property in France, and here are some frequently asked questions:
What questions should I ask at the first viewing of a French property?
It is impossible to provide a list of all the questions to ask, because each buyer and each property is different. The questions you will need to ask when viewing a new-build apartment in Paris will differ from those needed for buying an old farmhouse in rural France!
But, as a starting point, we have put together a list of 5 questions which should be asked:
Does the advertised price include the estate agent’s commission?
Check to see whether the honoraires are paid by the buyer, the seller or shared between the parties. It should be noted that if the buyer is asked to pay the commission, the notaire’s fees are generally reduced.
How much are the notaire’s fees?
The frais de notaire (notaire’s fees) are actually a combination of taxes, expenses and the notaire’s fee.
What are the rights of way over the land?
In rural France, a neighbouring farmer may have acquired servitude (rights of way) over the land. These rights can often become problematic in the future. You should ask the seller about these, and your notaire will also be able to research these for you.
Are there any restrictions on planning permissions?
If you are buying a project to fully renovate, or simply want to make a few changes you should ask about planning. If the property is built on agricultural land, or near a protected building, or within a conservation area, it may be subject to strict planning restrictions. This could prevent you from renovating your property or building an extension – it is better to find out about any restrictions before buying!
What tax is payable for the property?
The taxe d’habitation (which is similar to council tax) is paid by the occupant of the property on 1 January – an important consideration for transactions due to complete at the end of the year. The seller benefits from a December completion, whereas the buyer will prefer January.
The taxe foncière (land tax) is paid by the owner of the property also on 1 January. However, this tax tends to be split pro-rata between the parties.
Don’t forget to ask your notaire about any available exemptions or reliefs.
In addition to the taxes above, if your property is valued at over €1.3 million you will need to consider impȏt sur la fortune immobilière (IFI). This is a type of wealth tax and applies to your worldwide assets if you are French resident or just your French property if you are non-resident.
Where can I find more information about French property taxes?
You will be able to get an idea of the local property taxes using the government directory website: Service-Public. You can search by tax type, and/or location. However please be aware that the website is in French, so if your French is at beginner level you may need to ask a French-speaker to assist.
What kind of insurance is required when buying property in France?
The type of insurance cover will vary depending on what your property is to be used for and the level of protection that you want.
- Buildings insurance – covers your building against risks such as fire or floods.
- Public liability insurance – third party cover.
- Contents insurance – you will want to check with your provider whether this provides for your belongings to be replaced with new items if damaged or whether it simply provides a cash payment which decreases each year as your belongings get older.
- Construction insurance – if you are carrying out building works.
You may want to consider purchasing an all risks policy – un contrat d’assurance multirisques habitation.
Our estate agent is asking me to sign a bon de visite – is it binding?
The bon de visite is used by estate agents as confirmation that a buyer has been introduced by them to the property. It is a way of the estate agent ensuring that their commission is paid (and that you don’t form a separate agreement to buy the property without the estate agent being involved).
If you sign the bon de visite, you are not entering into a binding legal agreement to buy the property.
I am considering renovating a property – where can I find a local tradesman?
You can ask your estate agent for a recommendation. Alternatively, you can search for registered tradesman in your local area using the government website: Chambre de Metiers et de l’Artisanat.
Article written by Charlotte Macdonald and trainee solicitor, Bryony Anning.
For more information please contact Charlotte Macdonald, Dan Harris or Raquel Ugalde at Stone King LLP either by calling +44(0)1225 337599, or by emailing: [email protected]