The Cost of Selling a Property in France: Taxes, Fees, & Surveys
If you’re looking to sell your French property, it’s not only important to consider the sale price but also the costs associated with selling the property itself. How much do you need to allow for estate agent’s and notaire’s fees, what work or surveys need to be legally carried out, and will you be liable for capital gains tax on the property? Here’s what you need to know about the cost of selling a property in France.
Before You Sell: Legal Requirements for Selling Property in France
The first thing you need to think about before selling your property is whether or not your house is in the best state to sell. This is particularly important when putting older properties on the market, especially those where substantial renovation works or repairs may need carrying out.
There are no legal minimum requirements regarding the state or liveability of a property sold in France, but it is a legal requirement for sellers to disclose all relevant information about the property to the buyer (including so-called ‘vice caché’ or hidden defects that the seller is aware of) and to carry out the mandatory diagnostic surveys (more on that below).
Repairs and Renovations
Although there are no legal requirements to carry out repairs and renovations prior to selling, naturally, the state of your property will affect not only the type of buyers that your property will attract but also the selling price. Major repairs left unattended could make the property far less attractive to potential buyers and even affect the possibility of a sale.
Therefore, it’s a good idea to think carefully about the value of your property and the potential asking price, then weigh this up against the cost of carrying out any required work. For example, as energy efficiency is increasingly becoming a key concern for buyers, improving your property’s ‘Diagnostic de Performance Énergétique (DPE)’, the Energy Efficiency Rating issued to your home, may substantially increase the value of your property. Renovation grants for those looking to improve their property’s energy efficiency rating are currently available for buyers, so this might be something you wish to look into prior to selling.
One final thing to remember is that if you are hoping to carry out DIY renovations in the hope of saving money, the law in France dictates that any construction works carried out on a property are guaranteed by the builder (i.e., you!) for ten years. So, be sure that you know your rights and responsibilities before you set to work.
All sellers in France are required by law to carry out a series of ‘diagnostic surveys’ prior to selling a property, which include reports on gas, electricity, asbestos, wastewater drainage, termites, and more. These surveys make up your ‘Dossier de Diagnostic Technique (DDT)’ and are carried out at the seller’s expense.
The diagnostic surveys are typically carried out after an offer has been made on the property and the compromis de vente has been signed, with the exception of the ‘Diagnostic de Performance Énergétique (DPE)’, which must be carried out prior to putting your house on the market.
The cost of carrying out these diagnostic surveys will depend upon the company you use, the location of your property (prices vary considerably between regions), and the type of property (you should expect to pay more for a large rural property than a small city apartment, for example). A very rough average price is about €200, but these fees can climb up to €600 in certain circumstances, and it’s definitely worth shopping around to get the best price.
Selling French Property: Estate Agents & Notaires’ Fees
In France, you may choose to sell your property privately or go through an estate agent, but either way, it is a legal requirement to appoint a notaire to carry out the legal transaction of your property sale. This service is not free – in fact, it can be a substantial sum, typically between 6% and 8% of the property sale price – but the good news for sellers is that this fee is always paid by the buyer.
When it comes to estate agents’ fees or commissions, these are often also paid by the buyer; however, it is crucial to understand the contract (the mandat de vente’) that you have in place with your estate agent. The ‘mandat de vente’ should clearly lay out any fees or commission (honoraires) that are payable and whether it is the responsibility of the buyer or the seller. These fees can be around 6-10% of the property price, so it’s important you understand exactly who will pay what and the difference between the property’s advertised or sale price and the amount you will actually receive.
Deciding on a Sale Price: Valuing Your French Property
The post-pandemic property market in France is very dynamic, with a huge increase in demand for properties, particularly in rural areas. House prices have been steadily increasing in popular areas since 2020, and with properties tending to sell very quickly, it’s become very common for houses to sell for the asking price. All of this makes it an excellent time to put a property on the market and potentially a smart time to maximise on your investments.
There are many different factors that come into play when deciding a suitable sale price for your property, including the property itself, its location, the current market and demand, and of course, your personal situation, needs, and preferences. It’s a good idea to get your property valued by at least three different local estate agents or notaires, as well as researching similar properties on the market before you decide on a price that suits you.
It’s important to note that estate agents in France cannot charge for a property valuation (‘estimation’). This is a free service and should not come with a requirement to use that estate agent, either – you may choose to go with the estate agent of your choice or sell privately as long as you haven’t signed a ‘mandat de vente’ stating otherwise.
Additional Fees and Taxes When Selling a French Second Home
If you own a second home in France, especially if you are not resident in France, there are additional costs and fees that may come into play when selling your property. Here are a few of the most important costs to factor in.
Capital Gains Tax
If you are selling a property in France, you will be liable to pay French capital gains tax if:
- You are selling a second home, property, or land that is not your main residence.
- If you have owned the property for less than 22 years (or less than 30 years for the applicable social charges)
- If you sell your property or land for more than €15,000
In France, capital gains are subject to both capital gains tax (impôt sur les plus values) at a flat rate of 19% and social charges (contributions sociales) at a flat rate of 17.2% —a total of 36.2%. There are also allowances relating to the duration of ownership.
Non-residents are equally liable to pay French capital gains tax and social charges – although the amount of social charges will depend upon your country of residence.
Read our guide to Understanding French Capital Gains Tax: What You Need to Know
Hiring a Fiscal Representative
If you are resident in a non-EU or EEA country (for example, the United States or the UK), it is a legal requirement in France to appoint a fiscal representative when selling a property in France. This rule applies to any property sold for more than €150,000, and there are very few exceptions – broadly speaking, if your property is liable for capital gains tax, you will also need to appoint a fiscal representative.
Importantly, the fiscal representative is required in addition to the notaire, and unlike the notaire, it is the seller who will be liable for the associated fees. These fees may be between 0.4% to 1% of the sale price of the property and will be deducted from your capital gains.
Read our guide Do I Need a Fiscal Representative to Sell My French Property
If you are selling a French property from outside of the EU and plan to exchange your euros back into pound sterling, US dollars, or another currency, it’s just as crucial to think about currency conversion as it was at the time of buying your property.
Currency exchange rates fluctuate, and transfer fees will, of course, need to be deducted from the sale price of your property. While the nature of selling a property may give you a little more flexibility over the timeframe of converting your euros back into your home currency, this will depend largely upon how quickly you need to access the funds. For example, if the currency exchange rate was less than favourable at the time of selling, could you afford to keep the funds in your French bank account until a more favourable rate was available?
Our advice is to get in touch with a specialist currency broker, like our partners at Moneycorp, prior to putting your property up for sale. Not only can they potentially save you hundreds of Euros when transferring funds from France, but they can also explain the different options available to protect against shifting exchange rates and minimise associated transfer fees.
Translation and legal fees
One final thing to consider is that as a foreign seller, you might find you want to appoint an English-speaking legal representative or seek advice from a French law specialist or tax advisor. You may also require the use of a professional translator to translate legal documents and contracts (which will all be in French) into English. Our FrenchEntrée directory has listings of English-speaking specialists in all of these areas, and it’s a good idea to book an appointment prior to putting your property up for sale.
Are You Ready to Sell Your French Property?
Whether you choose to sell your French property privately or through an estate agent, need expert advice on the legal procedure or capital gains tax, or want to brush up on your knowledge of buying and selling in France — FrenchEntrée is hear to help! Our Essential Reading guides are the best place to start.
Once you are ready to sell, you might also choose to advertise your property in our French Properties for Sale database or French Property News magazine.
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Our solicitor experts Stone King LLP have said:
‘The issue is whether you are British nationals, as opposed to British Passport Holders, which is not the same thing. Assuming you are British nationals, then it is possible to apply the provisions of the EU Succession Regulation 650/2012 (‘the Regulation’) so that ‘British’ law applies to your succession (who gets what) when you die. The problem is that ‘Britain’ is a federal jurisdiction, which means that the laws of England & Wales are not the same as the laws of Scotland and Northern Ireland. Assuming that you are a British national, most closely associated with England & Wales, then you can choose Anglo-Welsh law to apply under the Regulation which would allow you to pass your assets in France to whomever you wish. However, there is a further complication, which is that on the 1st November 2022, France introduced an amendment to Article 913 of the French Civil code, so that it is possible for disaffected beneficiaries, in certain circumstances, to make a claim against your French estate. Our view is that this provision is contrary to EU law and it is likely to be set aside by the European Court of Justice in due course, but it is the law at the moment. Stone King LLP may be able to help with other structures and provisions to help you achieve your preferred outcome.
Daniel P Harris, Partner – Head of International & Cross-Border, Stone King
You can contact Dan at Stone King by calling +44(0)1225 337599 or by emailing [email protected]