Selling a property in France can feel like a daunting task, especially if you don’t know how the process works. To help you get started, we’ve put together six things you need to know before you sell your French property.
1. Your Property Size and Value
Before you put your property on the market, it’s important to know the correct size of it, which will in turn help you to price it right. Even if you decide to sell it yourself (instead of via an agency), it’s best to contact an expert who can measure your property – there are different measurements required, from surface habitable (living surface) to Loi Carrez (a specific measurement in France). Plus, property surface areas are calculated differently depending on the type of property. If you provide an incorrect measurement of a surface area, the buyer can void the contract or begin legal proceedings – make sure you get it right the first time!
Once you have the correct surface area, you can then move onto the price. Bringing in an agency, or preferably several agents, to value your property is a great idea. They are experts who have a lot of knowledge of the property market in your area and will be able to advise you well. Getting the price right the first time is crucial so that you don’t come across issues later down the line.
2. The Role of the Notaire
In France, it is a legal obligation to use a notaire (French solicitor) when buying or selling property. You may already know a notaire from when you bought your property, but in any case make sure you already have someone in mind. Not only do you need a notaire to sell your property, their role is very important as they handle everything from the very first contract signing (compromis de vente) right up to the exchange of keys. Learn more about the role of the notaire.
3. The Cost of Selling Your Property
Selling a house in any country incurs various costs and France is no different. It’s important to know what fees you are likely to pay, as they do differ from other places.
First off, if you decide to sell via an agency, you need to know what commission they will take. Depending on the area, it can be the buyer, the seller or both who pay this commission. What’s important is to know this before you agree to an agency selling your property.
Secondly, there are fees related to technical reports, such as reports about termites, asbestos, etc. As the seller you are liable for these so it’s good to speak to an expert. The term used in France is the Dossier de Diagnostic Technique (DDT) – in other words the Technical Diagnostic File.
Thirdly, don’t forget about capital gains tax! This is only in the case that the property you are selling is not your main residence – so it affects anyone selling a second home in France. The capital gain is simply the difference between the purchase price and the resale price – you have to pay tax on this amount. Some exemptions do apply. Visit our French tax zone to learn more.
4. The Importance of the Compromis de Vente
This is one of the most crucial points to be aware of – once you sign a compromis de vente (preliminary sales contract), you cannot back out of the sale. When you are the buyer, there is a ten-day cooling off period in which you can change your mind without any penalties. As the seller, this is not the case! When you sign this document, it is the equivalent of a sale and is legally binding.
5. The REAL Price of Your Property (i.e. Currency Exchange)
Getting through all the previous steps and selling your property is great, but there are still other elements to consider, mainly currency issues if you are planning on moving your money to a country which does not use the euro. Transferring such a large sum of money from euros to pounds, for example, will incur hefty costs. It’s best to avoid asking the bank – they are likely to charge a lot of money in terms of transfer fees, and the currency exchange rates are unlikely to be the most competitive. A currency exchange specialist such as Moneycorp can help save you money and secure the best rate, especially if you are looking to transfer a large sum of money.
Even when using a specialist, currency exchange rates are always subject to change, and a smart way to counteract this is to use a forward contract. This allows you to fix an exchange rate for your transfer, meaning that even if you receive the balance of your money a few months later, you don’t need to worry about exchange rate fluctuations.
Make sure you know your options by speaking with an advisor and opening a free currency account before you put your house on the market.
6. Preparing Your Paperwork
French administration and bureaucracy can be overwhelming for expats and the best way to overcome this is through preparation. When you sell a house, the buyer will often request access to different documents (receipts from any work done, costs to run the house, floor plans, taxes, etc) so it’s a good idea to prepare all of this in advance before your property hits the market. That way if a buyer makes you an offer, it won’t be delayed due to the paperwork.
Ready to Sell Your French Property?
Now you’re all set! If you would like more information on selling your French property, FrenchEntrée has many helpful articles in the Selling Property zone. From first steps right up to the signing of contracts and transferring of funds, we’ve got you covered!