The French property buying process is strictly regulated and not always straight forward. As a buyer’s agent, Home Hunts works on behalf of the buyer offering support every step of the way. Here is a brief overview of what is involved in the French property buying process to help you understand what to expect when you buy a property in France.
If you are considering buying a property in France, first and foremost it is important to be clear on your criteria and why you are buying the property. Will it be a permanent or holiday home, or is it more likely to be a rental prospect that can bring in a little extra income? Whatever the goal, it needs to be defined right from the start.
What exactly are you looking for?
Making a list of the most important elements can help to define what you are looking for in a property. What is the property for? Do you want a garden or would you be satisfied with just a terrace or balcony? Do you need to live near a town or would you prefer to be in a rural area? Home Hunts has a questionnaire that can help buyers to really focus on what it is they are looking for.
How will you buy your property?
The next step is to consider how you intend to buy. The country is experiencing highly favourable buying conditions at the moment, which includes low interest rates and advantageous currency rates, and the three main options are: buying with cash, re-mortgaging your main home to raise the cash or getting a mortgage.
What additional costs will you encounter?
It is important to be aware of the costs that will be incurred throughout the French property buying process. These come from four main areas: the purchase deposit, mortgage deposit, notaire fees and agency fees.
Purchase deposit: When you sign the compromis de vente (the sales agreement contract) you will pay between 5-10% of the purchase price. The deposit is held by the notaire or agent until completion.
Mortgage deposit: This amount depends on your nationality, where you live and where you pay income tax. Non-French nationals usually need to provide a deposit of 25-30% of the purchase price.
Notaire fees: The cost of legal fees and taxes on an existing property are around 6-7% of the purchase price (and 3-4% for a new build), plus 0.5% of the amount borrowed for registering the mortgage. All notaire fees are calculated on the same basis, so you cannot “shop around”, but you do have the freedom to choose your notaire.
Agency fees: An agent’s selling fee is usually around 5-7% and is often built into the sales price and paid by the vendor from the proceeds of the sale.
What other charges should you be aware of?
There are two taxes on all residential property in France: taxe foncière (land tax) and taxe d’habitation (local tax). The exact amounts depend on location and vary greatly, so check with your agent during the property purchase process.
Additional cost areas to find out about include communal charges (charges de copropriété) if you own a property within a complex, and French succession laws, which apply to all property owners. Note that in France you cannot leave your real estate assets to anyone you please, blood relatives come first, so it is important to seek advice on this during the French property buying process.
Who are the professionals involved?
The French property buying process can be complicated and will require the involvement of numerous professionals along the way. The Home Hunts team is in contact with leading experts all over France, so you can be sure to deal with the best when buying a property through Home Hunts.
The estate agent: Usually working locally, the estate agent earns commission from the sale of the property and will try to obtain the best possible price for it.
Buyer’s agent: A buyer’s agent, like Home Hunts, provides a tailor-made, bespoke service at no extra cost to you – this is possible because Home Hunts is paid an introducer’s fee by the estate agent. Home Hunts supports its clients throughout the French property buying process.
Notaire: A public official, the notaire advises on property, family, succession and corporate laws. During the French property buying process, the notaire is responsible for conveyance, document preparation and the various property checks.
Mortgage brokers: Banks and lenders have different lending criteria and products, so the mortgage broker saves time when finding a lender that is suitable to your particular needs. Most do not charge for their services but you need to check beforehand.
Architect / surveyor: Both an architect and a surveyor should be consulted if you are buying an existing property or a renovation project. They will also be able to recommended reputable artisans for any work that needs to be carried out.
Tax planning specialists: It is advisable to speak to a tax specialist when buying a property in France, particularly if you are an overseas buyer. Capital gains tax and wealth tax are areas that should be discussed in detail before any purchase.
What contracts will need to be signed?
The compromis de vente, or sales agreement contract, outlines all the details of the property purchase. It is a legal contract and the day you sign it will also be the day you pay your deposit to the agent or notaire. A seven-day cooling-off period begins when you sign and there will be a set date by when the purchase needs to be completed.
Following the mortgage offer and once the notaire has carried out all his legal obligations, completion can take place. A French bank account will have been set up in advance and you will need to have the funds for your mortgage transferred in time. On completion day you will sign the acte de vente, or the final deed of sale, and you will also be asked to show your birth certificate (translated into French), passport and marriage or divorce documents (if applicable).
How can you get free, personalised support after the sale?
As Home Hunts is a buyer’s agent working solely for its buyers, the team extends its impressive service long after the transaction has been made. Home Hunts will help you get the best financial, legal and tax advice and assist with currency exchange, interior designers, landscape gardeners and home technology – whatever you need help with. By choosing to buy your property through Home Hunts, you can be assured the highest level of support, before, during and after the sale.
For a more detailed overview of the French property buying process you can read our definitive guide to buying property in France or download “The French Buying Process” which has been written and created by the team at Home Hunts for their customers. To view properties in Home Hunts’ portfolio, visit www.home-hunts.com, and to discuss your personal circumstances with a consultant, contact the French office on +33 (0)970 44 66 43.