© 2006 SARL Classic French Homes

Page Updated November 6, 2007

The Purchase Process in France

Buying property in France is completely different from buying property in the United Kingdom, Hong Kong or the United States. It is in many ways an easier and much more secure system for both purchaser and vendor, although you need to be fully aware of all the pros and cons before you start the process. We aim at Classic French Homes to make the whole process as easy and as efficient as it can possibly be.

Your Enquiry

Having received your initial enquiry, we aim to respond the same day with full details of the property you requested and details of further properties that may suit your requirements as to area, size, type, condition and price etc. It obviously makes our search much easier if you can give us as much detail as possible on your requirements and wish list.

Following this email, we will contact you to find out if our properties appealed to you and keep in contact until such time as you are ready to view properties in France.

Once you have identified a property or properties that you would like to visit, we will make appointments with the vendors for you and create a viewing schedule for your visit. We can also help with travel advice, hotel recommendations/bookings and routemaps. To ensure we provide the best service, we will ask for extra information on your visit, for example, if we have not arranged it for you, when and where you are staying, how long you are staying, a telephone number that we contact you on throughout your trip (preferably mobile). This information is crucial if a property sells, appointments change or new properties become available.

Viewings

On meeting you, we will have all the information on your requirements and can discuss these further to ensure we show you the best suited properties. We will accompany you to view all the properties that you wish to see. We advise leaving an extra free day at the end of a visit, to allow for second viewings, time to explore a certain area etc. For each property, we will ask you to sign a “Bon de Visite”. This does not commit you to anything, it is just to confirm that we have taken you to see the properties listed.

Our properties are all prestige properties that have a large amount of accommodation, beautiful gardens/estates and often with many outbuildings. These properties take time to view and we schedule appointments to allow time for this.

If there is a property that you are interested in after an initial viewing, we can view again. In addition, we will provide you with the “plan cadastral” (plans of the property and it’s land) and give you our advice as to making an offer. We will endeavor to obtain the best possible price for you.

Making your offer

The purchase price of your property will be in Euros. This price includes our agency commission but does not include the Notaire’s fee and taxes. As an indication, when buying property off-plan the fees will be 2-3%. When buying a property under 5 years old from the first purchaser who originally bought off-plan again the fees will be approximately 2-3%. When buying a property over five years old, which nearly all our properties are, the fees charged are between 7 and 10%. The reason for this difference is that new homes have TVA (VAT) included within their prices and therefore no tax (stamp duty) is payable. The Notaire’s fees can be confirmed before putting in an offer.

Building surveys are not usually done in France but surveyors do exist. We have a local English RICS qualified surveyor who can give you a full UK-type survey, if you wish. The other option is to have a registered builder's opinion on the property, this is what the French tend to do. We can discuss these options with you before you offer on any property. Any surveys are normally undertaken during the seven day cooling off period.

You should also take advice on your inheritance provision. Whatever your nationality, the inheritance of your property is subject to French law and the provision made has to be included in the house-buying contract. We advise consulting a legal representative on this as French inheritance law is extremely complex and you don't want to find a surviving partner paying unnecessarily high death duties if the worst should occur. Again we can arrange this advice for you.

An offer to purchase can include conditions, a common one is the obtaining of a mortgage. (So common in fact, that if you are not applying for a mortgage you will have to insert a special paragraph in your contract to confirm this. A mortgage application cannot be made without a signed first contract accompanying the application form). Be aware that when purchasing with a mortgage, the Notaire will make a further charge to register the lender’s interest on the property, normally about 1.5% of the mortgage amount.

Unlike in the UK, it is not normal for parties to have separate solicitors. In France, one notaire acts for both parties. A Notaire is the only person empowered to convey property in France. We will recommend a local Notaire. The Notaire is able to advise on any question regarding property or family law. If you would prefer some additional advice from your own personal solicitor, we can also recommend a local solicitor who specialises in this area. Remember these will be extra fees over and above the Notaire, as the purchaser pays for the Notaire in any event.

When negotiating a deal, we refer to the gross price (ie including agencies fees), although when it comes to framing the deal for the Notaire, we usually strip out both estate agency fees and furniture that may be included so that the Notaires' Fees are reduced to the net price for the property. Our standard fees are 5% +TVA - this is both the norm and average amongst agents, with the range typically being 4 to 8% +TVA. Whilst we feel it fair to charge the standard, we trust that the quality of service we give both vendors and buyers is second to none.

Purchase Procedure

Once you have made an offer and a price has been agreed, the sales contract (“Compromis de vente”) is drawn up by the Notaire. The compromis is like the first draft of the final contract. Basically, it sets out the details of the purchase (what you are buying) and those involved in it (the seller and the buyer) as well as showing how much you are paying (including the fees). It has to be signed by both buyer and seller. The compromis is like the first draft of the final contract. Basically, it sets out the details of the purchase (what you are buying) and those involved in it (the seller and the buyer) as well as showing how much you are paying (including the fees). It has to be signed by both buyer and seller. This is the time to raise any conditions you require that would enable you to withdraw from the sale, for instance: your failure to obtain a mortgage, negative results from termite surveys, or failing to receive planning permission to convert outbuildings.

In order to have the compromis drawn up, you will need to provide your passport and relevant marriage and divorce papers. If you're borrowing money to purchase the property, you'll need paperwork with details of the loan. Ideally, you should take this documentation with you on your search trip, as that will allow the process of drawing up the compromis to begin immediately. You should expect the compromis to take 2-3 weeks to arrive.

In summary, this contract will include the following;

1. The names, addresses, dates of birth and profession of all parties.
2. A brief description of the property including land and outbuildings. This will include all relevant land registry numbers.
3. The price
4. Any special conditions. These are called “Conditions Suspensive” and will include things such as a mortgage.
5. Further contract conditions. These are called “Conditions Particulières. This is where a move in date will be included if this is different from the completion date.
6. The deposit. This is normally ten percent of the purchase price and is held by the Notaire until completion.
7. The completion date. This is normally two/three months after the signing of the Compromis de Vente.
8. The name and address of the Notaire. The buyer has the right to choose the Notaire but is normal to use a Notaire local to the property.

The contract is now also conditional on reports being provided in most areas for termites, asbestos and lead. The vendor must provide these by completion. In certain instances you may make the contract conditional on obtaining permission to convert outbuildings to living accommodation, permission for a pool etc. The first contract is always conditional on local searches, checking of ownership, etc which is completed by the Notaire.

Cooling Off Period

Once the Compromis has been signed by both buyer and seller and the deposit has been paid, you still have a seven day “cooling off” period. During this time, you can withdraw from the sale without penalty but the vendor cannot. If you exercise this right, a registered letter must be received by the Notaire before the seven days has elapsed.

Once the cooling off period is complete, the contract is binding on both parties and then the deposit is due (very occasionally, deposits can be required sooner but this is rare). The deposit is usually 10 per cent of the net purchase price but can sometimes be less. The compromis is now a binding contract (subject to the clauses suspensives) and if you withdraw, you could lose your 10 per cent deposit.

Once you have signed the compromis, the searches on the property begin. These will include ownership, land boundaries, rights of way, termite checks, lead and asbestos surveys. The notaire is responsible for ensuring that these take place and you do not need to pay separately for them.

You need to transfer the balance of your payment plus the legal expenses to the notaire's account in plenty of time for the final signing date, it is normally about 10 weeks after the initial contract. This date will have been agreed with the vendor, via either us or the Notaire and it is important that you meet the deadline. If you miss the completion date, you can lose both the house and your deposit. This transaction may also involve your mortgage lender, who must ensure that the money for completion is in the notaire's account in plenty of time. No transaction will be complete until all monies have been cleared in the notaire's account.

Completion

On the day of signing, we will visit the property with you to check all is in order as the final contract (“projet”) has a clause stating “sold as seen on signing date”. The signing will be held in the notaire's office and it's usual for all parties to be there for the completion and siginging of the final “Acte de Vente”. If you can't be, you can arrange a power of attorney for it to be signed in your absence. A power of attorney ‘PROCURATION’ can be provided allowing either or both parties to be represented by the Notaire’s clerk or other named person. The power of attorney may need to be witnessed at the French Consulate in the UK. It must be arranged in advance of the agreed final date This final stage involves reading through the whole contract and finalising any outstanding issues. You will sign a deed in front of the notaire and the ownership of the property will pass with this signing. Be prepared, as the completion process can easily take over an hour. You will be given the keys after the signing and hoorah the property is yours.

After Completion

You will be responsible for paying the equivalent of annual council tax on the property. These are split into those collected by the local council and those collected by the government: Taxe d’habitation and Impot Foncier. They are collected annually in arrears and are usually lower than for comparable properties in the UK. For new properties you have the first year free. Insurance of the property is not your responsibility until completion.

Even if you are not taking a mortgage on your French property it will still be necessary to have a French Bank account to pay your utility bills etc. Your bills can be sent to your permanent address and the money can be taken by direct debit from your French bank account. It is best to open an account once you have found a property. Again, if you need advice or assistant in setting this in place, we can recommend a local company who provide this service and much more including translation.