BUYING A PROPERTY IN FRANCE
These notes are written following a meeting of the Twinning Association held on 14 September 2007. The main speaker was Philip Jenkinson of Triplet & Associés in Lille.
I emphasise that they are my interpretation following a most interesting and enlightening occasion.
FINDING YOUR PROPERTY.
Look around carefully and review and compare the range of prices in the area where you are you keen to buy. Do not hand any money to anyone except to a Notary
during this search process. There are three sources to locate a suitable property:
Estate agent (Agent Immobilier). These are highly regulated in France and must be formally registered. Please be aware that French estate agents
are not proactive like those in England. Commissions of 4-5% are not abnormal and payment is due on sale at the completion meeting (see later).
They work in one of two ways:
Notary (Notaire). A Notaire is one of the two French legal professions and specialises in the conveyance of real property and probate matters.
They act as an agent of the French state and often also act as an estate agent but like the agent immobilier they are not usually proactive.
They are authorised by law to hold a client deposit, usually without any interest!
- Mandat de vente – agent paid by the vendor
- Mandat de recherché – agent paid by purchaser
Direct. Like England some properties are offered outside these two channels, say through the press, the internet or via friends.
Again like England sometimes estate agents masquerade as owners so great care is necessary.
FIRST FORMAL STEPS.
Do not expect any document to be in English and there is no defence in saying you did not understand it! Do not sign any document written in French without
knowing precisely the scope of your commitment. Do not get talked into a situation where you are told you have 7 days to retract: many documents do not carry this provision.
Any documents should contain the identities of the vendor and/or the purchaser, the identity of the property with land registry references, general and particular
conditions of acquisition, date for completion and any contractual penalties for non-completion.
Important conditions. Make sure that it contains a “clause de substitution” – allowing you to substitute another individual or corporate body
at the completion stage. The acquisition should be subject to a loan from a named bank and a stated maximum interest rate. There should be certificate
guarantees of the absence of asbestos, lead in the paintwork and termites.
Types of preliminary document.
Searches are not carried out in the same way as in England and title is established through the French National Land Registry. No survey is carried out.
What you see is what you get! The final completion agreement will contain a declaration that the purchaser has had the fullest opportunity to visit and
inspect the property and thus to identify any defects which must be specified and agreed beforehand. 10% is usually paid on signature of the preliminary document.
Costs, fees, disbursements etc usually come to some 7½% of the purchase price.
- Bon de visite. Short document establishing that the agent brought the prospective purchaser to the vendor’s property.
- Mandat de vente. Legally binding written instruction by which the vendor instructs the agent to sell the property. The agent immobilier should be able
to produce this document to any potential purchaser.
- Mandat de recherché. Legally binding written instruction by which the purchaser instructs the agent to find a property.
Commission will be paid and often expenses are charged, even though no property is bought.
- Compromis. Dangerous bilateral legally binding document which commits the parties to completion within 7 days.
- Offre d’achat. Unilaterally binding document which commits the purchaser to buy but does not commit the vendor to sell.
- Promesse unilatérale de vente. Unilaterally binding document which commits the vendor to sell but does not commit the purchaser to buy.
This is rarely used.
Make sure that you have a draft of the acte authentique well prior to the signing. Do ensure that all sums are with the Notary at least 5 days prior to completion.
Cash cannot be used: it is a criminal offence in France.
The completion must be carried out by at least one French Notary. There might be imbalance in the situation if the vendor is a native French speaker so you are
advised to use a Triplet (like his firm).
The completion is carried out in the Notary’s office with all parties present including any banks involved. Non-French parties are asked to present their passports.
Often the cheque is handed over from the purchaser’s notary to the vendor at the meeting and then the keys are handed to the purchaser.
Fees are often handed over also at the same time. Perhaps there is a glass of wine!
Utilities. A new agreement with gas, water etc must be set up immediately to avoid being cut off.
Insurance. The building must be insured immediately from the moment it is sold, as a matter of law.
Local rates. The taxe d’habitation and taxe foncière must be paid and the local Mairie must be advised of the change of ownership.
Title deed. The authentic deed is held by the Notary and a copy will be given to you (with charge). Proof of title comes from the entry in the land registry.
Do invite your Franco-British advisers (possibly Triplet and Associés) to join you for a drink on your new terrace, preferably in early July!