Buying an apartment in central Paris is a forbidding task for the financially conservative but for the rich, it can be the most exhilarating experience. To be in the city center means access to all that glitters in neon lights, buildings, shops, museums, art, architecture, theatres and many more.
Offer and acceptance
- As in all purchasing transactions in France, the first step in the buying process is for the buyer to make an offer to buy a house, apartment, villa or condo etc.
- The offer needs to be accepted and if the owner accepts, two types of agreement can be signed – a promesse de vente or acompromise de vente.
- The promesse de vente allows the owner to sell the property to the buyer at a given price but keeps the option open for 2 or 3 months. After the agreement is signed, the buyer pays a deposit of 10% of the total purchase price. The owner cannot sell the property during this time but if the buyer chooses to withdraw, the 10% deposit already paid is forfeited.
- The compromise de vente allows the buyer and seller to agree on a price and the buyer pays the 10% deposit which indicates the buyer’s commitment to buy. Either party can claim damages in court if they choose to withdraw from the deal.
- Both types of agreements have a “cooling off” period of 7 days during which the buyer can withdraw from the purchase without any penalty suffered.
Checking the contract
Before signing the agreement, it’s crucial that it is entirely checked to ensure that it contains full details of everything that are the subjects of the sale such as:
- Adjoining buildings
- Fixtures and fittings
- Deficiency reports on electricity, gas and dangerous pests and materials
- The inclusion of conditional or escape clauses
- The notaire will conduct investigations of 3 months or more on any legal, financial or other claims on the property and simultaneously, a completion date can be set for signing the deed of sale (acte de vente)
- As the investigation proceed, an architect or surveyor can be called at this time to carry out a structural rundown of the buildings to justify value and ensure safety.
- It would also be prudent to consult the notaire before signing the deed of sale about what would happen to the real estate in the future. In France, real estate owned by parents always pass on to children, even those owned by foreigners, but it would do no harm to be absolutely sure about it.
The main costs attached to any real estate transactions include:
- The notaire’s fees which are set by the French Minister of Justice at 5% or up to €45,735 plus a 3.5% commission.
- All or part of the estate agent’s fees which can be up to 10% of the purchase price.
- 2 types of taxes – land tax or taxe foncière and local taxes or taxe d’habitation due each year on January 1. The amount is usually paid on a pro-rata basis.
The Deed of Sale
- After all the searches and investigations have been completed, and the funds are in hand to pay for the accommodation, everything is set for an approach to the notaire’s office for signing the deed of sale or acte de vente.
- The foreign buyer may require the presence of a translator during the signing so that the document which is read out loudly can be translated on the spot before the agreement is actually signed.
- After the signing of the agreement, the payment of fees and taxes can be processed to complete the transaction.
- Once these steps are all completed, the deeds of the purchase will then be registered in the books of the Land Registry and the buyer becomes the new owner of real estate in France.