Buying property in France
Most of the hard work of the process is handled by the notaire, a public official whose involvement is necessary to make the purchase legal and valid, and to guarantee that the relevant taxes and duties are paid to the taxman, aka the Trésor Public
The buying process begins when the two parties, buyer and seller, have agreed that a clearly defined and clearly circumscribed piece of property is to change hands in exchange for a clearly defined sum of money upon which both parties agree. It is wise, however, to pay as much attention as possible to the stage in the buying process that is entirely in the hands of the buyer, i.e. the sale agreement (promesse de vente), the only legal document taken into account in case of disagreement. It is also in the best interest of the buyer to take his/her time, not just to study the property itself, but also to study the various documents that come his/her way, and in particular the sale agreement. The buyer should feel free to ask as many questions as he/she wishes, and to ask to amend or remove whatever clause in the agreement he/she finds unsatisfactory.
The sale agreement
• The first stage in the buying process is the writing up and signature of the sale agreement (promesse de vente).
• The promesse de vente is a pre-contract which binds both parties, though in different ways, and guarantees that the transaction, though it is not fully completed due to the time needed to procure the relevant papers and pay the relevant taxes and duties, will eventually take place as agreed.
• The actual deed of sale (acte [de vente] authentique) in a way only finalizes and formalizes the binding agreement reached in the promesse de vente.
• With the sale agreement, the seller is committed to selling his/her property, while the buyer is committed to buying under the condition that he/she is in possession of the necessary funds. The commitment is materialized in the form of a deposit paid by the buyer, usually corresponding to 10% of the total price.
• It is important to specify in the agreement under what conditions the deposit is to be retrieved by the buyer should the transaction be cancelled (clause de désistement unilatéral, as opposed to clause de désistement réciproque).
• Failing this, the rule is that if the buyer withdraws with no valid reason, he/she waives all claims to the deposit, and if the seller withdraws, he/she pays back double the amount of the deposit.
• The sale agreement is a written document which is either signed directly by the two parties alone, by the two parties in the presence of an estate agent (agent immobilier), or in the presence of a notaire.
• When it is signed directly by the two parties alone, the document must be registered at the recette des impôts (the tax office) corresponding to the place of residence of either of the two parties within ten days after it has been signed.
• A number of other clauses must appear in the sale agreement:
- a description of the property (exact address, exact surface - guaranteed by a Loi Carrez certificate;
- the mention, in the case of property under construction, of the ground surface upon which the property is to be built, and of the completion of the work on the collective equipment (water, gas, electricity, etc.);
- the price;
- the mention of any constraint bearing on the property, imposing limits on its use and enjoyment;
- a clause specifying that the property is not mortgaged;
- the date of the signature and the date of expected delivery;
- the amount of the agent's fees and which of the parties is supposed to pay them.
• Do not forget to check the sale agreement against other documents such as the building's regulation sheet (règlement de copropriété) if the building is in co-ownership, and the terms and conditions of construction (cahier des charges), if the property is under construction.
The deed of sale
• Once the conditions for the sale have been fulfilled and the necessary paperwork has been done, the actual deed of sale is signed in the presence of the notaire who has carried out the work.
• It is often the case that anything between one and three months go by between the signing of the sale agreement and that of the deed of sale. It is usually the time needed by the notaire to obtain the necessary papers and permissions, and by the buyer to gather the funds.
• It is at the time of the signing of the deed that the remainder of the price is paid - original price minus the 10% deposit - together with the notaire's fees.
• It is possible for one of the parties to be accompanied by his/her own notaire or legal adviser, in which case the fees will be shared between the two.
• The notaire usually keeps the original of the deed of sale, of which he/she is the legal guardian. Each party is given a copy, to be kept carefully, and the buyer is given the keys to the property. The transaction is complete.