Buying a property in France - the basics

Costs
Terms explained
Things to do when you move in
Mortgage Approval

The Buying Process

1.  Research the area.
There are lots of companies selling French Property.  Firstly, we recommend that you do a bit of research on the area where you are considering buying.  If you are going to spend hundreds of thousands of euros on a property, why not spend a couple of euros researching the topic. Click here for books on buying property in France (from Amazon).

2.  Put together a checklist of what you want - 
e.g. near to golf courses, close to the beach or city, number of bedrooms etc.

3.  Find a Property. 

4.  Get a Structural Survey.
Most people buying property in Ireland get a structural survey to insure that the property in in good shape.  It is advisable to do the same when you are buying a second hand property in France (or elsewhere)

5.  The conveyancing system is very different to the system of buying in Ireland.  In general, it is possible to make similar 'searches' or enquiries to those we make when you buy a property in Ireland.  But, it is important to note that The French 'Notaire' who you sign the legal documents and land transfers in the presence of is NOT there to give legal advice to either the buyer or the seller, but is only there to witness the signatures and to deal with certain administration functions.  It is therefore very important to get independent legal advice which can usually be arranged through your estate agent.  The process is broken into two stages (as it is here in Ireland).  Firstly you sign a conditional contract which can be prepared by a 'Notaire' or an estate agent.  You then sign a formal non-conditional Deed of Sale called the 'Acte de Vente'.  The sale can take up about three months to conplete.

6.  Get legal advice (on whose name you should purchase the property in)
There are a number of options open to you, each with advantages and disadvantages.  It is very important to look at these options (in conjunction with looking at your existing will, and consider getting a French will).  The potential tax savings of setting it up properly at this stage are huge down the line as the French system of Inheritance tax can attract very high rates of tax.  If you gain nothing else from this guide, please take note of this.  The options for purchasing the home are:

# Buying the property in your own name
# In joint names with your partner
# In your children's names who will eventually inherit the property
# In the name of a limited company
# In the name of a SCI (a type of French company used to own and manage properties in France)
# By way of a Family Trust 

This guide is general.  There is no substitution for legal advice  .We suggest that you get legal advice so that you can buy the property in the most tax efficient way.

7.  Finance.     (back to top)
You have 2 main options when it comes to financing the purchase - you can try to source a mortgage through a French lender or you could consider remortgage your Irish Property to finance the purchase.  

Getting finance by way of re-financing your existing mortgage can allow you to borrow enough to cover 100% of the purchase price, all fees and additional costs such as buying furniture, as long as you have sufficient equity.  

Arrange up to 100% finance for your overseas property, by refinancing your Irish Property

What Costs are involved?     (back to top)

As a rule of thumb, you should allow approximately 10% of the purchase, for fees and taxes.

Notaire Fees (some figures listed in francs)
These vary depending on value of the property and size of the mortgage:
On the Property - 1.65% (+ vat @ 20.6%) if property price is between 40.000 Francs and 110.000 Francs
On the Property - 0.825% (+ vat @ 20.6%) if the property costs more than 110.000 
On the mortgage - approx. 65% of the rates listed above for property conveyancing (+ vat @ 20.6%).

New Property - additional tax if the property was built in the previous five years

Land Registry taxes (TPF)
- They vary from district to distract (subject to vat @ 0.6%).

Department tax

Additional tax of 2.5% (of the Department tax figure)

Communal tax 1.2%

Stamp Duty - varies usually €200 - €250

Miscellaneous Land Registry fees - usually less than 1% of the property value 

Survey Fees
If you get a structural survey, which we recommend you get regardless of which country you buy in, you should allow a couple of hundred euros. 

Terms     (back to top)

Acte de Vente
This is the Title deed showing who the owner of the property is and giving a description of the property.

Cadastre - Land Registry

Contrat de Vente sous conditions suspensives (or Compromis de vende)
This is a preliminary contract which is conditional subject to conditions such as mortgage approval, leans on the property etc.

Fiscal Representative
If you are buying a home in France as an investment or holiday home rather than living there all year round, it is a good idea to nominate someone to act as your 'Fiscal Representative'.  This person will receive any correspondence from the tax authorities.  The fiscal representative has to be a resident of France - but it's up to you who to choose - a friend, tax adviser or lawyer.

ISF (Impot de solodarite sur la fortune)
Wealth Tax - If you have assets to the value of 4.700.000F or more in France you have to submit a wealth tax return.

Inpots sur la Revenu 
Income Tax - Even if you're not planning to work in France you will have to submit an income tax return on income you earn in France such as rental income and interest earned from your bank.

Notaire (Notary)
This is a public official who prepares the title deeds and records that the deed has been signed in his presence and is understood by the buyer and seller.  The Notaire does not give independent legal advice.  He will make the various title searches about the property. 

Taxe sur la valeur ajoutee
This is the French for VAT.  You have to pay this tax at 20.6% if the property is new or if it is sold for the first time within 5 years of being built.

After you complete the purchase