Buying property in France is different than in the UK or other countries of the world and it’s important to understand the legalities. At iad Overseas we want to make the process of buying property in France as straightforward as possible. This article explains how to make an offer and both the buyer’s and seller’s obligations once you do this.
Making an offer to buy your dream property
When you have negotiated and verbally agreed on a price with a property seller in France the next stage of the process is known as the ‘offre d’achat’. This is a document that details all the information about the purchase such as:
- Size of property and land
- Any other relevant points (for example, approved planning permission or boundary agreements)
This document confirms your intention to buy the property for the agreed price and the property should be taken off the market so other potential buyers can´t view it.
The agreement is primarily to prevent gazumping (when the seller accepts a higher price from another buyer), which is illegal in France. It also shows the commitment from the buyer to purchase the property.
Both parties should sign this document, which is drawn up by a notary and the intention to buy within a specified period is noted. If this period passes and the seller has not accepted the offer in writing the ‘offer to buy’ becomes invalid.
At this stage the seller is not legally allowed to ask for a deposit to reserve the property from the buyer, this comes at a later stage.
The buyer’s promise to sell you your ideal home
The ‘promise to sell’ (compromise de vente) is a binding agreement between the seller and the buyer. The price cannot be altered, and the seller cannot sell to anyone else.
This contract of sale is usually drawn up by the buyer’s notary or the estate agent. It is advisable for the buyer and seller to each have a different notary so there is no conflict of interest. Even though there are two notaries the fee should not increase from that originally quoted as it will be split between the two.
The ’promise to sell’ contract should contain the following information:
- Confirmation that the title deeds are in the seller’s name (i.e. they are the legal owner of the property)
- The agreed price and a breakdown of the legal fees
- The amount of the deposit (usually 10%)
- Any conditions that may cause the deposit to be forfeited such as if the buyer pulls out of the sale
- The obligations of both parties
- Any conditional clauses (clauses suspensives)*
- The Dossier de Diagnostic Technique**
- An estimated completion date
- A list of any fixtures and fittings or furniture included in the price
- Any penalties to be imposed if either party does not fulfil their part of the contract.
It details the condition of the property regarding:
- Electrical wiring
- Gas installations
- Septic tanks
- Energy efficiency
- Lead or asbestos materials, such as pipes or roofs/walls
- Any natural or industrial risks
It is essential you check the « Compromis de Vente » thoroughly and have the document translated by a reputable translator if you do not speak French.
Before paying the deposit, the buyer has a 10-day cooling off period when you may withdraw from the sale with no penalties. However, after 10 days you will be charged a penalty if you change your mind about the purchase.
At this stage, a deposit is paid to the seller. It can be any amount the parties agree on but is commonly 10%. If a property is of high value, the buyer may offer to pay a smaller deposit.
The deposit is paid to the notary who will hold it until the sale goes through. Under no circumstances should you pay any money to the seller as this is illegal and you risk losing the money.
Once the seller receives the deposit and has signed the « Compromis de Vente » they are legally bound to sell the property to you and you have a legal obligation to buy it.
If you withdraw from the sale now, you will lose the deposit and may have to pay other expenses, such as the agency fee. However, if any of the conditional clauses are not met within the agreed period you should have your deposit returned.
You’re almost there – the purchase agreement
This is the legally binding agreement between the seller and purchaser for the transfer of the property. It is known as the Acte de Vente and should be drawn up by a notary within 30 days of the ‘offer to buy’ document being signed.
The document is drawn up by the notary and the seller, buyer and notary/ies must be present for the signing. If you are unable to attend you can allocate a person with power of attorney, but this cannot be the estate agent.
If you are not fluent in French it is advisable to take an interpreter with you so you understand everything that is being said. Or …
Your bank should transfer the outstanding funds to the notary, who will send the money to the seller.
Once this part of the buying property process is complete, you will be the legal owner of your new home in France – congratulations!
Our iad Overseas consultants*** are with you throughout the whole process. They speak your language.