Buying a house in France, compared with England
The legal process
Jane and I made a snap decision in the summer of 1997 to buy a property in France for holidays, and as a place to spend much of our time when we retire. It went fairly smoothly, and it was certainly simpler and safer than buying in England. Perhaps we would have done a very few things slightly differently if we had known how things worked.
What we did was to set out our requirements - area, type of property, size, land, etc - together with a very broad price range, and we faxed it to some 30 or so estate agents in England and France who had advertised properties in the right area in newspapers and specialist magazines like Living France and French Property News (we found both these periodicals worth buying on a continuing basis because of the practical experience they contain on French property, buying, and living in France).
Many agents (both British and French) telephoned straight back to get a fuller understanding of what we were looking for. We were then bombarded for weeks with details of hundreds of vaguely suitable properties. We sorted these into the ones in which we were most interested, other interesting ones, and rejects, and from the top category prepared a list of around 30. We then arranged a one week trip to France at about one week's notice and telephoned the respective agents to arrange to view our shortlist.
It was then that we found that several of the best prospects had already been sold, so we substituted a few more from our list. With only five or six days to view we decided to restrict our area of search a little further.
French estate agents or their resident English employees or agents work somewhat differently from their English counterparts. They expect to allocate a whole day at a time to you, or at least half a day. This session often starts in their office where they get to know your preferences and then show you a range of properties from their portfolios which are inevitably bound in ring binders arranged by price; this allows them often to have a full range of photographs of most properties. Only when they have discussed these with you will they pick up the telephone and arrange the view (often they hold the keys). This means some disappointment when your allotted day proves impossible. They then either take you from property to property in their cars, or they accompany you in theirs (we did have one agent turn up on a bike!).
Those agents specialising in selling to foreigners have English associates or English-speaking employees, but others speak little or no English, but go out of their way to be as accommodating as possible. Up to 15 years ago estate agency was almost unknown in France. Properties were sold by notaires, just as solicitors often still offer properties for sale in Scotland. What you might find was a collection of faded standard "Property for Sale" forms in a glass case outside a notaires chambers.
We asked one French-speaking agent about the way the profession has grown up and he explained that the main factor was simply unemployment. Estate agency was an business which someone made redundant could set up without skill or much capital. All they needed was a small lockup shop, a telephone, and a photocopier (preferably colour). We have encountered agents without fax machines and still hand-writing details on the traditional forms. Agents are often one-person enterprises, so don't be surprised to see the shop shut up and a "back later" sign up.
Where the owners were in residence, we found them all extremely welcoming. Often they would insist on conducting the tour of the property themselves - in English or French! Brief glimpses of other people's lives were fascinating - farmers, artisans, the middles classes, and aristocrats.
Having chosen a property, you make an offer - prices are generally negotiable and agents are often realistic enough to give you an idea of just how elastic they may be. Some prices seem ridiculously low, others are unrealistically high. Sometimes pride or family conflict will keep prices too high for decades. We were lucky in that the price of La Citadelle had just been reduced considerably after being on the market for four years since the farmer had retired and moved to a flat in Bordeaux.
The legal process
When the offer is accepted, you proceed quickly to a binding contract. This may be drawn up on behalf of the buyer or the vendor, or by the agent, so can be in many forms, although it will be in simple language. It must by law be a conditional contract, subject to the buyer's specified requirements and all legal requirements being satisfied, so you can insist on as many safeguards as you want - if you want to develop the property it is usual to require planning consent. The law also insists that if you are intending to borrow money for the purchase, the deal can be called off if you cannot get the loan (although the vendor then has an option to arrange a suitable loan for you if you fail to do it). A deposit of 10% or maybe 5% is paid over to the (bonded) agent or to the notaire. Both parties stand to forfeit a sum to the other if they break the contract without legal cause.
The notaire who processes the sale acts neither for the buyer or the seller, but for the State and is responsible for ensuring that everything is done properly. Technically it is the buyer's prerogative to choose the notaire (who need not be local) but in practice you will find that most sellers want to use their "family notaire". Each party can choose a different one; this will not cost more because the standard fee is split. Again, find out who will pay the fee, because this is high because it is actually a tax - the notaire gets little of it - and is usually at least 10% of the purchase price. The usual practice will be for the buyer to pay, but it may be split or paid by the seller. On top of this the buyer pays stamp duty of a further 10% or so. The French specialise in taxes on taxes!
The initial and final contracts are usually simple. Our notaire spoke no English but was quite happy for us to write to him or fax him in English if we chose, and the contract was a standard form with each clause printed in French and then English. The only complicated bits were appendices on specific rights and responsibilities concerning drainage and access. You can get an English solicitor specialising in French law to deal with all this for you. This will cost you around £1,000 extra, but they will usually advise you on French inhereitance law and inheritance taxes.
Having signed the initial contract and paid over the agreed deposit, you then wait three months for the processes of French law to grind away. The French are naturally averse to paying the (high) property taxes, and get up to all sorts of tricks. If you are buying an appreciable amount of land classed as agricultural (as we did), there is a French quango called SAFER which has a right to buy in the land at the agreed price if it judges it to be substantially undervalued. Getting clearance from them (usually just a formality) is one of the many things the notaire does in the three months. At the completion ceremony (often a major family affair!), the notaire is obliged to ask the parties to confirm that there is "nothing under the table"; he then apparently excuses himself on some pretext to allow any additional undeclared transaction to take place without his knowledge! Be warned that the French tax authorities have some years to submit an additional tax bill to the purchaser if they can prove that the property was sold at an unbelievably low price compared with the local norm.
The books warn that either you need to be present at the completion or you need your signature witnessed by an English Notary Public and certified by the Foreign Office. Legally this is only necessary if the purchaser has a mortgage on the property, although it is said that some notaires are stuffy enough always to insist on this anyway. When we broached the subject, our notaire said that he would be happy if the signatures were simply witnessed by someone in a substantial public position, so we asked the Vicar to do it.Apart from the signed contract, you have to provide the notaire with the money for the balance of the purchase price and the estimated taxes in time for the funds to clear for completion.
You don't get the deeds; the notaire registers your title (and the interests of all your sons and daughters, who are in this way parties to the contract) in the local and district public records. You will usually get a copy of the cadastral plan (the exact plan of your property from those public records) and you are entitled to require an attestation - a certificate that you have bought the property - which you may need for some official reasons, like importing furniture and household goods free of customs dues.
Do find out a bit about French inheritance law and inheritance taxes, because these are quite unlike those in England (or Scotland, or the USA) as far as "immovable property" is concerned.
As far as we were concerned, it all went more or less like clockwork. We had a resident English agent to give us some confidence. These agents, unlike their French counterparts will often offer a range of additional free advisory and support services which can be very useful. However, remember these are usually people you don't know, and they may not prove to be reliable - the reputation that estate agents have is not, regrettably, always undeserved. In particular, do not assume that an extensive presence and lavish claims on the Internet are a measure of substance.
For varous reasons related to French culture, inheritance law, and family relationships, there is always a great deal of French property on the market (especially rural property). Much of this remains unsold for years or decades. Many of these properties are very attractive and are offered at excellent prices. If you visit France, do look in local estate agents windows, as you will see a much wider range than the English agents are able to sift and hold details of.
We bought when prices were at their most depressed, after the recession of the early to mid-1990s and when they were just set to rise because the Pound had risen to over 10 Francs. Even now, there is still a vast amount of property available, often at a fraction of the price in England.
The Dordogne is often said to be hugely expensive because of its popularity with the English, Dutch, and Germans. This is only in the context of those English people who apparently used to pop across the Channel to Normandy and buy a wreck for a few hundred pounds. There are still plenty of properties for less than £5,000 but they will be small, without land, and often shells without services. Understand that substantial renovation or conversion is likely to cost at least as much as in England, and you are likely to spend at least £20,000 to £30,000, often more. Realistically, good properties are likely to be in the range of £40,000 to £140,000.
You will get a grand chateau for anything from £300,000 to £1,000,000, although even chateaux sometimes sell for about £60,000. We did receive details of a two-room lakeside cabin set in a wood with only a quarter of an acre of its own for £10,000 ... surely much nicer than towing a caravan about or spending your holidays in a tent?
La Citadelle - three substantial houses (one of them centrally-heated and ready to live in) with gardens, lake, and 25 acres of woods, totally secluded but within close reach of all amenities, and in what is reckoned to be the most expensive part of France outside of Paris - cost us no more than a good terraced house would in the part of north west England in which we live. We do have to spend half as much again on converting and renovating the two barns, but then what does a barn conversion cost in England?
Property taxes are modest by English standards, electricity is quite expensive, telephone costs are not high. Labour costs tend to have a low base, but carry a high sales tax (TVA). Evasion of TVA is almost the norm, but probably inadvisable.
The local people have a distinctive local accent which makes their speech sound rather different from the French you learnt at school. We have experienced little of the formality which the French are supposed to show. People may introduce themselves by their christian names, and many people seem to be on "tu" terms very quickly.
The people of the region are friendly and hospitable and are quite used to having large numbers of foreign residents and are pleased to have us. Our local bank have their brochures in English, and an English-speaking personal banker, and the water company send out English language leaflets inviting payment by direct debit on your British bank account.
The people of the region recognise that incoming northern Europeans are revitalising the popular parts of rural France. New residents and summer visitors are encouraged to view themselves as an integral part of the community. Even if the locals were xenophobic, they would dislike Parisians more!