Despite uncertainties over Brexit, buying property in France remains a popular choice for British expats, whether as a permanent residence, an investment property, or a holiday home. In some regions, property is substantially cheaper than in the UK and British people are still welcome; for instance, the Occitanie area is home to a high proportion of British expats.Buying a new home away from it all can be appealing, but you need to be aware of procedures and pitfalls.
Where To Start
In the UK, the property buying process can remain somewhat mysterious, with your solicitor doing most of the donkey-work. However, if you’re buying in France, it pays to take a rather more hands-on approach to the bureaucracy. Let’s assume you’ve seen a property you like, and you want to make an offer. Check with your estate agent first to see if it’s going for a fair price, as well as what is a fair price for you to offer in return. For example, if you’re buying somewhere that needs a lot of work, it’s not reasonable to expect the seller to drop the cost significantly.
The British Expats website points out that many French vendors are not as used to the buying and selling process as British people, since they are more likely to have inherited their home, so this may be their first sale. Make it clear what your offer includes; are you looking to include furniture or notaire’s (legal specialist) fees? Will you need a survey, and when should that take place? Try to avoid any misunderstandings by being as clear as possible when you make your offer.
Once you’ve agreed a price, you’ll need to sign an initial contract known as a compromis. You’ll need all your personal details, plus details of the property, price, vendor’s details, and the date by which you must complete. There may also be conditional clauses relating to the time limit on your mortgage. If you don’t have a mortgage, you’ll need to put something in writing to signify that you can afford the property outright. Once you’ve signed this and paid your deposit (usually 10 percent), you have a seven to 10 day cooling-off period in which you – but not the vendor – can change your mind. Check whether or not you’ll lose your deposit if that happens, though.
It’s only after you’ve signed this first contract that you can apply for a mortgage. You’ll therefore need a clause in the contract which allows you to pull out if your mortgage application gets turned down. Obviously, non-mortgaged sales are more appealing to vendors, who otherwise have to wait several months before they find out if your application has been successful and if they’ve actually sold their property.
You will need a specialist mortgage broker who has an awareness of exchange rates, just in case the euro takes a hike or a dive between your offer and completion; you can set the rate beforehand. Additionally, there are some issues with buying a place in a rural area; for example, the ‘commune’ may have first refusal. This is unlikely to be taken up, but it can be a necessary formality.
Once this is all settled, you’ll be ready to set a completion date and sign your final contract. However, between the two contracts, your notaire will need to complete local searches and get various reports on the property from the vendor, such as lead, asbestos and termite surveys. On completion, it’s probable that you, your vendor and your agent will all meet. You will need an interpreter if you aren’t fluent in French; this is a complex process and it’s as well to iron out any issues as thoroughly as possible before you go ahead. However, purchasers have noted that, despite language difficulties and different legal procedures, buying a place in France can actually be a lot more straightforward than buying in England – no gazumping takes place, for instance.
How Might Brexit Affect My Purchase?
With March 2019 approaching fast, you’d be wise to do some research on how Brexit might affect your ability to buy abroad. The situation remains up in the air, with the possibility of no-deal potentially affecting a range of issues, from freedom of movement to pet passports and health insurance. If you are a cautious type, it might be as well either to wait and see what happens in the spring – or later if the UK’s exit is postponed. If not, you might want to move as quickly as possible – but remember that the clock is ticking!
One member of the Expats in France Facebook group remarks that she is approaching her purchase as a ‘third country national’, and so is putting in place her Titre de Séjour, Carte Vitale, tax declarations and proof of domicile as well as her evidence of income and no criminal offences. She’s treating herself as a non-EU citizen in advance – it’s good to note that non-EU nationals are perfectly entitled to buy property in France. French Entrée states:
“There are so many traditional stone properties on the market at the moment that France almost relies on the British to buy them. Certainly, there is no reason to believe that France would want to discourage Britons from renovating old houses. There are some three million empty properties in France, compared to 700,000 in the UK, and the French continue to build new properties at an astonishing rate.”
They go on to add:
“As a post-Brexit, non-EU buyer, you will still have access to French euro mortgages, and French banks show every sign that they will want to continue lending to the British. The difference will be that you will have access to only 60-65 percent of the purchase price rather than the current 80 percent available to EU citizens. Local taxes and capital gains tax are the same for EU and non-EU residents.”
There may also be restrictions to renting out your French property if the French change property laws after Brexit. Keep an eye on the situation as it unfolds and do your research if you’re still thinking of buying in France.