Buying new build in France – think of it as not
having to renovate or decorate!
For some people buying a home or holiday house in
France means getting their hands on an old stone
building, a crumbling water mill or perhaps even a
decrepit château. It’s an integral part
of their dream of living or holidaying there. But the
tide is turning - and more and more house hunters are
now seeking out new properties instead.
Here are some of the reasons we think purchasers are
looking for new build or buying off-plan in France.
Real alternative to
renovation
Renovation costs in France can rapidly exceed
one’s budget as far as materials and project
supervision are concerned. In some instances a
renovation project will require planning permission
and the paperwork involved will also add time and
costs to the original budget.
French new build property on the other hand is
priced more or less on the basis of being
‘ready to move into’. This is a major
benefit to the buyer, who will be clear about the
overall cost of the property from the outset.
And let’s face, it also means less work for
the buyer – no months of renovation or
decoration to ‘look forward’ to!
As you may already know, new build has for many
years been the first choice for French buyers - and
new properties for sale in France are usually snapped
up quickly. This is not that surprising given the
many financial - and lifestyle - benefits you enjoy
when buying new build in France.
A
refundable deposit of 5%
When purchasing an off plan property in France,
French law clearly states that the deposit required
for the reservation of the property cannot exceed 5%
of the purchase price. This is a real benefit that
reduces the purchaser’s initial outlay. In the
case of other property transactions the deposit
required is 10%.
And if the time limit for the completion of the sale
(signing of the deeds) exceeds two years the deposit
required is reduced to 2%.
The purchaser’s deposit is also given
considerable legal protection too. The law (it’s article R.261-29 of
the Construction and Dwellings Code) requires the
deposit to be paid into an escrow account (compte
sequestre) where it can’t
be touched by the seller until the sale goes through.
The actual wording is that ‘the sum shall
remain unavailable, non transferable and unattainable
until the signature of the Deed of sale’.
The deposit will be returned to the purchaser,
without any retention or penalty, under terms clearly
laid down in the contract. These include:
- If the purchaser decides to cancel his or her
reservation during the seven day statutory cooling
off period which follows the signing of the French
reservation contract.
- If the mortgage applied for to finance the
purchase is not granted within the stated time for
the mortgage application (usually one month from
signing the French reservation contract) and the
buyer is unable to proceed.
- If, due to an act of the vendor, the sale
agreement is not concluded within the time limit
provided for in the French reservation
contract.
- If any of the items of equipment provided for in
the reservation contract is not completed.
Secure and simple buying
procedure
Buying an off plan property in France is a
straightforward and safe process. All new build
property is subject to French government regulated
contracts designed to protect the interests of the
purchaser.
Low legal costs
(3%-4%)
None of us enjoy paying lawyers, do we? Well, legal
fees on new build property in France are low - and
amount on average to only 3.5% of the purchase price.
This compares very competitively with 6% to 8% for an
old property. The legal fees or frais de Notaire include the French
Notary’s fees and the deed documents
registration fees.
Stage
payments
Other financial advantages in buying a new property
in France include staged payments – these are
made as construction progresses and help spread the
cost of financing the purchase of your new
home.
Excellent letting and resale potential
Off plan properties in France are built on
residential developments that are often gated and set
in landscaped maintained grounds. This provides a
secure, organised environment that’s attractive
to holiday letting agencies. In addition, French off
plan developments are often located close to all
amenities, which is an important requirement from a
holiday point of view.
And if and when the time comes to resell, these key
features help ensure good resale potential and
sustained capital growth.
French lifestyle at the turn of a key
As new build properties require little or no
maintenance you are able to enjoy your place in
France and French lifestyle from the moment you
arrive. At the end of your stay you can lock up and
leave your new home with full peace of mind - and
looking forward to your next visit.
General advice on buying in
France
The key in today’s environment is to be
‘comfortable’ with the purchase. Knowing
that it can be financed is important - i.e. it is
vital to spend time looking at the different
financing options (UK re-mortgage, Euro mortage, cash purchase) before
even going to France to look at properties.
It is always better to view properties with this
side of things already in hand, and an agreement in
principle if a mortgage is to be raised.
Also, any purchaser must be confident about the
location. It must be right for their current needs
and requirements but also for the long term. For
example, will the area have good resale
potential?
Finally, potential buyers should make good use of
the knowledge and expertise UK agents offer. It will
save time - and agents are often in a better position
to answer all their questions in English, overcoming
in this way the potential language barrier.
A Place in France for FrenchEntrée Property
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