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French
laws regarding buying property can vary slightly depending on the
type of property you buy.
Capital Gains tax is chargeable on second home sales owned for less than two
years. This would be charged at 33% with reductions on the profit percentages
for each additional year of ownership up to 20 years plus.
There are no restrictions on foreign ownership.
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Real
Estate Prices in France
Range
Varies, for example:
From £30,000 / $45,000 for rural homes in need of some renovation
From £50,000 / $75,000 for apartments
From £70,000 / $125,000 for suburban homes
Ski resorts come at a premium with apartments costing upwards of £100,000
/ $180,000 and chalets over £200,000 / $365,000.
Locations
to buy real estate in France
France
occupies a large area and has many appealing districts.
Brittany in the North, French Riviera in the South, Paris for cosmopolitan
enthusiasts and of course the French Alp ski resorts like fashionable Courcheval,
which can also be quite lovely in the summer.
Living
Costs in France
The
standard of living in France is high with good salaries. Cost of living
in Frances capital, Paris, is considerably higher with premium property
prices, so a larger income is needed if you were live there. On average,
the cost of living in France is lower than the E.U average, particularly
in rural areas.
Buying
real estate in France
For
a regular freehold residential property.
An agreement to buy is negotiated between the buyer and seller and an initial
contract is drawn up by the Real Estate Agent or a Notary and signed by the
buyer and seller which legally binds both parties.
You would now pay a deposit of about 10% of the purchase price which remains
held in a special account by the Notary or selling agent until completion of
the sale when the property will no longer be open to offers from other parties.
This contract is known as a bilateral agreement, compromis de vente in French,
and the most popular type of contract. You would lose the deposit if you do
not proceed with the purchase.
The final contract is signed at the Notary’s office and the deeds pass to the
buyer and the land registered. You must then pay the balance of the purchase
price to the Notary who will then pay the vendor. You will also need to provide
the Notary a copy of your birth certificate translated into French and, if
applicable, a copy of a Marriage Certificate, also translated.
Solicitor / Lawyer
A
solicitor/lawyer is recommended to protect your interests and conveyance
the property title when buying real estate in France. They will be
in addition to the Notary who is mandatory for property transactions.
Fees
You
would expect to pay a total of over 12% of the selling price; less
for properties under five years which have VAT (20.6%) built into the
price.
The Notary fee would be around 3%, transfer tax 7.5% (less than 1% for new
properties) and registration fees around another 6%.
The vendor should pay the Real Estate Agents fees.
Property
Tax in France
Real
Estate taxes are levied on property plus residential tax for living
as a owner occupier or as a tenant (renting or not). Both are calculated
on the average property rental values.
*In
France new property purchases attract Vat of 19.6%, but this can be
avoided through the leaseback scheme. Leaseback restricts the number
of weeks per year that the buyer can use their property, so that it
can be rented out as holiday accommodation. Popular in ski resorts
and coastal areas with developers quoting an average of 5-6% gross
annual rental income. In some cases the buying price you are quoted
is with the tax already recovered by the contractor. Leaseback Property
Mortgages
You
can borrow up to 80% from French banks and should be declared at the
time of the preliminary agreement. The normal repayment term is 15
years. Click
here to arrange a mortgage in France.
For more information on buying property in France, please contact the Real
Estate Agent or visit the French Governments website:
www.info-europe.fr
Our guide will not cover all the legal and full financial information
for your Real Estate purchase but should enable you to get an idea
into the financial involvement.
For more information
on French Property and to arrange your viewing visit:
French
Property Viewing Arrangements
French
Property Search:
French
Property Search
Alps
Property Bordeaux
Property Brittany
Property Corsica
Property
Cote
d Azur Property Dordogne
Property Languedoc
Property Loire
Property
Normandy
Property Paris
Property Provence
Property Pyrenees
Property
Andorra
Property
French
Embassy
58, Knightsbridge
London
SW1X 7JT
Tel: +44 (0)207 201 1000
Fax: +44 (0)207 201 1004
Email: press@ambafrance.org.uk
Web: www.ambafrance.org.uk
10 East 74th Street
Fifth et Madison Ave
New York NY 10021
Tel: (212) 606 36 94/95/96
Email: info@franceconsulatny.org
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