Buying a Property in France

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1 Buying a Property in France in partnership with

2 Buying A Property in France Key Currency Buying A Property in France France - it s the country that has it all A great climate, glamourous cities, iconic landmarks, ancient villages, unspoilt countryside, wonderful food and wine, beautiful beaches, world-class ski resorts and an abundance of art, history and culture. It s no wonder that around 85 million people visit France every year making it the most visited country in the world. Of course, France also remains a popular place for Brits looking to buy property. It s less crowded than the UK, has more reliable weather and is conveniently just a hop, skip and a jump across the Channel. Perhaps best of all, property prices are generally a lot cheaper than the UK. In this guide, we take a look at what France has to offer, how to find your dream property and some of the things you need to consider before buying. 01

3 5 things to love about France 1 The climate France is a great all-rounder. It has lovely, warm summers, mild springs and autumns and hey, in the winter you get to ski. 2 The food and wine France has long been considered the world s gastronomic capital. The country has a passion for food and drink, whether it be local wines, champagnes and cognacs, artisan breads and cheeses or simply cooking at home with fresh, seasonal ingredients. 3 The landscape France is a great place to explore. You can just drive around for hours and discover amazing places. The landscape is dotted with chateaux, churches, vineyards, medieval villages, mountains, meandering rivers and rolling countryside. 4 The language The staff at Clé France have a bilingual team. French is such a beautiful language it has a smooth sophistication to it. Just about anything sounds better in French, it turns something as basic as cream of mint into créme de menthe. 5 The quality of life The French seem to get what life s all about. They work less, eat better, sleep more and live longer than Brits. Damn them. 7 bizarre facts about the French Fact 1: Napoleon wasn t actually short. He was incorrectly depicted as 5 feet 2 inches when in fact, he was 5 feet 6 inches, the average height of a man in that period. Fact 2: The average person in France sleeps 8.83 hours per day, the most in the developed world. Fact 3: 80% of French people who take a holiday actually stay in France. No one loves France as much as the French. Fact 4: In France you can marry a dead person. This unusual law first came about during Wold War I, when some women were permitted to marry their fiancé after he was killed in battle. The law is still practiced today. Fact 5: The name France comes from a tribe called the Franks, who migrated from northern Europe into Gaul. The Franks developed the concept of the knight and the feudal system. Fact 6: French was the official language of England for over 300 years. After William of Normandy took the throne in 1066, the Normans changed the official language from English to French, but only the upper class actually spoke it. Everyday folk still spoke English. Fact 7: Scientists still can t explain the French paradox. This is the country that brought us quiche, foie gras and potato dauphinoise. They eat more cheese than any other country on earth and seem to add butter and cream to everything they cook. And yet despite their love of saturated fats they have very low rates of obesity and heart disease and one of the longest life expectancies in the EU. 02

4 Where to buy in France? Choosing your ideal location in France will depend upon personal factors, but to help narrow your search, it s worth knowing where the most sought after places are. While France is a large and diverse country, the British tend to congregate in certain parts of the country and not in others. Paris is obviously a very popular spot with tourists, but less so with British property buyers. Properties in Paris are relatively expensive and mostly small apartments, which will not suit a lot of buyers. Another tourist hotspot is the South of France; where you experience style and sophistication by the sea. It has some beautiful towns and has long been renowned as a playground for the rich and famous. It has more of an international feel than other parts of France and property is priced at a premium. If you would rather the real France, then there are plenty of other stunning regions such as Normandy, Limousin and Poitou-Charentes there s just one pretty little town after another. You can throw a dart at a map and discover a gem in these areas. Other very popular places for Brits are the Languedoc region and the Dordogne, in the South West region of Aquitaine. Many Brits say the Dordogne reminds them of home. It could be the medieval castles, forests, valleys and long, winding rivers or just that it s a lot greener than the South of France. also good value. And last but not least, you have the Rhône Alps region, located in the South East, which includes many of the country s glitzy ski resorts such as Courchevel, Meribel and Val d Isère. Once you ve got a clearer idea of what you re looking for and where, a good place to start your search is on the internet. The internet is a quick and convenient way to get a feel for prices in a particular area and the style of properties available. But I m sure I don t have to tell you there s no substitute for getting on the ground and viewing the real thing. You just can t get a true feel for a property or an area on the internet. Time to head to France. All estate agents with Clé France are local, many of them are family run businesses, born and bred in the areas they represent. They are qualified people who are happy to help you through the buying or selling process in France. Don t forget, you also have the full support of the UK based bilingual team at Clé France on hand. In the North West, Brittany, Normandy and the Loire Valley also attract plenty of British buyers. They may not be as warm as the south of France, but these regions offer peace and quiet, plenty of old world charm, and you re not far from Paris either. Property prices are 03

5 Buying A Property in France Key Currency Location checklist : 1. Why do you want to buy in France? Somewhere to retire, go on holidays, have family stay, investment returns? 2. What kind of property should you go for? Coastal apartment, family villa, rustic farmhouse? 3. How close do you want to be to the sea, an airport, a city or an expat community? 4. What amenities are most important to you? Cafés, restaurants, bars, supermarket, doctor, hospital, parks, public transport? 5. Does your partner want the same thing as you? 6. What is your budget? 7. Will you re-mortgage in the UK or get a foreign currency mortgage? 8. Will you rent out your property some of the year to help pay the bills? 9. What is the climate in the location I m looking at? 10. Do you need easy access to the UK? 04

6 Brexit & French Property While Brexit has brought uncertainties, in terms of property investment, it is our view that France will continue to be a popular destination for British buyers. Here s why: France has a great climate and way of life. Those things will continue to appeal to Brits regardless of Brexit. Proximity matters. France is next door to the UK. Getting there is cheap, easy and quick. While Brexit has weakened the Pound, French property remains good value relative to the UK. You still get a lot more for your money. France welcomes foreign property buyers whether they are part of the EU or not. For example, the Swiss and Russians have been big buyers of French property in the last few years. Neither country is part of the EU. Being part of the EU is not the be all and end all. Tens of thousands of Brits have bought properties in Florida and Turkey for example. It didn t matter that they weren t part of the EU. Ultimately, things like the weather, quality of life, proximity and affordability are bigger considerations and France ticks all the boxes. As a result of Brexit, things like reciprocal healthcare and pension agreements will need to be sorted out. While it will take time, it s not ground breaking. Non-EU members such as Norway, Iceland and Switzerland have already paved the way for the UK in these areas. In our view, Britain will find a way forward as it s in everyone s interests to do so. In terms of the property market, demand may be subdued in some areas in the shortterm, but this could be a good opportunity to buy. With fewer buyers around, there s less competition and more scope to negotiate on price. One thing to note is that post-brexit, the exchange rate is expected to remain volatile. However, buyers can take steps to insulate themselves from currency risk. We strongly recommend that you speak to a dealer at Key Currency, who will take the time to understand your situation and ensure you get the best deal on your currency needs. 05

7 Top Tips for finding your dream home 3 Where comes before What : France is huge and varied; narrow down your geographical search area before viewing specific properties. 3 Use a property professional: a good agent can save you time and money. 3 Be clear what it is you wish to find: budget, proximity to services and neighbours, outside space, work you are prepared to do (or not!) Make sure your agent is properly briefed. 3 View more than one property during a visit! It s the only way to get an idea of local prices. 3 Have your finances in place to avoid disappointment later. 3 Don t forget to allow for notaire fees (in France the norm is to list prices including agency fees with notaire fees to be added). 3 Don t try and do it all yourself - put together an expert team. 3 Get an independent survey done for peace of mind. 3 Don t forget the costs of buying and ongoing maintenance. 3 Beware currency swings 06

8 The notary will calculate what fees and taxes you need to pay and collects the deposit from you. Fees are typically in the region of 7% to 10%, but vary based on the price of the property and whether it is new or old. Buying your property Once you ve found a property you re interested in, it s time to make it happen. The process of buying a property in France is well-regulated and like the UK, takes place in two-stages. After you ve had a verbal offer accepted, the first stage is essentially like exchange. It consists of a contract known as the Compromis de Vente. Once this is signed by both sides, the buyer is given a 10-day cooling off period. During this time, the buyer can pull-out of the sale without incurring a penalty, but the seller cannot. At the end of the cooling-off period, the buyer pays the 10% deposit and the contract becomes legally binding for both parties. The second stage is a completion or closing contract, known as Acte de Vente. Once this final document is signed, you re officially the owner of the property and get handed the keys. One of the main differences between France and the UK is the use of the notaries. A notary is a legally trained public official and acts on behalf of both the buyer and the seller. It is their job to ensure that property transactions are carried out correctly. The notary s actual fee is regulated by the government and comes to around 1% of the sale price (it s calculated using a sliding scale based on the property value). When you complete your property purchase you must sign the deeds before the notary and pay the remaining balance. In the lead up to this, it s worth getting in touch with us at Key Currency, to make sure you have the funds in place, ready for the big day. Putting together your expert team You don t have to be a property expert to buy a property in France. Just like buying a property in the UK, the hard work is largely done by the experts around you. It s important to have people on your side who can help you understand how everything operates. Top of the list is appointing a good independent lawyer. It s the best protection you can give yourself against things going wrong. While a notary is a lawyer, they act for both sides. Whereas if you appoint your own lawyer, they will act solely in your interest. Lawyers might add an extra layer of cost and can be annoyingly meticulous, but they re paid to spot the things you won t. There s a good chance you re not fluent in French or experienced in local law, so it s worth paying for someone that s both, and speaks good English too. 07

9 In France the seller does however, have to provide a number of statutory survey reports. It s a pretty long list and covers things like asbestos, lead, electrics, energy efficiency, septic tanks, termites, swimming pool safety and smoke alarms. If you want peace of mind, there are Chartered Surveyors working in France that can perform a UK-style building survey, looking at things like the roof, walls and drainage. If you re looking to buy an old farmhouse for example, things like damp and subsidence can be costly to fix. It s worth having an expert take a look. Three Common Property Pitfalls Of the thousands of people who buy a property abroad every year, the vast majority have no major issues. However, problems arise when purchasers don t do their homework or try and cut corners. Here s some of the common pitfalls to avoid. 1. Buying without an independent lawyer Strangely a lot of people seem to think instructing a lawyer may not be necessary or that you should just use the seller s lawyer even if you are told everybody does it this way over here. It s impossible to act in the best interest of two parties who want different things. Don t confuse a notary with a lawyer. A notary is required to buy a property in many European countries and in many respects, seems to be doing the same job as a lawyer. But a notary generally acts on behalf of both the buyer and seller. Clé France recommend Matthew Cameron from Ashton KCJ Legal services. This is for those clients that require further legal advice or have a specific legal question when buying or selling a property in France. 2. Underestimating ongoing costs You want to enjoy your property abroad. However, ongoing costs are easy to underestimate. If there s a shared pool, gardens or an attached golf course, they will come at a cost. Some communal properties also charge a management fee. There will also be local taxes, insurance and mortgage payments to consider. Costs will vary depending on individual factors. Maintenance costs are typically lower on apartments than villas. And things are more likely to go wrong on older properties than new builds, but that depends on the quality of the builder! Ongoing costs shouldn t put you off, they just need to be factored into your budgeting. 3. Buying properties unseen We all love a bargain but if it sounds too good to be true well, you know the rest. Before you sign any contracts, make sure you personally inspect the property and have professionals check it over too. Indeed, the first contract states that the buyer has seen the property. Beware any agents who are prepared to accept an offer from you before you have viewed. The next step You still need an independent lawyer who works solely in your interests. 08

10 Currency and costs At some point you will need to pay for your property in Euro s, whether that be paying a deposit or the full amount. There can be large savings to be made by getting the right exchange rate on your purchase. Even small movements in the rate of exchange can have a major impact on the amount that you actually pay for your property. If you are making a large transfer for a property purchase, getting a favourable rate could save you thousands, enough to pay for your first holiday to your new home or even stretch your budget into a higher price range. Currency specialist, Key Currency, have a team of qualified dealers who can give you expert guidance, secure a favourable exchange rate for you and answer any questions you might have. Bank-beating rates Key Currency offers bank-beating rates, which means more money in your pocket. Rates are indicative as they depend on time of day, size of transaction and your bank s pricing matrix. GBP/EUR Any Questions? Call us on +44 (0) or visit Bureau de change High-street Bank Key Currency 09

11 Fix a rate Exchange rates fluctuate every day. This could dramatically affect the price of your property and even take it beyond your budget. Key Currency can help you lock-in a rate to avoid currency swings. This can minimise your risk and your stress level. You can lock in a rate for yourself up to a year in advance, allowing you to know exactly how much the property is going to cost you from the start and you won t suddenly face a bigger bill if currency markets move against you. This obviously helps with budgeting and planning. Regular Payments Even after you ve made your purchase, you may still need to make regular payments such as salaries, pensions and monthly bills. And if you are funding your purchase with a mortgage you need to consider what currency to make your repayments in. Key Currency can remove the hassle and worry of making regular transfers. There are a number of products that Key Currency can offer you. Spot contracts easy on the spot transfers if you want to receive your currency quickly and efficiently. Forward contracts allows you to buy or sell your currency in the future, at a rate you fix today. Forward contracts can help protect against adverse currency movements and can be used to lock into favourable exchange rates. Limit orders If there s a specific rate you want, the currency can be automatically bought when the rate hits your target level. Why you shouldn t just use your bank 1. It s not their area of expertise 2. Their exchange rates are uncompetitive 3. Banks charge transfer fees 4. They won t help you with timing 5. You are not their priority 10

12 We hope you ve found this guide useful and that you re in a better position to find your dream property in France. We always encourage you to speak to us well in advance of buying a property abroad to ensure you get the full benefit of bilingual support network combined with our in-depth knowledge of the buying process. Get in touch Call us on +44 (0) or visit support@keycurrency.co.uk Call us on +44 (0) or visit info@clefrance.co.uk Get a Quote Today This guide should not be considered investment advice. You should seek professional advice at every stage when buying abroad. Exchange rate movements could affect your budget. Key Currency Limited is authorised and regulated by the Financial Conduct Authority as an Authorised Payment Institution (Financial Services Register No ). Using a currency broker to convert your money into foreign currency to pay for your property could save you 000s. To speak to one of our friendly team, please call from Monday to Friday between 8.30am and 5.30pm.