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BUYING IN FRANCE

The buying process

• The compromis de vente or sous-seing privé is the first document the buyer will be required to sign. It commits the vendor of the property to sell it to you and it commits you to buying it.

It sets out the main terms of the agreement between the parties, including names, addresses, professions or occupations, the details of the property, the price, and the conditions of the purchase (eg, if it is subject to a mortgage or loan). At this point, the buyer pays a deposit of at least 10% of the net purchase price (5% or less for new-build properties).

Once the compromis is signed by both parties, the property is taken off the market and the buyer has seven days in law during which he can change his mind and withdraw from the deal without penalty. His deposit will be fully refunded. However, if the vendor decides to withdraw, he may be obliged to pay the buyer a similar sum as a penalty. After the seven-day period, the contract is binding on both parties.

Documents you will need when you sign the compromis include your passport, marriage or divorce papers, and details of any loan or mortgage you have taken out to buy the property.

• The date of the signing of the acte de vente or acte authentique, often known as the final signing, is usually arranged when the compromis is signed. It takes into consideration the time needed by the notaire (see notaire guide) to process all the legal information and paperwork needed to authorise the change of ownership of a property. This is usually two to three months.

On the day of the final signing, the cleared balance of the total agreed net purchase price must be in the notaire's account. This is important: failure to transfer the funds in time may lead to the notaire's refusal to sanction the deal. In such a case, the buyer may lose both the property and his deposit.

If it is not possible for the buyer to be in France on the date of signing, he may arrange power of attorney for someone to sign in his absence. Once signed, the acte is the document that proves your ownership of the property.

The notaire

The dictionary defines a notaire as a 'lawyer, notary public', but that is a little vague because his duties are not the same as those of his UK counterpart. Although his role is a legal one, he is not independent; in fact he is appointed by the government, like a judge.

His role is principally to ensure that a property transaction is above-board, and to collect taxes payable to the state. He ensures that the sale is conducted legally, that the title to the property is authentic, and that the contract accurately represents the agreement reached between the vendor and the buyer.

No property sale in France can go ahead without the use of a notaire, and a buyer will need one as soon as you have agreed a price and are ready to sign the compromis de vente.

Although you may not actually meet your notaire at this stage, you should appoint one because he is responsible for drawing up the final deed of sale, the acte de vente. He will also handle the conveyancing process (cession) in the time between the signing of the compromis and the acte de vente, usually between two and three months.

On signing the compromis for your chosen property, your deposit, usually about 10% of the agreed net price (5% or less for new-build properties) is paid to the notaire, who will hold it pending completion. If a mortgage is declined, or other problems are found by the notaire during the conveyancing, the sale should be cancelled, subject to certain conditions, and the deposit returned. However, if a buyer simply changes his mind, the vendor is entitled to keep the deposit.

During the conveyancing, the notaire will verify all the important issues such as the full names of the vendor and the buyer, place and date of birth, and the vendor's legal right to sell the property. He will also check that there are no outstanding mortgages or loans, and that the property is correctly identified on the cadastral plan (similar to a UK local authority's property register).

A certificate of free title (conservation des hypothèques) is obtained from the equivalent of the Land Registry, and a note/certificate d'urbanisme from the local authority, which declares the existing use of the land and any administrative restrictions or requirements that apply.

French purchasing laws vary to some extent within the type of property bought. For example, a vineyard or farm will be subject to different procedures and costs. If a house has more than one hectare of land, there may be intervention by SAFER (Société d'Aménagement Foncier et d'Etablissement Rural), which has an automatic right of pre-emption to preserve land which it feels should remain in agricultural use.

When the conveyancing process is finished, both vendor and purchaser proceed to the acte de vente, or signing the final deed of sale, the contract drawn up by the notaire. The signing takes place in his office, and if the buyer is unable to attend, he may give power of attorney to a friend, relative, or the clerk in the notaire's office to sign on his behalf.

Before the acte is signed, the outstanding balance of payment for the property must have been paid to the notaire (who passes it to the vendor) along with the notaire's fees. The notaire gives the buyer a certificate of sale to prove his ownership when dealing with organisations such as France Telecom, the electricity and gas boards, etc.

From the signing of the contract, the buyer is responsible for insuring the property against third-party claims, and must produce the valid insurance certificate at the final signing. The buyer is also immediately liable for property taxes (d'habitation and foncier).

The notaire's fees are fixed by law and include taxes, registration fees and stamp duty. The transfer tax (stamp duty) is 4.89% of the purchase price for a dwelling. On new properties, VAT of 19.6% is payable, but when VAT is due, the transfer tax is reduced to only 0.6%. An additional stamp duty is paid to the state at a cost of three euros per page of the deed of sale and the notarised copy of it.

The actual fees for the notaire include fixed costs such as requests for identification documents, the cadastral map, zoning and urban planning information, etc. These are calculated in proportion to the purchase price and vary from 0.987% to 5.98% - a smaller percentage for a more expensive property.

When the formalities are concluded, the notaire will send the buyer a deed of title, a statement of costs that will detail the taxes paid to the state, other costs incurred, and the fees received by the notaire's office. The buyer pays the notaire's fees - the vendor pays nothing to sell his property.

There are a number of differences in the French legal process that can be frustrating for British buyers. Firstly, it is not standard practice for the notaire to keep the buyer up to date with the results of the searches. And secondly, although the notaire will check for anything that will directly affect a property, such as a neighbour's right of way across the land, he will not check for those that are nearby. His responsibility is limited to the plot on which the property stands. For example, although he is duty bound to tell you if a planned major road will run through your property, he is not obliged to tell you if it will run across a neighbouring field.

To help smooth the way through the sometimes bewildering purchase process, France Property Bureau can not only advise buyers on the choice of a bilingual notaire, but will take every step to ensure that buyers feel comfortable and stress-free, and confident that their concerns and queries are addressed fully at all times.

A good buy means a good welcome.

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