French Property Insider Volume XVII, Issue 4 Thursday, January 24, 2019 • Paris, France
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REDUCED TO SELL!
Studio Apartment Fully Furnished, 28.55m2 (307 sq. ft.) Third Floor with Lift
36 rue de Buci, Paris 6th Arrondissement
Located in the heart of Saint-Germain-des-Prés, where rue de Buci meets with boulevard Saint-Germain and rue de l’Echaudé, the apartment is in the perfect location on the third floor (with elevator) of an old building completely restored to modernity. It has two large windows overlooking the quiet rue de l’Echaudé.
Completely renovated in 2009, there is a bathroom with combined tub with a rainfall shower, sink and toilet. The kitchen has a refrigerator, two-burner ceramic stove, full sized oven, microwave and several other small appliances and is well equipped with dishes and glassware as well as utensils and cooking implements. The main area has a king-sized bed which can be converted to twins and surrounding the head of the bed is built in cabinetry. Included is an entertainment center with flat-screen TV and DVD player, a comfortable sofa and a table for two with plush Louis XV chairs.
The apartment is sold with all of the furnishings valued at 7,500€.
Transportation is abundant – with two Métro lines: Mabillon #10, Odeon and Saint-Germain-des-Prés #4 and #10; and numerous buses: #63, #70, #86, #87
Ranking of Property Buyers in France by Nationality
Property Buyers in France by Nationality
According to a new report by the Chambre de Notaires, 5.4% of all property purchases in France in 2017 were made by foreign buyers. The trend of the first half of 2018 is already showing a slight increase to 5.9%, but that increase is attributed mostly to transactions in the Île-de-France. Of these figures, 1.6% of the purchases were made by non-residents (0.7% in Île-de-France and 1.8% in the provinces).
British buyers decreased sharply between 2016 (33%) and 2017 (26%), likely due to the Brexit referendum creating uncertainty with buyers. Even so, they account for most of the buyers, and had been in first place for at least the last 10 years. The German buyers who were in 11th position in 2007 have moved up each year, surpassing the Italians in 2017.
Purchasing habits differ greatly among the different nationalities. During 2007 to 2017, 75% of the Scandinavians didn't reside in France at the time of the transactions, compared with 50% of the Italians and only 6% of the Spanish or Portuguese. The Italians almost buy exclusively apartments (92%) and mostly studios, with 90% of their purchases made in urban areas. The Dutch, British and Belgians are more likely to buy houses (six rooms or more) and half of their purchases are made in rural areas. Americans account for 53% of the buyers.
Paris experienced bigger price increases than London or New York with prices having multiplied by 3.9 over 19 years compared to 3.6 in London and 2.1 in New York. Paris also has much less difference in property value within its different districts compared to London or New York. These statistics make Paris a better investment than both counterpart cities.
Here's some valuable advice the Chambre de Notaires de France has for foreign property investors (source: notaires.fr/):
Before investing in property in France, foreign nationals should contact a professional to find out what conditions apply to their plans. The notaire will advise them before they commit and ensure that their investment is safe.The notaire will first consider the nationality of the buyer, his country of residence, his personal situation (if he has lived in France for example) and his matrimonial regime, if married.
French law will apply, as the governing law regarding real estate matters is the law of the country where the property is located. The consequences on the purchase are therefore of higher importance as regards the ownership of the property, the tax system or its future sale.
Note however that in the case of death of the purchaser, the purchaser can escape from French law. Since August 17, 2015 (effective date of the European Regulation of July 4, 2012), it is not the law of the location of the property that applies to inheritance, but that of the country of residence of the purchaser. So what determines who inherits the property and fixing the amount of the taxes and fees to be paid falls under special rules (bilateral agreements, the Hague Convention, etc.) that apply to people from EU member states as well as nationals of countries that have signed special agreements with France.
Nothing prevents the foreign buyer from forming a company to acquire the property (Société Civile Immobilière or SCI). Once again, the legal and tax rules applicable to the property will depend on the chosen status/scheme.
Buying property in France will sometimes involve transferring considerable amounts of money. Such transfers are checked by intermediaries such as banks and financial houses.French notaires also check the origin of funds to combat money laundering. They may have to make certain formal notifications if they have reasonable doubts regarding the origin of the money used (TRACFIN - Traitement du Renseignement et Action Contre Les Circuits Financiers Clandestins - Intelligence Analysis and Action against Illicit Financial Channels).
French notaires also have to secure the transactions, for which they are liable to the foreign buyer and the seller. Once again they will check any transfers of money they receive and the integrity of the banks handling them.
Foreign buyers also need to be aware of the taxes payable on property bought in France: the cost and the various taxes and fees. They also need information about the taxes payable depending on whether the property is to be used as a main residence or has been bought to let and generate revenue.
The taxes payable once the property has been bought or is sold, often depend on choices made at the time of purchase (V.A.T., capital gains tax, use of an accredited representative, etc.). Once again, very different rules apply ranging from total exemption to heavy taxation. Foreign buyers should consult a notaire to examine all these factors.
Note from FPI: We offer consultation to answer most of your questions well in advance of purchasing a property and contacting a notaire. Learn more by completing our online consultation form.
P.S. We have been promoting the re-airing of three of our House Hunting International episodes, based on their schedule. It came to our attention this week that they have changed the schedule without notifying us. So unfortunately, "Last Hurrah in Paris" will not be airing Janury, 25th. You may unset your DVRs.
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