A French Property Q and A
If you read yesterday’s Parler Paris Nouvellettre®, then you already know that Monday night’s Webinar, “Finding and Financing Your French Property” with Kim Bingham of Private-Rate and myself, managed to gather over 400 registrations!
We were not really surprised by the numbers because we could sense the pent up frustrations by those who have the urge to make the move to France or invest in a property here. We couldn’t answer all of the questions during the Webinar and in yesterday’s Parler Paris, I addressed a few of them related specifically to immigration and taxation. Today is my chance to answer some of the questions raised about renting or purchasing property.
Meanwhile, here are just a few questions from the Webinar that we can easily answer:
* We had planned to be in Paris June 2020 to search for a rental property. That is obviously not going to happen. Is it realistic to believe a relocation will be possible by the end of 2020?
Yes. We are already searching for rental properties for other clients, who are already here. The moment you can enter France, and have a visa, we can secure a rental apartment for you.
* Who secures the Notaire? Buyer or seller?
We recommend that the buyer and seller each have their own Notaire to represent them separately. However, if we represent the buyer, then it doesn’t matter to us if the seller uses our Notaire! They share in their fees.
* How is rental market during pandemic in Nice?
There has been no market during the confinement period, for rental or for purchase. The inability to visit properties put the market at a standstill. Now that confinement is lifted, with restrictions, the markets are opening up again.
* Is it a buyer’s market now in Nice due to Covid-19 or in general?
Each market differs, but I do believe that AT THIS VERY MOMENT, the best bargains can be had. As deconfinement opens the market, demand will increase, inventory will decrease and prices will go up.
* Why would Paris [or France] not move to the MLS system to make the process easier on buyers and sellers? Or is that just not how France does business?
This was my favorite question of all. Many people have tried to install an MLS and failed. There is now and MLS in Nice, but it’s not really the same universal marketplace like it is in the U.S. It’s more an effort that has succeeded to a large degree in one small area of the country. The French, culturally, do not see the benefits of sharing the information openly, like the U.S. free enterprise system views it. I don’t believe it will ever be possible, but I’d love to be wrong.
* What are best practices to manage a renovation from a distance?
Hire a qualified designer/contractor who understands how to manage a project for a non-resident owner. We recommend Martine di Matteo in Paris and Laura Poirier in Nice. Be sure to let them know I referred you, otherwise, they may not be open to taking on your project out of loyalty to us!
* Do you have a French/English vocabulary list for buying/selling?
* If I have found a property and would like to make an offer, is it as simple as sending the offer to the agency via email?
It can be. It can be as easy as putting your offer on a napkin, but we don’t recommend that. It’s best to submit an offer in writing (English or French) to the agent or seller so that the seller must respond within a given amount of time and ensure that you have their acceptance in writing for proof should the seller try to renege and take another offer.
* Do you have very many senior clients over 70?
Of course! I’m not far from 70 years old and still don’t consider myself a senior citizen! There is still a lot of life to be had and you might as well enjoy every minute of it.
* If you purchase a second home and don’t want to rent it out, is it safe to leave it empty for months at a time?
Yes, but we recommend you have a “concierge” manage it and visit it periodically.
* Do you have a presence in Normandy?
Not a physical presence, but we can do business anywhere in France.
* What is the minimum lease for renting a property in Paris?
- Short Term/Vacation Rental = one night to one month
- Mobility Lease = one month to 10 months, for business or education
- Furnished Long-Term = one year lease
- Unfurnished Long-Term = three year lease
In Paris, one can cancel any lease with a 30-day notice. In other parts of the country, the 30-day notice applies to furnished rentals and a 90-day notice applies to unfurnished rentals.
* In the news media, it is reported many are leaving Paris for less crowded areas in the country. Are you seeing an increase in the number of properties for sale?
No one has moved as confinement hasn’t allowed anyone to move! And there has been no market. But, there is speculation that the French will see the suburbs in a different light. Plus, being in the countryside was safer and more pleasant than being in the city, and the cost of property is lower. On the other side of the coin, when there are transportation strikes, living in the suburbs and having to commute to the city can be a nightmare. All this is purely speculation for the time being.
* Is there an age limit for buying homes if paying cash?
* Can you tell us again why you recommend buying vs. renting a property?
Simple. Why pay someone else’s mortgage when you can pay your own and make an investment that will secure your future…not to mention living in your own home to which you can do whatever you want!? There are also reasons that relate to timing — you want to take the mortgage at an opportune moment — when the bank sees you as a low risk borrower, when interest rates are low and the rate of exchange is favorable. Taking the time to rent first before buying could eliminate that opportune moment.
* What is the minimum lease for renting a property in Paris?
There is very little property for rent under 1,000€ a month in Paris.
* “Diagnostics by seller replaces inspection” – What recourse is available and at what point in the process does the buyer have to protect himself against a hidden defect in the property?
If a hidden defect is discovered in the course of the purchase, then it can be dealt with prior to the purchase. If discovered after the purchase is finalized, then unfortunately the only recourse is a lawsuit.
* I’ve read that the buyer pays for the seller’s real estate agent’s fees.
The mandate between the seller and his agency dictates whether the fees are paid by the buyer or the seller. The fees are built into the purchase price. If the buyer pays them, then the price of the property is reduced on the deed by that amount and that lowers the notarial tax and fee basis, so it’s a savings to the buyer, but then the fees cannot be mortgaged. If the seller pays the fees, then the gross selling price is on the deed, the notarial taxes and fees are based on the higher amount, but the fees can then be mortgaged.
* Would you recommend buying a rental in anticipation of Paris hosting the Olympics in 2024?
Yes. In every case with the Olympic cities, they have seen their property prices increase up until the Olympic Games take place. What we could never have anticipated, however, was Covid-19 and the affect it has had on such major events.
* Can you purchase property as a Trust Account?
No. France does not recognize trusts.
* Do you ever have Americans selling their homes in France in dollars?
No, it’s not possible. All transactions take place in France in euro value.
* How can I get an inspection and an official valuation of a property?
Inspections are not normally done, but can be done if necessary. We can perform an official evaluation.
We hope that the Webinar was helpful to all who attended! As a result of the Webinar, we decided to offer seven Intimate Group Consultations this summer with me on Zoom under the title of “Planning Your Future in France after Coronavirus.” The groups will consist of no more than five and no less than three individuals and the topics are specific. Perhaps you’ll find at least one that suits you.
They are already filling up fast, so do not delay. Otherwise, you may also choose to do an individual consultation with me to address your specific needs. For more information, email [email protected].
Adrian Leeds Group