Notaire’s Fees Explained
Volume XXI, Issue 8
The acquisition costs of real estate in France are essentially composed of taxes paid to the State, yet, they are often referred to as “Notaire’s fees.”
All of these costs are not intended to benefit the Notaires. They have the responsibility of collecting the tax portion on behalf of the State and are then required to remit these costs to the Public Treasury. The total of the fees include the remuneration of the notary, disbursements and transfer rights. But most of the costs are transfer taxes (or registration fees).
The total cost of a property purchase is about 7-8% of the purchase price of a resale property, while it is about 2-3% for new-build properties. The final amount of the costs depends on the nature of the property, inclusion of the sale of the furniture and the location of the property. They are paid to the State or the local communities, as the case may be. Transfer taxes are made up of municipal tax, the departmental tax, as well as the tax collected for the State.
These costs and disbursements are used to remunerate the different stakeholders in charge of producing the documents necessary for the change of ownership (Registrar of Mortgages, registration of mortgage guarantees, costs of the sale’s publication, town planning documents, extract from the Land Register, land surveyor expert, trustee, etc.). Some exceptional costs incurred at the request of the client, such as travel expenses, should also be taken into account.
The notarial fees are highly regulated. New mechanisms have been implemented by the Decree of the 26th of February, 2016 on tariffs of certain professions of law, establishing the regulated tariffs of Notaries. The consequence is that in parallel to the increase of the registration fees described above, the tariff of Notaries saw a decrease of its rates to 1.33% for immovable properties’ acts of sale (Article A444-91 of the Code of Commerce), 1.45% for the acts of loan, etc.
The over-the-counter sale or assignment (number 54 of Table 5) gives rise to a proportional emolument, according to the following scale:
Example for a sale at €200,000:
Comment: Those are brackets so the calculation is done successively, bracket by bracket.
Note 1: “The sum of the emoluments received by the notaire for the performance relating to the transfer of property or a property legislation may not exceed 10% of the value of said property or legislation” but cannot be below a threshold of €90.00. (Article R444-9 of the Code of Commerce in its regulatory section). This threshold essentially concerns the real estate transactions of low amounts, such as lands or properties located in rural areas, or common portions, cellars and parking spaces in urban environments. Obviously, this threshold does not concern taxes generated by the operation.
Calculate your real estate purchase costs
You can estimate your costs for buying a house or apartment with this online simulator (in French). The following is an example of the fees associated with the purchase of a 1 million euro apartment in Paris:
The bottom line: expect additional taxes and fees of 7-8% of the net price of the property (after deductions of furnishings and other non-taxable acquisitions) that cannot be mortgaged and are paid at the point of closing of the sale.
Source of this information is from the official France notaire’s website.
The Adrian Leeds Group®
P.S. I will not be writing my usual Nouvellettres® the week I will be traveling to Los Angeles and Maui from February 26 to March 6th. Instead, you will have the pleasure of reading some of our most special past issues. Upon my return, you’ll have a full report of time spent on the other side of the planet…to include whale watching, snorkeling, hiking in the rainforest and volcanic craters, and a host of other activities France doesn’t offer, but Hawaii does!