Today I am taking my own advice. This afternoon, I will be in our Notaire’s office, in the same shoes as our clients, sitting opposite the seller of a studio apartment on rue Charlot, to sign what is called a “Promesse de Vente” or “Promise to Sell” contract. This is the first formal procedure of purchasing a property in France, also at times referred to as the “Compromis de Vente.” The second and final formal procedure is known as the “Acte de Vente.”
I know the building well — several of my close colleagues live there and own rental apartments they keep happily filled with vacationers. This little apartment is a mere 18 square meters (about 200 square feet), but has three windows along the length of the apartment and southeast facing affording a lot of light, overlooking the courtyard making it quiet and tranquil. Like most Marais apartments, there is no lift, but it’s only on the third floor and the stairwell is very pleasant. An apartment of this size equates to a good-sized hotel room, but unlike a hotel, for the same price per night or more, will be equipped with a full kitchen, washer/dryer and luxurious bath, not to mention all the amenities such as Cable TV, high-speed Internet and international telephone.
Once again, I’ve lucked out to have found this through “inside sources,” and although I pay my source a finder’s fee, the price is less than the average per square meter in this district. On top of that, the mortgage offering is very advantageous, as I’ve been able to qualify for a particular type of loan that pays 110% of the purchase price, meaning that even the taxes and Notaire fees will be covered, so I’ll have no out-of-pocket expense. The idea is that if I only cover the mortgage and expenses, which will amount to about 1000 euros a month (very rough guesstimate), the property will appreciate (the current rate is 15.9%, as reported by the Chambre de Notaires for 3rd quarter 2004 to 3rd quarter 2005) allowing it to grow in value all by itself.
Yolanda Robins, FPI’s Property Manager, will attend the signing with me, treating me like the client and watching out for the pitfalls. You’d think I could manage this on my own, given how many signings I’ve attended and performed the same function…but it’s always valuable to have another pair of eyes and ears, particularly her keen ones and during such important transactions where there are many pitfalls we can’t always foresee.
Lots of folks believe that purchasing property in France is something they can do themselves without the help of professionals…and they can, of course…but mistakes can be costly. Recently, we’ve had several requests to evaluate or appraise a property that someone is considering purchasing or will soon sign the Promesse de Vente. If a buyer isn’t well versed on the current market valuations, it would be normal to question the true value of the property they’ve agreed to purchase. Thanks to the French government protecting consumers by allowing for a 7-day buyer’s remorse period, a buyer can cancel the purchase with no repercussions within 7 days of signing. This is also when we might get called in to make an evaluation on the last minute.
Just this past month, a couple opted out of purchasing an apartment in Paris based on the evaluation, once they saw that while the apartment itself seemed fine, the homeowner’s association and standard of the building was way under par. If they had purchased this apartment, they would likely have found themselves with years of problems, potentially added expense and low appreciation.
Within three months, I’ll be reporting on the signing of the “Acte de Vente” when I can take possession and start the renovation process. Meanwhile, I dream of decorating it in “Provençal” style — bright sunny colors, fancy mosaic tile work, and I hope to expose some of the 18th-century stone now hidden by plaster and the ancient wood beams under the current ceiling. The goal — to make it so delightful to stay in that it stays booked with happy vacationers 80% of the year!
A la prochaine…
Editor, Parler Paris
Email [email protected]
P.S. To learn all about the ins and outs of property ownership for yourself, don’t miss one of the upcoming Living and Investing in France Conferences in Paris and New Orleans! Visit /frenchproperty/conference/index.html for details.
P.P.S. You don’t have to miss out of Parler Paris Après Midi even if you didn’t join us! Read all about yesterday’s gathering at /parlerparis/apresmidi.html and then plan on coming next month: Tuesday, March 14th from 3 to 5 p.m. at La Pierre du Marais.