Whether you have always dreamed of retiring to an elegant French chateau, would like a Parisian weekend apartment or wish to relocate with your family to the warmth of Marseille in the south, purchasing a property in an overseas location can be complex.
It’s essential you understand the process, your rights, the costs of legal services and the ongoing outgoings associated with running and owning a property – whether a second home, permanent residence or holiday let.
The homeownership rate in France is higher than in the UK, with almost 65% of all residents owning their properties, so the market is well-established and regulated. However, getting to grips with the variations and nuances will make the buying process considerably easier.
General Guidance on Buying a Property in France
The French property market offers a breadth of choice, from chic penthouses and apartments with typical balconies and facades to rustic rural properties, charming farmhouses set among the lavender fields and ultra-modern duplexes and villas along the coast.
Your first step is to think about the region or city you’d like to live in and narrow it down. There is a significant difference between the budget you might require for a period property in a central arrondissement in Paris and a comfortable family property further out.
Most foreign buyers work with a local estate agent or agent immobilier to view properties. This support will ensure they know all the pertinent details about the area, including travel times, local schools, amenities and facilities such as communal areas, public transport connections, shopping districts, and parking arrangements.
- Once you have chosen a residence to submit an offer against, it’s important to review the Dossier de Diagnostic Technique or DDT report – similar to an initial survey in the UK. This report provides information about the structural condition of the property and any major work required.
- Buyers normally make a verbal offer and enter into an initial contract called a compromise de vente, where the seller confirms they are happy to accept. It is worth noting that this preliminary contract is a legally binding agreement, so it’s important to be sure you wish to proceed before signing.
- Next, you pay a deposit worth around 5% to 10% of the total price and instruct your notary to conduct searches against aspects such as ownership rights, property boundaries and land registry details.
- Provided everything is satisfactory, you, as the seller, attend a meeting at your notary’s office and sign the final deed of sale, called the acte de vente, and are then ready to proceed with the exchange of keys.
There are contrasts to the UK property sales process, where the buyer has a legal right to receive an updated DDT report. These surveys look at the possibility of asbestos and insect infestations through to the property’s energy performance.
Any international buyer should ensure they have received the DDT and analysed it thoroughly before entering into a confirmed purchase agreement. However, a DDT is not the same as a full structural survey as you might expect in the UK – this is an additional and separate report you will normally be advised to commission and pay for yourself.
The Costs of Homeownership in France – Including Property Tax
French property values are fairly similar to those in the UK, with the average price of a city centre apartment €5,777 (£4,986) per square metre compared to £4,524 in the UK. However, much also depends on where you’d like to buy, with variations between regions and, of course, high-demand cities and more rural areas.
As an indication, those averages for central properties look somewhat different in some of the most popular regions:
- Bordeaux: €4,955 (£4,245) per square metre
- Grenoble: €3,275 (£2,806) per square metre
- Lyon: €5,560 (£4,763) per square metre
- Marseille: €5,193 (£4,449) per square metre
- Nice: €6,188 (£5,301) per square metre
- Paris: €12,178 (£10,432) per square metre
- Toulouse: €4,325 (£3,705) per square metre
Aside from the agreed property purchase price of your French property, you will need to account for Droit de Mutation (stamp duty), which is levied at 5.8% for all properties sold that are over five years old. New property developments attract a stamp duty charge of 0.7% plus VAT.
In some cases, the sale price might be designated TTC or toutes tax comprises, which means all the taxes are included in the total cost.
Notary fees are between 2.5% and 5% and are charged on a scale overseen by the French government and depending on the transaction value.
Going forward, you should also know what your property taxes and land tax obligations may be, including the taxe d’habitation charge, a municipal local tax, and taxe foncière, or land tax – both are paid annually.
The taxe d’habitation was reformed in 2023 and is now only payable on second homes, while the municipal taxes, equivalent to council tax, are always payable and are based on a percentage set by the local municipality with an average of 1% for a primary residence and 3% for a second home against the annual rental value.
Requirements for Expatriates Buying a French Property
There are no specific limitations on foreign nationals or non-EU citizens wishing to purchase a home in France. Still, the law does contain several factors that buyers should be aware of. For example, the French government imposes caps on the housing market, where fees are limited to 10% of the property value.
Buyers with an acte de vente sales agreement also have the right to pass their property to living dependents – something you may wish to factor into succession and estate planning.
It may be beneficial to learn a good level of French before entering into a property purchase agreement or hiring an estate agent who will gladly translate on your behalf.
If you are buying a French residential property as a non-resident, you are permitted to stay in France up to 90 days per 180 per the current EU immigration rules. You would need to apply for a residency permit through a relevant long-stay visa route to stay longer or more frequently.
UK nationals who live in France for five years through a temporary or short-stay visa can apply for permanent residency, although spouses of French citizens can apply after three years.
We hope this guide gives you an idea about the process of buying a property in France, what it is likely to cost and the ongoing taxes you should budget for. If you would like further information or support with financial advice for moving to France or your investment plans, don’t hesitate to contact our local Chase Buchanan Wealth Management team in Bordeaux for more tailored guidance.
*Information correct as at January 2024