There are two types of costs involved in buying a house in France; those that apply to the purchase of the house itself, and then the costs of owning and using the property.
The house purchase costs are ‘once only’ costs but it essential that you allow for these so that you are not short of money to complete. The costs of owning and using the property can be calculated approximately and these costs can often be covered by renting out the properties for just short periods.
House Purchase in France – Agents Commission
When buying new, off-plan properties, the commission is included in the price of the property unless clearly stated, and your agent in France or the
UK will receive this direct from the developer. Where agents in both countries are involved, they will share this commission.
When purchasing resale properties you should confirm whether the price quoted includes the agency commission. You should then confirm your offer including agency commission.
In fact, when the purchase contract is written (compromis de vente) it may say that you, as the purchaser, will be paying this commission. This is not a problem as long as the total amount of the purchase, i.e. commission and cost of the property, adds up to the amount you have agreed to pay.
This is often arranged so that you will not have to pay notaire’s fees and taxes on the amount of the commission, so saving you a little money, rather than any attempt to increase the overall house price.
Buying a House in France – Commission Rates
Agency commission in France is normally between 5 – 8%, and sometimes higher on smaller properties and plots of land, but as stated above, this will not be an extra cost to you. There should not be any extra costs charged by the agency and the percentage commission that they charge should be clearly displayed in their offices. Agency commission in France is normally between 5 – 10%, and sometimes higher on smaller properties and plots of land where there may be a minimum charge, but as stated above, this will not be an extra cost to you.
What will it Cost to Use Latitudes?
Should you be working through a UK agency such as Latitudes to help you buy your home in France, they will be sharing the commission received between their associate agencies in France, and Latitudes already have a fixed agreement with these agencies. This means that it costs you nothing extra to use Latitudes to help you find and buy a house in France. Neither the UK nor the French agency should be charging any further amounts for their services, over and above the standard commission. It is not ethical to take commission from both parties to the contract.
Buying Houses in France - Legal Fees and Taxes Applicable
You will then have the notaire’s fees and taxes to pay on your house purchase. When buying a new property you will only be paying notaire’s fees of 2.5 – 3.5%.
On resale you will be paying the same notaire’s fees plus tax, (similar to UK stamp Duty) will vary according to the price of the property but ranges from 4 – 6%. If you are taking a mortgage you will have extra notaire’s fees of around 1 – 1.5% (hypotheque) which is a cost to register the charge on your property for the bank.
French Mortgages
If you are buying with a mortgage, then you will have to pay a small fee to the bank or broker for setting up the mortgage for you. You may ask the notaire any questions you may have regarding ownership of the property which might vary according to the set-up of your family and this advice will not be charged extra for.
Should you wish to take further legal advice, then I would suggest you make sure that you use a qualified solicitor who is also qualified in law in France so that he or she can advise you correctly from the point of view of the UK and France tax and legal systems so that there is no conflict of interest. There are a few in the UK.
Currency Exchanges for French Property Purchases
You should also consider the financial aspects of your purchase. If you are buying for cash then you will need to send the money to the notaire in France in Euros. Bearing in mind the fluctuations in the exchange rate, it is a good idea to deal with a currency exchange company. Some of them will fix a future rate for you. When you agree your purchase price in Euros you will of course translated into sterling to know whether you can afford it and I would suggest that you immediately buy your euros at that rate or fix a future rate
so that you don’t end up paying more than you expected when you buy your Euros.
The currency companies are in watching the market all the time and therefore are in a good position to be able to advise as to the most likely best time to purchase Euros. The companies that we recommend make no transfer charges. It is definitely worth comparing their rates and charges with your bank.
The currency companies can organise regular transfers to your French bank account for mortgage repayments.
Buying a House in France | Buying Houses in France | Costs |
