Walking back from the farmer’s market, breeze swaying through the trees and cooling down the sun’s rays, your muscles flex with the shopping bags full of artisanal tapenade and saucisson, a juicy melon, and chèvre cheese made just up the mountain. You can’t wait to enjoy these treats on your terrace looking over rolling hills of vines. You marvel that you are finally in fact living your French dream…
If you are considering buying a piece of France to make your dream life come true, you’re just in time!
Why is now a good time to buy?
The housing market in France has been on a steep and steady rise since 2015. In the 12-month period up to February 2017, 867,000 existing homes sold. Housing prices had fallen for four consecutive years but increased 1.3% on the whole in 2016. The surge in activity is mainly due to the historically low interest rates. The average fixed rate mortgage (without insurance) was 5% in 2008 and is currently around 1.5%…but rates have already started to increase since April. Foreigners can obtain mortgages and buy property in France without restrictions. If you’re buying in France with foreign currency, the exchange rates have been stable over the past year for GBP, USD, AUS, and CAN, and the USD has been particularly strong against the euro since 2015. For these three reasons, the time is ripe to buy in France.
If you want your property to appreciate in value, choose a location that’s accessible to travel infrastructure, has a thriving economy, and a pleasant climate. While it’s fine to choose an old stone house in a village halfway up the mountain, if you love DIY and want lots of peace and quiet, you may end up selling it for the price you paid. If you view your purchase as an investment, and are considering renting it out for part of the year, it’s critical that you buy in a place where people want to be. Montpellier was just classed as the third best city in France for real estate investment . With Nîmes and Toulouse also in the top 10, the Occitanie region is the most promising in the country.
Can Renestance help me with house-hunting in France?
Purchasing property is always a big deal, even in your home country – there are many decisions to make, and you want to get them right to avoid costly mistakes. In a foreign country, the unknowns and opportunities for missteps increase significantly, even more if you don’t speak the language fluently. This is why it’s important to hire a bilingual professional who has your back. As a licensed real estate agency in France, Renestance can act as your dedicated house-hunter to advise and support you throughout your purchase.
What does my dream home look like?
The first elements you need to get clear in your mind are: objective, budget, location, basic criteria, and strong preferences/deal-breakers.
- The perfect property will depend on your objective for it – do you plan to live there year-round, is it a holiday home, will it be a seasonal rental, or is it an investment/tax credit?
- Next, you’ll have to determine how much you want to spend. The price will reflect the agency selling fees, but you’ll need to include the closing costs of 7-10% of the purchase price, which banks very rarely finance.
- The first two points will have an impact on the location – if you want to rent it out in the high-season, but have a budget under €200K, we’ll look for a studio in a historic part of town rather than a beach front condo. If you want to live there year-round, there will be other factors to determine your ideal location.
- Apartment, house or chateau? How many bedrooms do you need? How many bathrooms (don’t expect as many as in US homes!)? Do you want outdoor space?
- Do you dream of a modern design with a view of the cityscape? Or rather a 19th century building with exposed stone walls? Is a pool or a garage essential?
What do I need to know about buying property in France?
Purchasing and owning property in France is likely quite different from what you’re used to.
- There is no Multi-Listing Service in France, so the agents are working for the seller in 99% of the cases. If you want to visit a property sold professionally, you must go through the agent who has the sales mandate. While there can be pleasant surprises, these professionals are notorious for being difficult. In fact, 68% of French people have a negative impression of real estate agents, the worst score of all professions.
- While you might find English-speaking agents and notaires, all of the contracts, diagnostics and financing information are written in French.
- Structural surveys are not typically done prior to sale. There are many other diagnostics done (up to 10 depending on the property) on the presence of health and safety risks that the seller must obtain. If the buyers want to have a structural survey done, it would be at their cost.
- The offer is not binding, even if accepted by the seller, but the Compromis de Vente is legally binding 10 days after signing.
- As the pre-contract Compromis is signed generally 3-4 months before the final Acte de Vente transferring ownership, that means 1) the sale is binding much earlier in the process than in other countries, and 2) the overall process takes longer.
- I mentioned the high closing costs earlier, but mandatory life insurance tied to the mortgage may also surprise foreign buyers. Not only can it add as much as 25% to the cost of the mortgage, but you can even see your loan refused if you’re deemed uninsurable. On the other hand, this insurance also makes it more interesting to finance your purchase than pay cash, since it pays off the loan balance should you pass away.
How can a licensed house-hunter help me?
For these and many other important differences that come into play, your best bet is to hire a licensed house-hunter (chasseur immobilier), to guide you through the buying process. Only a handful of licensed French agents are ‘chasseurs’ but more and more are joining the ranks as their value becomes acknowledged. Benefits include:
- Your agent works for you, not the seller, and has your interests at heart. They will take considerable time upfront to understand your personal situation, goals and criteria for your dream home.
- You can feel confident that you understand the essential information, explained in English. This is key to sidestepping mistakes that could cost you time and money.
- Your licensed agent is bilingual and trained in negotiation so has a better chance of reaching a lower buying price with the seller.
- You save time, because you’ll know the process and timelines and will only visit properties with real ‘dream home’ potential.
- Your time on the ground is optimized with a Renestance Regional Reconnaissance trip, if you haven’t yet decided on where to buy in France.
- You benefit from support and coaching on the entire move/lifestyle change, not just advice on the property. As you know by now, Renestance has a team of re-nesting experts to help you settle in comfortably.
- You’ll enjoy exceptional customer service – pay nothing until finalizing the purchase, and the support continues after you get the keys.
What does the process look like when you hire Renestance to be your house-hunter?
- You start by filling out a questionnaire on your situation and criteria, and we meet to discuss in detail.
- When you decide to hire us, you sign a search mandate (mandat de recherche) giving us the legal right to act as your intermediary.
- Your cost for our service is between 0-4% of the purchase price, depending on whether the selling agent agrees to an inter-agency arrangement.
- We begin searching for your dream home, both on- and off-market using all of the resources at our disposal.
- We send you links to all of the properties that match your criteria. From there you derive a short list of places you’d like us to visit, with or without you. If we visit on your behalf, we send you photos and/or videos of the entire property and a written report.
- You physically visit an even shorter list of homes and decide if one is your dream property.
- We discuss making an offer on your dream home, gather all the supporting information, and contact the seller. If you decide not to make an offer, we restart the search.
- Renestance negotiates the best possible price with the seller.
- If the seller accepts the offer, you’ll sign a Compromis de Vente, which we’ll walk you through. You’ll pay a 5-10% deposit upon signing this legally binding pre-contract, which provides a 10 day cooling off period.
- Renestance will guide you through obtaining financing and insurance, setting up the currency transfer and other key tasks prior to the final signing.
- Approximately 3-4 months after the Compromis, you’ll sign the final Acte de Vente, transferring ownership to you. You’ll pick up the keys to your dream home!
- Renestance support continues with ten hours of settling in assistance for whatever you need. We can help you: hook up utilities, arrange renovation work, coordinate property management, receive shipments, buy furniture, etc.
If you are considering purchasing property in the Languedoc region of France, hire Renestance as your dedicated house-hunting expert. If it’s another corner of France that you’re dreaming about, we are available to offer consulting and guidance. Please let us know if we can help you in this exciting project!