Negotiating the purchase price is interesting. The vendors often won’t reduce the price. The estate agents don’t want the price reduced as it cuts into their profits. Once an offer has been accepted the property is taken off the market. It will disappear from the estate agent’s listings.
The French estate agents have a bigger responsibility that their UK counterparts. UK agents basically introduce the purchaser to the vendor, act as an intermediary for any price negotiations and chase solicitors. French agents also draw up the Compromis de Vente (purchase agreement). They will also hold a deposit payable on signing the Compromis de Vente. The deposit is about 15%, usually rounded down to the nearest €10,000.
The agent will require information for drawing up the contract. They need proof of identity and information about any mortgage. This will include the mortgage amount, the lending bank, the interest rate and the term. Remember that French banks are very regionalised. Credit Agricole isn’t sufficient to name the bank. It needs to be qualified by region – Credit Agricole Normandie.
As mentioned previously, there are blue and red zones. After the floods of the late 1990s, areas of land in danger of flooding from the sea or river have been designated as red zones. It is forbidden to build anything on a red zone. Red zone land is worthless.
As we are buying part of an existing plot of land it is necessary for the land to be officially divided into separate plots ensuring that we get the 1350m2 we want. The Cadestre is the French equivalent of the UK Land Registry. Their Web site is quite good and you can get information on plots of land. Apparently the boundary will be marked out by pegs and it is an offence to move pegs until boundary walls or fences are in place. The land needs to be divided before the Compromis de Vente is signed.
Another important consideration is how the property is owned. It is important to get this right otherwise French inheritance laws can prove very expensive. One option is to create a special company called a Société civile immobilière (SCI) which owns the property. It is worth getting the SCI option written into the Compromis de Vente as this gives the Notaire the option of transferring ownership to an SCI on completion.
One very important thing is never sign anything than estate agent gives you, other than a Bon de Visite, without talking to a lawyer. An English speaking lawyer if you are not a fluent French speaker. We engaged Annie Digby from Guellec Digby & Co. She produced a very comprehensive list of things she would do as part of the purchase process, some of which we hadn’t thought of.