Is Now the Right Time to Sell Your Property in France?
The French property market, once a hotbed for investors, has entered a period of adjustment. While the past few years were marked by strong growth, a slowdown began in late 2023 and continued into 2024. This translates to fewer property transactions and, in some areas, declining prices.
A Market in Flux
Several factors are contributing to this shift. One major reason is the increased difficulty of securing a mortgage in France, with interest rates nearly doubling recently. This has dampened buyer enthusiasm and reduced their purchasing power.
However, the impact isn’t uniform across the country. While major cities like Paris experienced price drops of up to 3% in the last quarter of 2024, others like Nantes, Lyon, Marseille, Strasbourg, and Bordeaux defied the trend and saw price increases.
Location, Location, Location
Ultimately, the decision to sell hinges on your property’s location. Areas with strong fundamentals and ongoing demand are likely to weather the slowdown better than those with weaker economic prospects.
Considering a Sale? A Step-by-Step Guide
If you’ve decided to move forward with selling your French property, here’s a comprehensive roadmap to navigate the process:
- Finding an Agent or Going Solo:
While it’s not mandatory, using a real estate agent (agent immobilier) offers valuable advantages. Their local knowledge and expertise can streamline the process, especially if you don’t reside in France. They handle viewings, negotiations, and other key tasks. Agent fees can be steep (typically 6-10% of the sale price), so weigh the convenience against the cost.
Alternatively, you can sell privately using online listing sites like Esalesinternational.com, Leboncoin.fr, Seloger.com, Logic-immo.com, Bienici.com, and Pap.fr. However, you’ll shoulder the responsibility for marketing and attracting buyers.
- Compulsory Property Surveys:
French law mandates a series of property inspections known as the Dossier de Diagnostic Technique (DDT). These surveys cover lead and asbestos, gas and electrical installations, septic tanks (if applicable), energy efficiency, termite presence, and potential natural or industrial risks. Ensure all relevant DDT tests are completed before putting your property on the market.
- Marketing Your Property:
Once armed with the DDT reports, it’s time to showcase your property. If you’re working with an agent, leverage their marketing expertise. Private sellers should actively list on popular real estate websites and online platforms.
- Appointing a Notary:
The notary (notaire) plays a crucial role in French property transactions. They act as a legal intermediary, ensuring all paperwork and procedures comply with regulations.
While the notary typically serves both buyer and seller, you can choose to engage a separate property solicitor for additional guidance. Be prepared, as notaries might primarily speak French, necessitating a translator or English-speaking solicitor.
- Compromis de Vente:
Upon accepting a buyer’s offer, the notary drafts a purchase agreement (Compromis de Vente). This agreement formalizes the sale and outlines the terms.
- Deposit Payment:
The buyer pays a deposit (usually around 10% of the sale price) upon signing the contracts. This deposit is held by the notary until the sale is finalized.
- Seller Disclosures:
French law requires sellers to disclose any hidden defects, easements, restrictions, existing tenancies, licenses, and planning consents associated with the property.
- Acte de Vente:
The final act of the sale involves signing the Acte de Vente (final purchase document) at the notary’s office. Once all parties sign, you relinquish the keys and legal ownership of the property. The notary then facilitates the transfer of the remaining sale funds to you.
Timeline and Costs
Selling a property in France can be lengthy due to administrative requirements. Expect the timeframe to reach completion (signing the Acte de Vente) to be around 3-4 months, excluding the time it takes to find a buyer.
Financial Considerations
Selling a property in France incurs various fees and taxes. Here’s a breakdown of the key expenses:
- Estate Agent Commission: If you use an agent, expect a commission of 6-10% of the sale price, although negotiation is possible. In some cases, the buyer may cover this fee.
- DDT Costs: As the seller, you’re responsible for booking and paying for the mandatory diagnostic tests.
- Notaire Fees: While traditionally paid by the buyer (unless otherwise agreed), notary fees typically range from 6-8% of the sale price.
- Capital Gains Tax: Selling a property in France
