Take Heed of These 5 Things When Buying Property in France as a Foreigner

20230526051803_6470410bbe8bc.webp

With delightful sights and enticing cuisine, it's no wonder France is at the top of the list for many tourists. And not only tourists, people who are banking on profiting from these fascinations are snapping up properties fast too. France also boasts collections from masters of both modern and contemporary art.

However, if you're looking to buy a home in France as a foreign investor, don't be distracted by the sights. It's easy to be carried away by the beaches of Riveira, wandering through the battlefields of Normandy or viewing castles along the French countryside. You will need to focus your efforts on getting the deal done right. Let’s consider some stats on French property prices.

Facts about property prices in France

Prices are competitive and mortgage rates are currently low in France, according to Notaires de France. In the past year, over 900,000 properties have changed hands. Even though a surprisingly large number of these properties (90%) were bought by people looking to live in, rather than let. For investors, this means there hasn't been a property bubble and this might just be the right time to buy a house in France. Price is increasing steadily. Notaires de France estimated a year on year increase of 1.2% in property prices by August of this year and a jump of 4% in property prices by the end of the year.

What to know when buying property in France

Although the process of buying property in France is fairly straightforward, here are some things you need to know:

1. You're not required to hire a solicitor. As a general rule, buying property in France must proceed without an advocator or solicitor. It can't be delegated. So you have to travel and spend time and effort on acquiring the property.  Although property buying and land registration in France are secure, you need to have your wits about you.

2. You should learn French. If buying a house in France, you should know French or at least hire a translator. Trying to infer what the other person is saying will only give you a false sense of security. On the other hand, a knowledge of the language will bolster your confidence.

3. The notaire will not verify everything. The notaire may not be able to tell you if the property would give good ROI or what liens are currently on the property. There is room for you to do your own research about the property and about prices in that neighborhood. It's also advisable to get a specialist property lawyer.

4. Estate agents mostly act for the seller. Take care to read through any written offer. Make sure that the content of the offer are subject to a written sales and purchase offer. Also make sure you read through the content of the sales and purchase offer prepared by the agent to ensure equity. As with buying property anywhere, take your time before signing on the dotted line.

5. Local mortgages can be favorable. You might want to consider buying with a French mortgage as mortgages in France are relatively cheap. If you'll be seeking a mortgage, it's important you throw in a conditional clause in the sale contract.

In conclusion, having your own notaire is advisable. Don't expect the notaire working for both seller and buyer to seek your best interest.

 

Previous Post

5 Steps to Successfully Buying Your First Overseas Property

Next Post

4 Questions You Need To Ask Before Buying Luxury Real Estate Abroad

Related Posts

20230526052249_64704229a937e.webp

Tips To Get Mortgage for Your Overseas Property Purchase

  • 26, July 2023

Your overseas property purchase doesn’t need to be stopped by financing. You can apply for a mortgage. However, getting mortgage for foreign property isn’t like getting a mortgage at home. This article considers some ways to tip the balance in your favor.

Why bank financing isn't always available for overseas property

When it is available and comes with no string attached, bank financing is the best option to buy foreign real estate. But alas, it’s not usually available. In many markets, it's hard to get loans as a foreign buyer. In Colombia for example, banks don't care if you're a legal resident, as long as you're a foreign buyer, you're not getting mortgage. It's easy to see why this is so. A foreign buyer isn't tied to the country; he can up and leave at any time, taking the bank's money with him. Banks wouldn't want to take this risk. Hence the hassles of getting mortgage for foreign property. This is one of the things stopping passionate investors from traversing foreign lands.

Resident and non-resident bank financing

So, let's say bank financing is available; it most likely would come in one of the following categorizations:

Ø  Resident financing: Except for countries like Colombia, most local banks would treat your loan application as they would treat that of a citizen if you're a legal resident. You'll have to prove credit worthiness just like any citizen and may not have to go through any other process or requirements. This is called resident financing.

Ø  Non-resident financing on the other hand is difficult to secure. Wherever it is available (countries like France, US, Mexico, Panama, The Dominican Republic, Portugal and New Zealand), it comes with a number of restrictions and requirements. Also, the rate you get may not be favorable, except in France, where it's possible for a non-resident with good credit to access a 20-year mortgage at a rate of just 2.25 percent.

Tips To Get Mortgage When Buying Foreign Property

So, here are some tips to help you secure mortgage when buying foreign real estate

1. Don't go it alone.

Even professional property investors get professional assistance when buying foreign property; this could be through experienced local agents or friends. They understand that investing overseas is a much different ball game. If you're in the UK, you can seek the help of an agent selling property overseas through the following bodies:

  1. The Association of International Property Professionals (AIPP) and
  2. The National Association of Estate Agents International

2. Find a bank that has a presence in your country and the country in which you want to buy a property.

According to Glenn Carter, a Canadian investor who works for Condo Capital "The problem is a foreign credit score does not count for anything, it's just like having no credit score”. This means the interest rates you’ll be quoted will be that of someone with no credit. But a bank with presence in your home country will offer favorable rates. "The interest rate I was quoted from a US Bank was 9%, versus the 3% we got from a Canadian bank with branches in the US.” Carter says.

3. Get an Agreement in Principle

Before signing any contracts or paying deposit, get an Agreement in Principle. Learn more about Agreements in Principle. If you're planning on getting finance on the house, make sure this is explained in the contract, and seek an 'opt-out clause' if the loan is not agreed. This will ensure any first deposit paid is refunded.

 

 

 

By Bebuzee Admin Read More
20230526051321_64703ff1b5737.webp

5 Easy Home Design Ideas to Make Over a Room

  • 02, September 2023

What goes on in your head when moving into a new home? Foremost, how do I turn this empty shell of a house into an inviting home that reflects my own personal style? You don't want a bland and boring house. Your new house offers a new start. You can eliminate the junk and put in new digs; you can buy that bed you've always dreamed about; or beef up the kitchen and dining area for maximum comfort and entertainment. The great thing about home decoration is that you have the chance to improve your home's appearance without spending much money. Let's look at some home design ideas for giving each room in your house a makeover.

 

When giving a home a facelift, sometimes simple solutions can have a big impact. Here are some inexpensive home design ideas to give rooms a new lease of life.

 

1. Don't rush. You need to take a little time before starting major decor projects in your new home. Take some time to let in the feel and observe what the home needs before buying major stuff. HGTV recommends staying in the house for two months before making significant purchases. You might be spending money on the wrong areas. For example, instead of spending $5,000 on revamping and putting new features in your bathrooms, you might find out that you could spend half the price to get your bathroom in great shape.

 

2. Add color to walls. For people who get out early, a light shade will do while a deep tone will make the house more homely for those who spend more time indoors. You can also make a statement with a feature wall. Adding a lick of paint to your walls is an inexpensive way to give your room an instant lift. Whether you decorate your entire room in an intense shade or opt for a stylish two-toned plan, fresh color on your walls guarantee oodles of glamor.

 

3. Pare down. Now it's time to reassess and evaluate what works and what doesn't. Don't pack everything from your old home over. You don't really need everything you've accumulated. They will only make rooms stuffy. Having a new house gives you chance to try out a fresh approach. This means you can pare down on tired pieces that will only clutter up your space. You can sell these items off on eBay or drop them off at a charity shop.

 

4. Use right lighting. Transform the mood of rooms at a cheap price with the right lighting. You can also invest in dimmers to switch from bright to low lighting. When decorating bathrooms, try out stylish lights. For bedrooms, buy a fresh shade for lamps. You can give your room a cohesive style with stylish lighting.

 

5. Update roller blinds. Whether you go for a subtle floral pattern or statement stripes, roller blinds for your windows are great low-cost, high impact options for designing rooms. They can transform your dull windows and complement other designs in your room.

Less is often more when decorating and less is also eco-friendly. No matter how small your space, you can always let your creativity shine through.

 

By Bebuzee Admin Read More
20230526052356_6470426c09f6f.webp

5 Additional Costs to Budget For When Buying Property Overseas

  • 08, July 2023

Knowing the extra costs and preparing ahead will help reduce the stress of overseas property investing. Much of this boils down to targeted research. However, here is a brief overview of the extra costs you have to face.

Buying property overseas is both an exciting and a frightening prospect. The most frightening aspect is the cost. Most buyers are delving into relatively uncharted lands personally and knowledge-wise, hence they don't really have a 100% certainty about price. There are extra costs lurking here and there and the chief is foreign taxes. Foreign taxes represent the largest share of extra cost for foreign property buyers. It is important to get the advice of a property specialist on property taxes in your destination country. The key to successfully investing in foreign housing is knowing how to budget for extra costs. Putting money down for these extra costs will put you at ease and the remaining specs will come together smoothly.

Additional Costs To Budget For When Buying property overseas

Extra costs can be overwhelming and have the capacity to snuff the life out of your foreign property venture. Preparing ahead is your best bet. You will need to budget for the cost of travelling back and forth, annual carrying costs and in some cases, stamp duty when the property is eventually sold. And combining these costs can add up to 15% of the home's market value. In many cases, additional costs on foreign property investing will fall into these categories:

1. Mortgage Arrangement fees.

Your bank or private lender will charge a fee for arranging funds for your mortgage. These fees will vary according to your mortgage. In some cases, they will be added to your mortgage. You don't want this (so ask upfront). In which case, you will have to pay interest on that amount.

2. Property Purchase Taxes.

·         VAT (Value Added Tax): Property owners fail to take this into account. But it is mandatory in many countries. The VAT is similar to a sales tax for property owners in the United States or the goods and services tax that Canadian property owners have to pay.

·         Stamp Duty fee (on new properties in some countries) fluctuates relying upon the locale the property is in. It is calculated as the percentage of the price tag which varies but is normally in the range of 0.5% and 1.5% of the price.

·         Miscellaneous: In Spain, for instance, when purchasing a property from a private owner, Transfer Tax (ITP, Impuesto sobre Transmisiones Patrimoniales) is paid rather than VAT. The ITP rate differs from place to place, but is in the range of 6% and 10% of the purchase price. In Quebec, there is something called a welcome tax, It usually costs about 1 to 1.5% of the underlying price tag, although the cost generally depends upon the value of the property.

3. Legal fees.

Legal fees also vary from country to country. It is common for Spanish lawyers to calculate their commission for the purchase of a property based on a percentage of the purchase price of the property (generally this is 1%, subject to a minimum fee of around € 1000).

4. Notary fees and Land Registry.

These rates will also depend on the purchase price and the complexity of legal documentation. You can expect to pay around € 750 for land registration fees and € 1,000 for notary expenses.

5. Maintenance.

Beyond the issue of foreign taxes, homeowners should also plan the cost of hiring a property manager to oversee the maintenance problems and concerns of renters, especially if they plan to rent the property year-round.

By investigating all the costs associated with foreign owned property, potential buyers can focus on enjoying their home abroad without having an unexpected blow to their pockets. If a buyer does their research and saves upfront, they can eliminate stress and prevent extra costs from adding up.

 

By Bebuzee Admin Read More