The prices must take into account the age and condition of the contents and the total amount should not be over 2 to 5% of the value of the property. Bear in mind that the prices should be reasonable or else you may be liable for a tax audit.
There is a fiscal advantage of having a list of furniture added to the selling price in the Title Deed made by the Notaire. This is because the prices of the contents are not included for calculating the Notaire’s fees due by the buyer.
What can be added to the list?
– movable furniture, that is, any furniture which is not a structural part of the property and which can be removed, even if it means light work like blocking holes on the walls.
– electric radiators, if they are just screwed and do not damage the wall if removed
– garden furniture
On the other hand, the following are considered as part and parcel of the property as their removal could physically or aesthetically damage the property if removed:
– sanitary fittings
– mirrors which cannot be removed
– shutters, if they cannot be removed without spoiling the wall
– fitted shelves and wardrobes
PRIVATE SEPTIC TANK SYSTEM
The private septic tank system, or in French the “assainissement autonome”, needs to be inspected prior to a sale. You would therefore have to contact your governing authority (eg. SPANC) and fix an appointment. Do contact them in advance as they are very busy. They will check your system and send you a report of their findings which is payable. If your system is not to the norms and an update or a new system is required, be warned that the purchaser could offer a lower price to offset the cost.
After a number of visits, you have finally found an interested buyer. Agencies often require a written letter from the interested buyer stating his offer. If the price is not suitable, you could suggest a higher price. The property agent’s job here is to negotiate the price between you and the buyer.
PRE-SALES AGREEMENT OR THE “COMPROMIS DE VENTE”
When an agreement has been reached, the property agent or the Notary prepares a pre-sales agreement, known as the “compromis de vente”, mentioning your personal details, details about the property, the selling price, the agency’s fees and all the conditional terms and conditions of the sale, including a 10% (or less upon mutual agreement) deposit of the purchase price.
The usual conditional conditions that would delay the conclusion of the sale are the obtention of the following documents:
– mortage/bank loan if the buyer requires financing for all or for a portion of the purchase.
– pre-operational planning certificate or planning permission for your renovation or building project.
– relinquishment of pre-emptive rights from the related authorities if your property is within the perimeter of a historical monument, in the centre of town, in an agricultural zone etc.
This is an important document as it sets the terms and conditions for finalising the sale.
For more information on the pre-sales agreement and the cooling off period, please refer to my previous newsletter Guide to buying a property in France.
TITLE DEED (ACTE DE VENTE)
When all the contractual conditions and documents have been obtained, the sale shall be finalised at the Notary’s office where the Title Deed will be signed by both parties in principle. This used to be the normal procedure until Covid restrictions were enforced. It is now quite common for a Notary to prepare a proxy / power of attorney (“procuration” in French) to buy or to sell (depending on the concerned party). By signing it, you would give him and/or his clerks the authority to sign on your behalf, as well as to undertake all the required formalities leading to the sale.
The power of attorney is generally a summarised version of the Title Deed. However, it is highly recommended to obtain a draft copy of the Title Deed so as to be fully aware of all the terms and conditions.
Do note that if you are not fluent in French, the Notaire would normally ask for an English translation of the Power of Attorney and both documents (in French and in English) would have to be signed and certified. I am a qualified translator and have been working for Notaires for over 17 years. If you are in France, the Mayor of your town or your Notaire can certify your identities and signatures.
If you are not in France, you would need to sign the French and the English documents in the presence of a UK Notary Public or Solicitor before it is sent to the appropriate authority for the “apostille”. It is a form of authentication accepted by all countries that are members of the Hague Convention of 1961 for cross border transactions.
CAPITAL GAINS TAX (“Impôt sur les plus values”)
This tax is due if you are selling your secondary residence/ holiday home and the percentage is calculated on the number of years you have owned the property. The Notaire will calculate the tax based on the profit made (purchase price minus selling price minus any construction or renovation bills less than 10 years). You will have to sign the form during the signing of the Title Deed after which the Notaire shall submit it to your tax centre. For non-residents the tax centre is located in the Parisian region (Noisy Le Grand).
When all the registration formalities have been completed and the Title Deed signed by the Land Registry, the Notary shall send you a copy. On the other hand, if you have lost a copy, you could always ask the Notary for one as he is obliged to keep a copy for 75 years.