A Comprehensive Guide for Buying a House in France

With its rich culture, stunning landscapes, and delectable cuisine, France continues to be a top choice for Brits seeking a holiday haven or a serene retirement destination. However, buying a property in France involves navigating a complex process with specific rules and costs. To make sure your journey through the French property market is stress-free, it’s essential to have a comprehensive budget in place that accounts for all expenses. 

In this article, we’ll explore the steps and costs involved in purchasing a house in France, from scouting trips to taxes and fees. 

Scouting Trip: Discovering Your Dream Property 

Before diving into the world of French real estate, you’ll want to test the waters with a scouting trip. This allows you to explore the diverse range of properties available and which area suits your needs. From rustic retreats in wine country to vibrant urban centres and scenic ski resorts, France offers many choices for potential homeowners. 

At this stage, we recommend starting to think about the impact of foreign exchange. Exchange rates are constantly fluctuating. This means that when you decide to buy a property abroad, the real-term cost of your purchase can change with the rates. Imagine getting to the point of buying your dream property, and the price is different from when you made the offer. That’s the reality of the foreign exchange market – small changes make BIG differences when you exchange a large amount of money. 

The Costs: Budgeting for Your French Property 

Whether you seek a holiday home or a permanent residence, understanding the process and costs is crucial. And while investing in a holiday home in France can be an appealing prospect, it comes with its share of expenses. So, when planning to buy a house in France, including all these costs in your budget is imperative. 

Some key financial considerations include: 

Currency Exchange Costs: Fluctuating exchange rates and transfer fees can significantly impact the property’s final price. High street banks can charge up to £30 for each overseas transaction, which can add up quickly when combined with legal fees, taxes, and maintenance expenses. 

There is also a lot of variance in the market, which means that the exchange rate you get from one provider can be significantly different to one you might get from another. This can be between 4 and 5%, meaning choosing the wrong provider could wipe thousands of pounds from your budget. 

By using a specialist foreign exchange service like Moneycorp, you get access to a range of currency tools that can help you to fix the rate for up to two years with a forward contract or target your preferred rate with a Market Order if you’re optimistic about where the market is heading. Moneycorp can also source the most competitive rates from its panel of 16 liquidity providers. 

Mortgage Considerations: Like UK mortgages, French mortgages are available with both fixed and variable rates. Fixed rates have historically been the preferred choice for holiday home buyers, as well as variable mortgages with capped monthly payments, which offer flexibility by allowing the mortgage duration to increase if interest rates surge. 

Having a mortgage in principle in place is a valuable asset when you start viewing properties, as well as a French bank account – which can help prove your financial capability. 

Taxes and Fees: What do you need to know? 

Navigating the French tax and fee landscape can be challenging if you’re unfamiliar with the process. Here are some important considerations to help you get started: 

Notaries’ Fees: In France, notaries’ fees include the equivalent of stamp duty, land registration costs, and disbursements. These fees are charged on a sliding scale based on the property’s cost and typically range from 7% to 8%. You might incur estate agent commissions, so make sure you’ve clarified if these fees are included in your contract. 

Council Tax: France levies two types of council tax—’

With its rich culture, stunning landscapes, and delectable cuisine, France continues to be a top choice for Brits seeking a holiday haven or a serene retirement destination. However, buying a property in France involves navigating a complex process with specific rules and costs. To make sure your journey through the French property market is stress-free, it’s essential to have a comprehensive budget in place that accounts for all expenses. 

In this article, we’ll explore the steps and costs involved in purchasing a house in France, from scouting trips to taxes and fees. 

Scouting Trip: Discovering Your Dream Property 

Before diving into the world of French real estate, you’ll want to test the waters with a scouting trip. This allows you to explore the diverse range of properties available and which area suits your needs. From rustic retreats in wine country to vibrant urban centres and scenic ski resorts, France offers many choices for potential homeowners. 

At this stage, we recommend starting to think about the impact of foreign exchange. Exchange rates are constantly fluctuating. This means that when you decide to buy a property abroad, the real-term cost of your purchase can change with the rates. Imagine getting to the point of buying your dream property, and the price is different from when you made the offer. That’s the reality of the foreign exchange market – small changes make BIG differences when you exchange a large amount of money. 

The Costs: Budgeting for Your French Property 

Whether you seek a holiday home or a permanent residence, understanding the process and costs is crucial. And while investing in a holiday home in France can be an appealing prospect, it comes with its share of expenses. So, when planning to buy a house in France, including all these costs in your budget is imperative. 

Some key financial considerations include: 

Currency Exchange Costs: Fluctuating exchange rates and transfer fees can significantly impact the property’s final price. High street banks can charge up to £30 for each overseas transaction, which can add up quickly when combined with legal fees, taxes, and maintenance expenses. 

There is also a lot of variance in the market, which means that the exchange rate you get from one provider can be significantly different to one you might get from another. This can be between 4 and 5%, meaning choosing the wrong provider could wipe thousands of pounds from your budget. 

By using a specialist foreign exchange service like Moneycorp, you get access to a range of currency tools that can help you to fix the rate for up to two years with a forward contract or target your preferred rate with a Market Order if you’re optimistic about where the market is heading. Moneycorp can also source the most competitive rates from its panel of 16 liquidity providers. 

Mortgage Considerations: Like UK mortgages, French mortgages are available with both fixed and variable rates. Fixed rates have historically been the preferred choice for holiday home buyers, as well as variable mortgages with capped monthly payments, which offer flexibility by allowing the mortgage duration to increase if interest rates surge. 

Having a mortgage in principle in place is a valuable asset when you start viewing properties, as well as a French bank account – which can help prove your financial capability. 

Taxes and Fees: What do you need to know? 

Navigating the French tax and fee landscape can be challenging if you’re unfamiliar with the process. Here are some important considerations to help you get started: 

Notaries’ Fees: In France, notaries’ fees include the equivalent of stamp duty, land registration costs, and disbursements. These fees are charged on a sliding scale based on the property’s cost and typically range from 7% to 8%. You might incur estate agent commissions, so make sure you’ve clarified if these fees are included in your contract. 

Council Tax: France levies two types of council tax—’taxe foncière‘ (land tax) and ‘taxe d’habitation‘ (residence tax), which includes the equivalent of a TV license. The landowner is responsible for the land tax, while the occupant typically pays the residence tax. If you plan to rent out your property, be sure to research your tax obligations thoroughly and seek the advice of a professional if you’re unsure. 

Moneycorp can help you secure a competitive exchange rate and minimise fees. They offer a range of specialist products and tools to ensure your money goes further, allowing you to navigate the fast-moving currency markets confidently. 

It’s never too early or too late to get in touch!