Property Sale contract (Promesse de vente) explained - example

Terms and conditions

 

French Property Law: Property Issues

Dependant on the specific property, the appropriate advisor will need to vet the property for the issues such as:

• Property Description;
• Title;
• Mortgages;
• Property Organisation;
• Construction;
• Third Party Rights;
• Searches (Asbestos, Termite & Lead)

These matters should be appropriately covered by the contractual agreements. Additionally, Valuations & Structural Surveys may be requested.

French Property Description

When visiting a prospective property, the potential purchaser should ensure that there is no misunderstanding as to what the proposed price comprises. The potential purchaser should confirm and inspect the full dimensions of the property (references to land plots or, in apartments, the specific unit of property).

Clarify as to whether any fixtures, fittings, white goods are included in the sale. It is advisable to contractually detail such items, as it is a general rule in France that the owner may remove anything prior to completion as long as there is no physical damage to the walls or plasterwork. Any agreement concerning the property should also be added into the contract along as an obligation on the seller to keep the property in a reasonable state.

 

Title to French Property

Title to ownership must be established for at least thirty years prior to any French property sale. Previous title deeds and land registry searches will evidence this fact.

On completion, the Notaire will be responsible for registering the title at the appropriate land registry. The notaire retains the original deed and it is only once registration formalities are complete (6-9 months) that the official copy of the title deed (the "copie authentique") will be made available to the purchaser.

In the meantime, the Purchaser will receive a certificate from the Notaire attesting the new ownership of the Property, which are recognised by French administrative authorities.

 

Mortgages for French Property

It is common practice that the preliminary purchase agreement will be subject to the confirmation that any existing charges or mortgages revealed by recent searches amount to less than the sale price (or, if more, that the relevant creditors agree to discharge the same).

 

Property Organisation for French Property

The method of Property ownership is particularly relevant for flats within a property, and does not tend to be considered for individual houses. The system of ownership devised for managing flats, offices and retail properties within one building is called copropriété.

"Copropriété" (co-ownership/condominium)

This system permits the purchaser of a property to acquire the full freehold ownership of certain units, hence dividing occupation of the property.

Buildings are divided into private and common units. The full freehold ownership of the private units is passed to the respective owners whilst the common units (e.g. entrance lobby, garden, roof) are collectively owned in "copropriété" proportionally relating to the size, situation and nature of private space held by each owner.

The definition and management of units is set out in the "règlement de copropriété". This document should be analysed to determine the proportionate shares in the control and service charges of the common parts. The proportionate share is often expressed as the number of thousandths or ten-thousandths, of the total surface area of the building belonging to the owner in question.

The day-to-day running and any reparation of the Property is dealt with by an elected manager ("syndic"), usually a professional. Certain of the owners or their representatives will be selected to form a management committee ("Conseil Syndical"). The synidic will be able to inform the Purchaser of the costs of the common units and any anticipated works. The Seller may agree to pay the costs of works initiated (but not yet completed) before the Purchase goes through.

 

French Property Construction Warranties

Any structural construction that has been carried out within the last ten-years must be supported with the requisite administrative authorities (building permits, completion certificates, compliance certificates).

There will usually be a contractual opportunity to withdraw from the purchase should the property not have satisfactory construction authorities.

 

Third Party Rights and Law

Generally, in addition to those rights that may appear on the title deeds, rights of way, rights of light and other easements may be created over property by private agreements, operation of law, administrative decisions and planning regulations.

The rights are checked off through examination of the title deeds or land registry. Although the seller may have created rights over the property which would not appear on the above documents, it is usual that the seller states that the property has not been subject to any such easements.

 

French Property Law Searches

The Seller is legally obliged the Vendor to supply information on the environmental issues listed below if he wishes to be exempt from guarantees for hidden defects.

• Asbestos: Asbestos searches should show any presence the private and common areas of the Property.
• Lead: Properties constructed prior to 30 December 1947 require lead searches for pipe-work and painting.
• Termite: Valid Termite reports should be produced showing whether the property is free from termites or any other wood burrowing parasites.

 

Valuations & Structural Surveys for French Property

Property valuations and structural surveys do not play a significant part in standard French conveyancing. Naturally they can be organised through independent companies. In Paris, another means of assessing the Property's approximate value is by requesting the Notaire to cross-reference the price with an indexed database of similar sales in that area.

It is important to note that building surveys are not always desirable in terms of negotiation unless you can assure the seller that the survey will be carried out expediently (it is advisable to take prior contact with a surveyor and inform the seller). In any event, the survey should be completed prior to entering into the preliminary purchase contract or adequate provisions placed in the contract in case the survey reveals any costly defects.