Friday, 28 October 2016

The Professionals

If you are buying property in France, you may well be unsure which, if any, professionals you need to use in your property transaction. Here is our brief guide to help you:

Accountant – you may be surprised to find this one on the list, but it may be beneficial to you if you purchase your house in the name of a SCI for example, or if you plan to run a business in France. A bilingual accountant can explain to you the most favourable way to structure your plans, and assist with your first returns.

Architect – The quality of French architects is generally very high, and you will need to employ one if you are considering a build of 170m² or above. Below this figure you can use someone who may not be qualified as an architect, such as a maître d’oeuvre, but you need to be careful about their competence. An architect can be a good steer to advise you on any major renovation project, and this is generally money well spent.

Currency expert – as a business, we always recommend our clients to use a currency exchange company if they need to switch currencies. The best FX companies will offer rates that are between 2.5 and 5% better than those offered by the High Street banks. Some clients are suspicious because they are not banks, and prefer to use their tried and tested bank. I recall one client from the Isle of Wight who purchased a property back in 2003, and chose not to use our currency experts. He got a truly rotten rate, and advised me that he had to stay with the bank out of loyalty. He subsequently sold and returned to the IOW several years later, and I reminded him to use our FX providers rather than the bank. Guess what – he used the bank and got an awful deal again. Some price loyalty!

Diagnostics – when you buy a French house there are an increasing number of professional surveys that must be provided by the seller as part of the sale process. The survey reports are provided to the notaire for annexation to the sale and purchase agreement and, ultimately, the deed of sale. These cover the following areas: - Asbestos, Lead, Termites, Energy Efficiency, Natural or Industrial Risks, Electrical Wiring, Gas Installations & Septic Tanks. Some of these are useful and some are pretty useless. They do give you some exact information about what you are buying though.

Financial adviser – too few buyers consult an adviser versed in both the UK & French financial systems. I think that advisers have a bad name because of fees / commissions. But today, fees are relatively low, and a good financial adviser can structure your investments so that you pay minimum tax, and perhaps even advise you about a better, more tax effective pension scheme. Sounds like a win / win to me, but few clients go down this route.

Insurance agent – many buyers take over the vendor’s existing insurance policy when they buy in France. But ask yourself – does this provide me with the cover that I need? A far better option is to speak to our bilingual assurance agents, who can offer claims service & schedules in English as well as French, plus discounts for multiple policies.

Notaire – if you are buying a French house then you will need a Notaire. These experts are generally very competent, but their skill sets do vary considerably. We tend to recommend bilingual notaires who are used to deal with English speaking clients. They will listen to your requirements, particularly with regards to succession, (what happens when you die), and structure your purchase accordingly. They will often prepare a Procuration (Power of Attorney for someone in their étude to sign on your behalf. They can also advise you about wills. You can appoint a separate Notaire to the vendor if you wish, at no extra cost. We generally advise against this, as frequently there is a bit of professional posturing, and there is no real added value.

Solicitor – just below 5% of our buyers instruct a solicitor to assist them with their purchases. Usually, they are buyers who feel rather insecure about the process that they are about to undertake, or have reservations about the transaction in some way. We have no objection to clients appointing a solicitor, but we do feel that they add little to the process, as pretty well everything that they do is covered by the Notaire. What they can do is add an element of conflict between buyer and seller, because they tend to be rather “picky” about small, and often insignificant details. As an example, one solicitor advised that his client was not prepared to sign as whilst the fixtures & fittings included in the sale had been fully itemised, we had not included door furniture, i.e. door knobs. The Notaire, unsurprisingly adopted a stance of “I am not being moved”, and the UK solicitor backed off. The buyer was appalled when we told them – they had no idea of how awkward their solicitor was being. They can also cause conflict with the Notaire(s), who also see their professional abilities being questioned. They do not come cheap, and I have yet to see one have a major input on the content of a Compromis de Vente in 15 years, so I suspect you could spend your money more wisely.

Surveyor – between 5 and 10% of our buyers decide to opt for a pre-purchase survey, as this is the “done thing” in the UK. Again, a report of this type does not come cheap, and there is normally a lot of small print about what is excluded. Bear in mind, an old C17th house will probably have a roof supported by beams that are literally trees, and follow the contours of the tree. If you want something absolutely squared and exact you probably need to look at a new build! Once again, many clients go down this route for “reassurance”, and then totally ignore what the report says because they love the property.

Personally, I think that the most important areas are to use a currency company to exchange into Euros, and consider using a financial adviser to point you in the right direction for the structure of your finances. A solicitor and surveyor are really only necessary if you really feel unsure about what you are doing. They come at a cost – and perhaps that money can be better invested elsewhere in your French house?

Thursday, 13 October 2016

Obtaining a French property valuation

Ask the Experts

"I have owned a house in Vendée for 16 years and am thinking of selling it. I recently had an estate agent give me a valuation and was surprised when I had to ask for a written quotation and was asked to bring in documents of proof of ownership for their files. I was expecting them to direct me to a notaire. I did ask about a notaire dealing with it but was told they would carry out the sale. Is this the normal thing in France?"

Peter Elias of estate agency Allez Français ( replies:

There are many methods of estimating the value of a property in France. Fully qualified experts are known as experts immobilièrs and they charge for this service; by comparison, estate agents will generally provide a valuation free of charge.

Some agents – and this could be the case if yours is a modern property – want to see the ownership documents and then calculate the appropriate value from the square metre surface habitable of the property, based on local values.

By way of example, we tend to use a range of tools and knowledge to calculate a value. We would still want to see the proof of ownership documents demanded here, but we would visit the property to see its location and condition a first hand, and factor in matters such as the quality of renovation and the state of the kitchen, bathrooms and heating system. Proximity to airports, train stations, schools, shops and other services would also be considered.

Without a complete set of diagnostics, we are reluctant to advise accurately on price. How can you, for example, confirm a valuation if you do not know if the electrical installation is up to date, or the fosse septique conforms to the regulations? Unfortunately, some agents do offer assurances to their vendors despite not knowing the outcome of these reports.

Some notaires also as estate agents, but their advertising tends to be very limited and they may only find you a local buyer. You can of course appoint a notaire in addition to an estate agent if you wish.

You do not say whether this is a main residence or second home – if the latter, then capital gains tax could be another issue that needs to be taken into consideration.

This article is featured on page 84 of the October edition of French Property News.

Monday, 10 October 2016

Allez-Français Annual Conference

(Which could also be described as a team get-together!)

Our annual "reunion" took place on 7th & 8th October at the superb venue of Chateau Castel Novel on the outskirts of Brive. to a certain extent, this is a team building event, but also an investment in our agents, and a reward for their hard work. As well as the Banquet Dinner on Friday evening, we also visited the Denoix distillery for a tour of their facility on Friday afternoon.

The main goals of team-building are undoubtedly to improve productivity where possible and maintain or even improve motivation. By taking our agents out of an office environment really helps eliminate distractions, and for us all to share a bit of relaxation. Because we cover such a wide area of S W France, the number of times when we can really get together are very limited. This time we had the added bonus of being joined by Christian Perron, MD of JeSuisAgentImmobilier, plus Adam Bobroff & Tom Taylor at Foremost Currency.

As a company, we have been "licensed" as agents for over 10 years now, and this has always been a really good relationship. Foremost Currency have also been our "currency partners" for clients since their business was established over 10 years ago.

In a world where attention is constantly focused on making the client happy, some agencies forget about their most valued asset — their agents.

Afterwards the feedback was that the team realise how lucky they are to be part of a company that values every individual as a person and also as a team member. For us all, this was seen as an opportunity to ignite creativity and share ideas. At Allez-Français we have always encouraged / coached our agents to "run their own business as a business within our business", and we provide the proven business methods as a guide plus 1st class real estate systems (including software) which ultimately steers our agents towards success.

We are a small team, (5 couples), with no superstars, and no big egos. We share similar values, and have the same ideas about customer service, and how we present our company. It is important for us, that we use events like this to reinforce those values, and reward everyone, so that they feel special.