Going it alone, is it worth it?
Sharon Evans looks at the pros and cons of buying French property privately as opposed to the more traditional route via an estate agent
In the UK, sales between private individuals, without the involvement of an estate agent, are not commonplace. True there are a number of websites nowadays enabling sellers to advertise their property direct to potential buyers, but the vast majority of us still use the services of an estate agent when buying or selling a property.
In France, however, private sales, usually referred to as ‘entre particuliers’, are common. They tend to be favoured by the more mature buyer, who perhaps has experience of buying and selling, and who therefore knows how things work and what to expect from the legal process.
The younger generation tends to favour buying through a local agent, as do those who are new to an area, where they are unsure of local property values. But for a well-informed buyer, the idea of potentially saving himself the cost of the agency fee is appealing.
As you will no doubt have seen while browsing various internet portals, properties are offered either as an agency sale or a private sale, and so inevitably I am often asked by clients, what are the benefits and disadvantages of buying through an agent as opposed to buying direct from a private seller?
Agency commissions are usually included in the price of a property, which you will see in the agency window as ‘FAI’ (frais d’agence inclus), and a French agent is obliged to display his fee tariff in a prominent position in his office, so that the buyer is clear as to how much commission the agent will earn from the sale.
These vary according to the selling price and the individual agent, some starting as low as 3% going up to around 10% (the commission on a €30,000 property for instance will usually be a higher percentage of the selling price than that due on a €800,000 château). Typically on a €100,000 property, you might expect an agency fee in the region of €6,000-7,000.
That’s not an insignificant amount of money and in these straitened times, it’s easy to see why some buyers might feel it to be a saving well worth making. Generally, when UK buyers consider whether or not to buy privately, the issue of agency commission is uppermost in their minds. So it’s fair to say that when people ask me the question about whether to buy privately or through an agent, what they really want to know is what does the agent do for this commission, and how will it benefit me?
There is no question that for a UK-based buyer, perhaps with limited French and unfamiliar with how the French buying system operates, buying through an agent will provide that extra level of support, as they guide you through the sales process. A good agent will be able to keep you informed as to the progress of the sale, and when it comes to completion day they should accompany you to the notaire’s office for the signing of the acte de vente.
It is probably worth pointing out here that there are no hidden fees or charges for our service ie. buying through Clé France. The price you pay is the same as anyone walking through the door of the agency, and therefore the same as the price paid by the French buyer. Estate agents (Immobilier) and notaires in France are obliged by law to display there commision rates promienently in their office. We are able to offer you this service because our network of agents and notaires share there commision with us.
So when you buy through Clé France you can be confident that you are paying no more than the standard commision rates you would pay anyway, but you have the added benefit of a bi-lingual support team.
Once the sale is complete, they will arrange for the transfer of all utilities in your name, and will be able to help you with setting up bank accounts. These little extras are not an obligation on the part of an agent in France, but good ones perform these services as a matter of course, and importantly at no extra charge.
As you would expect, legal documentation will be in French, but agents who are used to dealing with English-speaking clients may well provide English versions of the first sales contract (compromis de vente). The notaire will usually conduct the sale and relative paperwork in French, but again, the agent may well translate for you on sale day, or provide a locally based translator to attend.
However, it should be noted that estate agents are not translators by profession, and at the critical contract stages of the process, it may be of benefit to hire a professional translator to assist.
Many French agents are born and bred in the area in which they work, and their network of contacts will be truly invaluable. Your estate agent will probably be your first contact in France, and I believe potentially the most valuable.
He or she will be a mine of information, and throughout your dealings, a good agent will be able to advise on a whole range of matters that are not within their immediate remit, such as local tradespeople, issues around planning matters, and possibly even local schools and health.
These are clearly some of the practical benefits of buying through a good local agent. However, there is a further aspect to the private sale market in France that is worth a mention, and that is the matter of property valuation.
A French agent, who will be primarily selling properties for French owners to French buyers, will have a clear idea of the property market in their local area, and the correct valuation of any given property.
It is sometimes the case that owners who take the step of privately marketing their property do so as they don’t like the agent’s valuation, believing it to be too low. Indeed it is generally thought that privately advertised properties are some 20% more expensive than those listed by agents.
In my own company we are often approached directly by private sellers wishing to market their property on our site. I refer such enquiries to our local agent on the ground in France, who would then mandate the property for sale in the normal way, at which point it would come on to our site. Some time ago I was approached by a gentleman selling his home near Alençon. I suggested that he speak to my associate in the area who would do all the necessary, but when he knew who the agent was, he immediately rejected the idea, saying that he had no wish to do business with that particular individual.
I was curious to say the least! My colleague is always very charming and an ardent Anglophile. I couldn’t imagine what he had done to cause such offence! It later transpired that the seller had already invited my colleague to mandate the property some six months previously. He had expressed his view that this was a very beautiful property, and that it should be marketed somewhere around the €230,000 mark. The seller wanted me to put it on our site at €500,000.
That is not to say that every private listing is overvalued. It is simply to say that if you are buying in a market that is unfamiliar, a good agent will be able to guide you as to the relative value of one property versus another, and importantly show you a number of different properties for comparison. He will also possibly be in a position to guide you as to the vendor’s position and attitude to negotiating.
As I said previously, buying privately is very commonplace in France, and UK buyers should absolutely have access to the same choice of available property as the French. I myself have bought and sold a few of my own properties privately in France in the past, without any problems.
British sellers who are accustomed to a more aggressive style of marketing in their own country sometimes find the French way of doing business a little frustrating, and if their language skills aren’t great, feel intimidated at approaching a local agent. So selling privately looks like a good option.
However, if as a seller you want to go down this route, don’t underestimate the cost of marketing, which can be considerable, especially if your property is on the market for any length of time.
For the buyer who has a good understanding of local market conditions and prices, buying privately can be an alternative. If a property is priced correctly, you could indeed save some money (and bear in mind for comparison that a privately advertised property should therefore be a little cheaper than its agency counterpart, to take account of the agency price including agency fees).
The other critical factor will be your language skills: are they of a sufficiently high level to read and correctly understand the process of buying and selling? If not, you will probably want to hire a translator for the documentation as well as for your liaison with the notaire.
There is a lot of information available nowadays, and some people feel sufficiently well researched to go through the process unaided.
Sharon Evans is director of Clé France
Tel: 01371 811799
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