Tuesday, June 30, 2009

Selling your French property

Unlike their British counterparts, French estate agents are licensed by the local Prefecture and controlled by strict legilsation and the rules of either of the two main professional associations FNAIM or SNPI, to which they usually belong. Their offices can be subject to unannounced spot checks by the police and licensing authorities, and their professional body. If they receive and hold client monies (such as a depsoit on a sale) they should be licensed to do this and have special indemnity insurance (a certificate displayed in the office should show their authorisation and the amount insured), in addition to their professional liability cover.

Agencies employ negotiators on a salary or commission only basis, while some 'property negotiators' work largely independently while being loosely attached to an agency as an agent commercial. If they are correctly registered with the Prefecture they are entitled to sign sales mandates (described below), negotiate between buyers and sellers, and help conclude property transactions, on behalf of the agency.

As a vendor, you can instruct one or more agents to handle the marketing and sale of your property, signing either an exclusive sales mandate (mandat simple), usually for three months renewable, with a single agent; or non-exclusive mandates (mandat simple sans exclusivité) with several agents. The mandate authorises the agent to market the property on your behalf, in return for a percentage commission - the amount being stated in percent and figures in the mandate.

There are arguments for and against exclusive or non-exclusive mandates. Some argue the more agents the better chance of a sale, while others prefer to select an agent with a known customer base for your type of property and someone who is prepared to work extra hard to achieve a sale. Under a simple mandate, problems can arise between rival agents as to who actually introduced a client/buyer and is entitled to their commission. Also in cases where a vendor claims he found the buyer himself through his own efforts.

The consequences of signing a mandate are serious: for example, you cannot change your mind and decide not to sell (normally within the first three months); and if a client originally introduced by an agent returns after a lapse of time (12 - 24 months) and makes an offer to buy your property, the agent will usually be entitled to his commission.

If a client presents you with a willing client offering the full asking price on the property, you cannot refuse or offer the property to someone else, withou becoming liable for the agent's commission - he has after all fulfilled his part of the contract with you.

Once a client makes an initial offer in writing, below the full asking price, the agent should contact you to see if this is acceptable, and you may agree or decide to hang on and await a better offer. Once an initial offer has been agreed, at or below the full asking price, it is difficult for either side to withdraw, and the agent will be pressing both parties to proceed to the compromis de vente.

The transaction should then proceed smoothly as described in the postings below on Sales.

Property buying: the notaire

Every French property transaction involves the intervention of a notaire whose costs will add up to 7 or 8 per cent of the value of the sale. Of this figure about 70% goes to the government in taxes and land registration charges, and the remaining 30% or less is the notaire's actual fee.

French notaires have a dual role. Not only do they ensure the legality of the property transaction and that it fair to both parties, but they also act as government agents, collecting the taxes raised on the sale. These can include capital gains tax, which for example is charged on properties that are not your principal residence and owned by you for less than 15 years. They also act as stakeholders for any monies paid, such as deposits, which are held in special government controlled trust accounts which do not attract interest.

They are also responsible for allocating the sales proceeds to the various owners in a cases of joint ownership under typical situations such as an inheritance, partner divorce or separation, or even a bank or mortgage company if the owner/vendor has outstanding payments due.

Their conveyancing role includes checking that the owner has good title to the property (ie that it is his to sell), verifying that the expertises (property checks) have been carried out, and ensuring generally that there are no unpleasant surprises such as an ancient right of way or a charge on the property.

How far a notaire will go in advising the parties is debatable. He certainly does not act as the advocate of one or either of the parties, even if you choose to appoint your own notaire in addition to one acting for the vendor. In this respect his role is unlike the adversarial stance that might be taken by a British solicitor acting for you in a property transaction.

Some buyers consider using a home-based lawyer or other expert as an advisor. However, even someone with a knowledge of French law who is not on the spot, can do little more than check the various documents and advise on their implication.

The notaire's greatest advantage is that he is in place, knows the area and the local property market, has handled umpteen transaction, is used to resolving proplems, is totally impartial and is bound by a strict code of practice.

Property buying: the 'compromis'

Part of the French property buying process involves signing a pre-contract, known as the compromis de vente. This is very like the final sales agreement you will eventually sign before a notaire handling the transaction and in the presence of the other parties or their representatives. However, the compromis is different in that, although it commits you to the purchase and the vendor to the sale, it allows the buyer to withdraw from the sale subject to certain conditions.
The first level of protection for the buyer is the seven-day 'cooling off' period, introduced as part of the law protecting consumers from high pressure selling at home. This is applied in the case of the compromis for seven days after receipt of the document, signed by buyer and seller, which is sent by recorded post to your home address in France or elsewhere. At this stage you have seven days for reflexion and can cancel the deal by notifying the agent or notaire promptly of you inention not to proceed.
The compromis also allows you to introduce certain conditions attached to the sale, one of which can be - if you are not payng cash - that the sale is subject to your obtaining a loan or mortgage. Such a clause, known as a clause suspensive effectively allows you a further six weeks or so to arrange a suitable mortgage. If funds are not forthcoming, you can withdraw from the sale without penalty, provided you can demonstrate due diligence in your effors to find a loan.
Other clauses might include that the deal is subject to a satifactory survey or obtaining planning permission. Both parties have to agree to suspensive clauses, and not all vendors are happy with sales subject to your obtaining a loan (because of the additional delays and uncertainty) and would probably reject a clause saying that the deal relied on your selling another property - such as your home in Britain - again due to the undertainty and risk involved.
The compromis can be prepared either by an estate agent handling the sale or the notaire. An initial deposit is usually asked for at this stage but it is not obligatory. If a deposit is paid, it would be refunded if the sale does not proceed, for example if one of the suspensive clauses was not met.
Attached to the compromis will be a number of documents including the report of the expert surveyor (known as the expertises) covering things like asbestos, lead, termites, state of gas and electrical installation etc which the seller has to have done (and pay for) when putting the property on the market. For properties located within a co-ownership building, such as an apartment, the reports include confirmation of its official dimensions (known as the surface loi Carrez). These will also be attached in due course to the final sales act.
It is advisable at this stage also to have copies of the latest meeting of the co-owners, to see what has been voted for - such as external painting or major repairs - as the new owner will inherit the cost, as well as the benefit, of these. You can read more about this subject under the heading The Syndic.
Note also that an initial offer to buy or sell, whilst being little more than a statement of intent by both parties to proceed to the next stage - the preparation of the compromis - has in some cases been ruled as a binding document. It is unwise therefore to sign an offer unless you really intend to proceed and certainly never sign several offers, in the hope of 'reserving' a property or several.
Finally, sellers should note that the seven-day reflexion period and right of withdrawal applies to buyers only.

Monday, June 29, 2009

Ports and marinas in Roussillon

One of the joys of living on this part of France's Mediterranean coast is ready access to no fewer than seven attractive seaside towns, all of them offering a marina or leisure port -between Perpignan and the Spanish border, against the backdrop of the Pyrenean foothills.

Starting with Canet in the north, this is a busy town of 12,000 and just ten minutes from Perpignan, making it popular with residents living all year round and weekend and summer visitors. It has a 9 km long seafront, with fine sandy beaches, and a leisure port with over 1,000 berths. Some people choose to live on their boats all year round, in the inner harboar close to a recently opened technical lycée devoted to preparing students for future careers connected with boating and the sea. The Port area features some of the most attractive property developments including modern apartments.

Canet is joined to its southern neighbour St Cyprien (10,000) by a spectacular coast road that runs along a narrow strip of land between the beach, popular with wind surfers, and an inland lake and nature reserve, home to many species of bird including pink flamingoes. The marina offers 2,200 berths and a further 128 moorings on the lagoon, making it the second largest marina on France's Mediterranean coast. St Cyprine South has some of the most recent and most expensive properties in the area, though studios and small apartments are still available at around 100,000 euros.

Port-Argelès is a comparatively recent development over the last 20 years, with a marina of around 750 berths, and small groups of apartment buildings, no more than four stories high, along the style of St Maxime or Port Grimaud on the Cote d'Azur. The Port is lively in summer and famous for the variety of its restaurants and upmarket boutiques. There are twice-weekly markets in the high season. Studios and small apartments at around 100,000 euros.

Collioure (see below) has few facilities for leisure craft, but some moorings are available around the bay. There is a landing stage for ferries from Port-Argelès and bringing passengers ashore from huge cruise ships moored out at sea.

Next to Collioure and continuing south, Port Vendres is a busy commercial and passenger port, with berths up to 155 metres length, including facilities for roll-on/roll-off ferries, and a leisure port offering 270 berths. The two remaining resorts are Banyuls-sur-mer which has a small leisure port of 120 berths, and Cerbère on the Spanish border, which offers 150 berths during summer, on floating pontoons.

The pincipal marinas are managed by a capitainerie proving services such as secure moorings with water and electricity, fuel and washing facilities. The marinas also offer a range of technical services for boat care and maintenance, ship chandlers, shipbrokers and schools providing instruction in boat handling (to secure a permit), and deep sea diving. There is a perennial shortage of berths, with most of the ports in course of expansion. Mooring fees are from 1200 euros annually (5 metres) to over 5,000 euros (18 metres), with daily rates from 12.50 to 70 euros depending on the length of the craft and time of year.

Saturday, June 27, 2009


Collioure is the next village to where I live and quite different from my own town and pretty well unique on this part of the Mediterranean coast. Formerly a fishing village - this activity is now centered on the next town south Port-Vendres - but still famous for its anchovies, Collioure is a lively artists colony. This dates back to the early years of the 20th century when artists such as Matisse and Derain first discovered Collioure and were amazed by the brilliant light and colour, compared with their rather drab home environment in northern France and Belgium. They created a whole new style of painting known as Fauvism, which shocked many of their contemporaries.

Today Collioure's steeply sloping cobbled streets are lined with artists' studios and galleries and a hotel on the waterfront has a priceless collection of works of art left to them by the Fauvists and others in payment of their food and lodgings.

Between Argelès and Collioure the Mediterranean coast changes abruptly from flat sandy beaches to a rugged, rocky coastline, where you can find interesting coves and hidden parcels of sand for a quiet day out. This is where the eastern end of the Pyrenées plunges ino the sea and explains why the region is called Pyrénées-Orientales.

If you have a head for heights and strong legs, you can climb to the top of the mountain range to one of the early watch towers that were used to signal the arrival of Spanish invaders, using either smoke signals by day or bonfires at night. The centre of Collioure is dominated by the summer palace of the Kings of Majorca (their main residence is in Perpignan) both of which can be visited. They are reminders of when the region was under Spanish control, before the border was moved a few kilometres south.

On the surrounding slopes of Collioure you will see many hectares of vines producing the AOC Collioure rouge and rosé wines, and further south the vins doux naturels (sweet wines) such as AOC Banyuls and Muscat de Rivesaltes, which is also produced north west of Perpignan. Many vineyards offer guided tours and the popular tourist train does a circuit of the some of the nearby vineyards.

Collioure is very busy in summer and access by road can be difficult, although you can use an out-of-town car park and take the navette into town. Another possibility is to take the coastal train from Perpignan, Elne or Argelès (which continues south to the Spanish border at Cerbère and Port-Bou, where there are connections to Barcelona). There are also regular ferry trips from Port-Argelès, just a few minutes across the bay. You can also walk along the coastal path which starts at the Racou, a former artists' colony and the last sandy beach, just south of Port-Argelès.

Another artistic centre is at Cerèt, about half an hour's drive inland from the coast, famous for its associations with Picasso and the Cubists. There is a museum of modern art with a permanent collection and visiting displays.

Holiday time!

The holiday season is about to begin again on the Mediterranean with the arrival of the "juilletistes" (july people) followed by the "aoùtiens" (august people). The high season is quite short, barely six weeks, as for the French in particular it is linked to school holidays, with the majority of people returning by the last week in August to prepare for the new school term and "la rentrée".

My small town of 10,000 grows to about 50,000 at any one time, though concentrated in specific areas such as the centre beach which has the most facilities - cafés, restaurants, sandwich bars etc. But the beach is never jam packed and it is surveyed by life guards, and divided into sections for bathing, surfing etc. Pleasure boats are not allowed inshore, except for access to the marina with its 650 berths, and dogs are banned from the heach for hygiene reasons. The beaches are mechanically cleaned over night and the promenades swept early every morning. Not surprisingly the town has received numerous Blue Flag awards for the quality of its facilities.

We residents tend to plan our normal activities to take account of the influx, going swimming very early or late in the evening; visiting the supermarket during quiet periods and avoiding Mondays when the new arrivals tend to stock up for the week. The restaurants follow a similar pattern and are curiously quiet on Friday evenings, as departing visitors get ready for the long journey home on Saturday, and Saturday evenings when the new arrivals are still on their way or have not yet found their way round town.

It all ends very suddenly in September when the town seems to empty virtually overnight, and we settle down to glorious sunny days than can last till a few weeks before Christmas. It is my favourite time of the year, and an ideal time to visit the region. Most hotels and restaurants remain open until the end of October, and it is easier to get around on the roads and visit the regions many beautiful attractions.

Self-employment in France

From January 2009 a new form of self-employment was launched by the government under the 'auto-entrepreneur' scheme, basically allowing you to set up and run a small business, and pay tax and social charges only on income actually received. Most other forms of business registration are based on social payments being paid on an estimated basis, and have left many people struggling in their early years trying to pay huge social charges against minimal income. It was probably the greatest single disincentive to setting up a small business in France.

Already nearly 150,000 individuals have registered as auto-entrepreneurs since January, the vast majority being middle-aged consultants (!) followed by personal services (teaching, domestic help etc) and those in involved in computers (website developers through to assistance in case of a crash).

Very few artisans have registered, as they have found it difficult to secure the necessary insurances associated with virtually any trade connected to building and maintenance. There has also been a lot of lobbying by groups representing artisans registered with the Cambres des Métiers, and the government has given into pressure, effectively blocking any more applications from artisans wishing to adopt the auto-entrepreneur status. This is particularly difficult for craftsmen such as potters creating and selling their own work, for example, who will have to choose another route.

For the rest of us, the auto-entrepreneur scheme allows you to run a small service business - such as consultancy - up to a turnover of 32,000 euros (the limit under which you have to register for VAT), and a business classed as 'commerce' (buying and selling) up to just over 80,000. Tax and social charges are paid on actual income (no allowances for expenses) at around 20% for services and 13% for commerce. These are paid monthly or 3-monthly as you earn.

Friday, June 26, 2009

Vegetarians in France

It seems that only about 2% of us are vegetarians in France but fortunately there is a growing movement towards organic (bio) products, including meat of course. The area where I live just south of Perpignan is known as the Roussillon Plain and is a major production area of fruit and vegetables, which form a large part of the acclaimed and healthy Mediterranean diet. There is also a large wholesale market (St Charles) at Perpignan, which receives products coming across the border from Spain and the southern Mediterranean for distribution all over France.

If you eat fish, there is an enormous supply, and I have a fish market a hundred yards from my front door at the port where I live.

The bio alternative is attracting more and more producers, and their numbers have doubled in just one year - from around 40 to 80 - in Roussillon. There are numerous local producer and organic markets and organic shops, selling everything from vegetables, cheeze, fruit, organic wines, and cosmetics, soaps and cleaning products. Most of the supermarkets are now including a growing organic section. Genuine organic products carry the official French white-on-green 'AB' certification label.

There is a regional guide to organic producers and sales outlets, including markets, available from local tourist offices. For more about organic wines you should consult my friend and wine expert Jonathan Healey's site www.jonathanhealey.blogspot.com

Travel from the airport

Visitors arriving in Pyrenées-Orientales have a choice of airports, including Perpignan, and Girona and Barcelona (Spain). Perpignan has regular daily flights from Paris, and by Ryanair from Stansted, with other low-cost carriers offering additional flights from various UK centres in summer. Girona is well served from Britain, Ireland and numerous other European countries, while Barcelona is a very busy international airport with flights to and from virtually every corner of the world.

There is a bus service from Perpignan airport to the centre of Perpignan where you can then take the train to Elne, Argelès-sur-mer, Collioure, Port-Vendres, Banyuls and Cerbère/Port-Bou on the Spanish border - a spectacular ride along the Mediterranean coast. Taxis are available but will probably cost more than your flight!

Girona is now served by a bus service that stops at Le Boulou (where you will need to be picked up for the short ride to the coast) and Perpignan. A further service is planned which will also take you direct to Collioure, Argelès, St Cyprien and Canet, then to Perpignan.

Barcelona airport is south of the city and requires a two hour drive along the busy motorway to the French border at Le Perthus, where you can continue to Le Boulou, Perpignan and the coast. The route is very busy in summer with holiday traffic and can be subject to police and customs delays at the border.

The arrival of the fast TGV rail link from Perpignan to Barcelona (via Girona) will provide further links to their respective airports. TGV services also link Perpignan with Paris and other French and European cities, and there is an excellent service to and from Lille (and Brussels) where you can change to Eurostar for London, without having to pass through Paris.

Thursday, June 25, 2009

Tour de France comes to Perpignan

This year's Tour de France starts in Monaco on 4 July and after a couple of days around Marseille reaches Montpellier on 7 July, before making its way along the Mediterranean coast to Cap d'Agde and Perpignan (8) passing through Canet, St Cyprien and Argelès-sur-mer, before arriving in the centre of Perpignan. Residents and visitors will have plenty of chances to watch the Tour near their home town, or by crossing the border into Spain, and later catching the stages in the Pyrenees.

After Perpignan the riders then travel to Girona, just across the border in Spain for the following day's stage along the Costa Brava to Barcelona (9). The following few days are then spent in the Pyrenees, before the Tour moves to central France, then doubles back for later stages in the Alpes, before ending its three week round trip in Paris.

The riders can look forward to spectacular coastal scenery and lots of sunshine!

Are you a sports person?

Coming here after thirty years in central London, one of the things I promised myself to do was get back to my old level of fitness when I used to go jogging virtually everyday, around Battersea Park. I have found it is very hard to live on the Mediterrean coast and not get fit, thanks largely to the glorious weather (average 300 sunny days a year), good food, good local wines and the availablity of so many sports opportunities.

Among the sports available are walking, climbing, jogging; tennis, golf; sailing, swimming, diving, surfing, sailboarding; skiing, mountaineering (the Pyrenees are on our doorstep); as well as every form of fitness training, aerobics, weight lifting. The wide range of teams sports include rugby (allez Perpignan!) and football, from youngsters to senior adult teams; basketball, handball, squash etc with facilities in virtually every town or a few minutes drive away.

There are yacht marinas at Argelès-Port, St Cyprien and Canet, and further up the coast at Barcares, Leucate and several other resorts on to Montpellier. Canet boasts an Olympic size swimming pool, often used by the French national team; and Font Romeau in the Pyrenees is an international centre for high altitude training, in conjunction with the university of Perpignan. At St Cyprien there is a former national sports training centre, now owned by the commune, with impressive indoor and outdoor facilities. There is also an excellent golf course.

My little town boasts 7 kms of flat sandy beaches and a 3 km promenade used by joggers and roller bladers of all shapes, sizes and ages, doing their own thing. What is impressive is the wide range of standards from those just about staggering along (me on some days) to the superfit. But nobody pays any attention to anyone else and all are welcome.

The Syndic

Living in a co-ownership property, such as an apartment, you will come across the building management service (known as the syndic) and usually a committee of residents who employ them. As well as owning your apartment you will also have a share of the building's common parts - corridors, lifts, stairs, garden, pool etc - and your monthly charges will include sums for maintaining these. Your voting power at the building's AGM depends on the size of your apartment and the number of 'units' (shares or tantièmes) you own in the building, in addition to the freehold of your apartment.

Normally everything runs smoohtly, and discussion at the AGM centres around everyday issues such as painting and maintenance, noise, dogs, permission from someone to add a terrace or close in their loggia, and so on. These are voted on according to the total number of points accumulated - a large apartment has more, a studio less, and so on. Occasionally there can be more serious issues, such as the one I am facing in relation to my own building.

It appears that since the last AGM in August 2008, a group of residents made a formal complaint to the syndic about offensive cooking smells coming from three of the restaurants on the ground floor below me. This led to an expert being called in, a court case and a meeting with the restaurant owners, who have been found to be in breach of local laws regarding correct air extraction equipment from their premises, and they have been told to put things right. Some of them have come up with proposals, while protesting that they have been established in the building in some cases for nearly ten years and there have been no complaints until now.

This has led to a mix of views among the residents, some who say they don't want unsightly air extraction ducts spoiling the look of the building and the restaurants should simply be shut down; while others argue we are on weak ground owing to the long period the restaurants have been operating without complaint and they have now offered to put things right, at their expense.

I have been taking soundings among people I know in the building, as all this arises when yet another faction says they are unhappy with the syndic's management of the problem and general levels of expenditure on cleaning etc; and want to sack them and replace them with another firm, which is within the power of the co-owners to do so. There is also the matter of interior decoration which is needed but ideally should be put on hold until any necessary work is done to accomodate the new air ducts which is more urgent. There is also the perennial conflict between the views of residents who live here all year round (very few of us) and absentee owners who visit occasionally and try and rent out their apartments during the summer season.

All this is outlined in the agenda for next month's meeting which may prove to be a lively one, and I will report on the outcome in due course.

French Property News

My article in the June 2009 edition, entitled 'Crisis, what crisis?' takes a fresh look at the economic crisis and how it is affecting France and the French property market.

Those of us in the property business are often accused of 'talking up the market' the moment we stop echoing the gloom and doom economic forecasts of popular newspapers, and my piece is based on published statistics, figures and expert opinions, rather than my personal views. I can talk realistically about my own area, which is a bit special, with a high proportion of second homes and holiday apartments. There are slightly more for sale than a couple of years ago, but prices have not dropped significantly as owners are not desperate to sell - nor are buyers in a hurry to buy, you might argue.

The result is a certain market stagnation, but with wider choice for those still buying. There are a number of major house building projects under way, for owner occupation, as the region is one of the fastest growing in France - don't worry there is plenty of space!

Upcoming articles look at the organic revolution taking place in the region, how to go about buying and selling property, and using an architect even for projects costing less than a hundred thousand euros.

Wines of Roussillon

Interested in local wines? Then you should consult the blog of my friend Jonathan Healey who is an acknowledged wine expert and author of the only book in English on the wines of Roussillon. Jonathan was educated at the University of California/Davis, one of the most prestigious wine schools in the USA, and is passionate about local wines, organic production methods and the important role of the small independent producer.

Here in Roussillon he organises wine tours for one day or longer, wine tasting events and seminars. He is also a prolific writer and translator, helping several French producers create their marketing materials, including a website, in English.

Website http://jonathanhealey.blogspot.com Book 'The Wines of Roussillon', Trabucaire 2003.