Author: The ESREA France Team

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What are the French rental agency fees for?

French Real Estate Rental agencies charge you a fee when they help you rent a property. We got a question from Caroline one of our readers who asked ‘what are the French rental agency fees for? What does the agent get paid for?”

Caroline, good question because when you rent directly from an owner you don’t have to pay an agency fee.

So here is the answer:

As a general overview French rental agencies are charging you for:

One
The Inventory of the Condition of the property and Included Items called ‘L’etat des lieux’ in French

Two
The drafting of the lease document called la rédaction du bail in French

Three
Preparation of your file called montage du dossier in French

Four
Visiting the Properties with you

It is important to note that at the present time most French real estate agencies have been charging around one months rent as the fee for service but now the government of France is changing this fee system by requiring the agencies to charge a fee that relates to the size of the rental space in some but not all cases, check with the agent you speaks with before engaging services so you know how much you will have to pay.

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2014 French Notary Fees Going Up Now Going Down?

An article in the Le Parisien, states the French government is preparing a reform of the notary fees charged on the purchase of a French property.

Currently, French notary fees are proportional to the amount of the real estate sale. The new proposal is to replace the proportional pricing with a fixed grid for pricing that would be re evaluated each year to reflect changes in the cost of living.

Current Costs
The Le Parisien article states that currently a notary’s office receives 2663 Euros on the sale of a 176000 Euro property. This 2663 Euro amount is part of the total fee of 12320 Euros collected from the Buyer of the French property.

The total sum of 12320 is mostly transfer taxes paid to the state (these transfer taxes were just increased this year). The official discussion of this change is to start in April 2014 according to the article.

Note: From the example above the notary’s office only received 21 percent of the total amount paid by the buyer.

Read the original article in French here

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French Property Investment: Increased Rent Reduces Income

French real estate investors need to be aware of the results of a new study by Edhec business school published in Explorimmo.

The study completed in February 2014 reveals that renting a property above the market price reduces the profitability of the French property over time.

The higher the rent is above the correct market price for the French property the lower the return on investment, according to the study. For example, if the rent is 20 percent more than the market renting rate the profitability is 4.23 percent compared to 4.47 percent if it was at the correct market rate.

The researchers found the reason for this reduced profitability is due to the increased risk of vacancy as tenants who are paying too much rent will leave the property when they find a better renting opportunity at market pricing. While the French property is empty the owner loses income. In addition, if the rent is too high there is a great risk the tenant may not be able to make a payment.

The researchers say the information requires more research to see if this is always  the case.

Read the original article in French here

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Four Ways To Find French Real Estate for Sale

If you are looking to invest in French real estate there are four ways you can find your new investment.

One
French Real Estate Portals and Site
There are many French real estate sites on the internet so like many people you can begin your research there. Some of the sites gather information from hundreds of real estate agencies so you can get a big picture view of what is available.

WARNING: Due to the existence of a mandate simple in France you may end up finding the same property for sale with many agencies. A solutions to bypass this problem is to ask a English speaking French real estate agent to help you find the property at the best price possible.

Two
Small French real estate ads
There are still many French properties for sale advertised in newspapers and free papers around certain towns. Typically, these are advertisements for properties also advertised on the internet but you can still take a look.

Three
French real estate agents
Working with a French real estate professional who will help you as your buyer’s agent can be very helpful indeed. This type of agent will have a network of agencies they work with and be able to show you properties that are not only registered in their agency.

WARNING: Not all agencies choose to co operate with each other so check with your English speaking French real estate agent and ask them how will they help you find your French property

Four
French Notaries
Once you are in contact with an English speaking French real estate agent you can ask them to put you in contact with a English speaking French notary who may have a client who is planning on selling a property due to a death in the family or divorce.

Details here to find an an English speaking French real estate agent in your area of choice.

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3 Things French Property Sellers Should Not Do

If you have a French property for sale and your French real estate agent is organizing visits for clients or agents with clients to visit your home then you need to respect the following guidelines to create a successful sale:

One
Do not Be Present
As much as you love your French property buyers never feel comfortable when the owner is around. They feel like they are disturbing the owner. As an owner you want to maximize the amount of time they spend in your home to see all the features and benefits.

In addition, if you are in the home, buyers do not have a chance to discuss all the pros and cons of the home. The best plan is not to be home and come back after the visits are finished.

Two
Do not Create Distractions
Freshly baked bread in the kitchen on the counter can be inspiring to help a buyer remember all the special features of a kitchen.

But avoid leaving snacks out for the buyers as they can be a distraction from their focus of absorbing all the features in the home. Make the home neutral and comfortable, avoid distracting music and leave the TV off.

Three
Do not hide Problems
If there are features that are not really ‘selling features’ of the home and they are repairs you do not want to fix then leave them be. Do not try to hide them. Some owners try to hide carpet stains or cracked tiles with furniture which once found makes the buyers very suspicious.

If you are a home seller we have a 50 step guide to help you prepare your home for sale. Go here for more details.

Contact us also to help you find an English speaking French real estate agent in France today.

Below you can get your free introduction ebook about French real estate mistakes to avoid

Get your FREE copy today

Request below via the sign up form. Just scroll down, add your email and click Subscribe

This request also entitles you to our biweekly ezine and you can unsubscribe anytime.

Videos/Free eGuide 10 Mistakes Made by French Property Buyers and Sellers

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Note: Details on our 110 Tip electronic French real estate buyer’s guide plus checklists is here.

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