Acquiring real estate in Europe
Expatriation, vacation home, investment ... Real estate investment in Europe is complicated. This operation involves French law and international law regulations.
Is it risky to purchase real estate in Europe?
The single currency and free movement of people, goods and capital now make it easier to acquire property, outside our borders. But such a purchase is complicated. Europe is an economically and politically secure area, but there are differences in terms of legislation between countries. Acquiring property in such conditions can lead to important issues in international law, which is why notaries advocate to build a legal Europe.
What are the main challenges of such an operation?
You must properly plan out your project, to assess the advantages and disadvantages of such an operation:
- financial cost (mainly take the exchange rate into account, in the event of an acquisition outside the euro zone),
- administrative and legal procedures,
- applicable taxation mainly in the case of property rental or resale with capital gain,
- risk assessment in the event of resale or death, etc. ...
How to secure an acquisition properly?
Each country has its own rules. In Sweden, for example, the transaction is carried out by a real estate agent. In other countries, you may need to hire a local notary or lawyer.
Thus, before carrying out an acquisition, it is key to get in touch with the French consulate and local associations such as the local French Alliance, to get practical information. You will need to find a local adviser who speaks French and, if need be, a translator.
How to finance this acquisition?
It is possible to get a loan in France for a property acquisition abroad. However, it’s important to resolve the guarantee issue. A French bank will find it difficult to grant a loan with a mortgage on a property abroad.
This is why, the person borrowing the money will have to give a guarantee on a property which is located in France or a life insurance pledge , for example. It may also be easier to borrow directly from abroad. But once again, one needs to be careful.
What is the impact on spouses or heirs?
These acquisitions can lead to significant issues, in terms of private international law. It is important to discuss this with your notary, in terms of the family situation. In England for example, the matrimonial status of the community does not exist for spouses. Therefore, any couple acquisition shall be carried out through joint possession. Moreover, it is important to question the whereabouts of inheritance for this property, in the event of a death and the reason to drafting a will .
Buying property in Europe: the website
The website "Buying real estate in Europe" - www.jachetemonlogement.eu - provides information sheets, in French and English, explaining how to buy real estate in countries with the notarial system, ie 22 countries within the European Union.
- My landlord has issued me by bailiff leave for sale with indication of a net selling price. The real estate agency in charge of the sale claims me €30,000 agency commission. Do I have to pay them?
- I want to buy an apartment. My bank refused my loan. Can I ask the seller a staggered payment of the selling price?
- I'm selling my main home acquired 5 years ago. The notary claims a missing diagnosis: ESRIS. It was not provided to me 5 years ago. Am I obliged to have it done?
- I signed a reservation contract for the acquisition of a property on plan. This contract has been notified to me for more than 1 month, can I retract?