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2021-04-01
Everything You Need To Know About Buying Property In The South Of France
Once the perfect property has been chosen, the process of purchasing and maintaining a property in France is something which can be difficult for international buyers to navigate without assistance. The complexity of the buying process itself coupled with the tax regulations for foreign investors is something which needs to be understood fully in order to guarantee a stress free experience.

Cap Villas has compiled a list of the most commonly asked questions asked by international clients about buying a property in the South of France, in order to provide you with the knowledge you need to find and enjoy your perfect property.

Can a foreigner buy a property in the South of France?

There are currently no restrictions on foreigners who wish to invest in a property in the South of France. Even if you are not a resident in France, you are welcome to buy a property, but you will need to have a French bank account. Some French banks will allow you to open an account under certain conditions. Offers differ from one bank to the next.

Once you learn that it is possible to buy a property as a foreigner, you will next question whether or not it is worth the investment.

Is buying a property on the Côte d’Azur a good investment?

The Côte d’Azur is one of the most regulated markets, making it a great place to invest in a property. Many foreign investors come to buy a property to eventually let, or turn the property into their second home. The Côte d’Azur remains a top destination for international travellers therefore making it a smart decision to invest in property in this sought-after part of the world.

How many days can you spend in France as a non-resident?

As a non-resident, you are able to stay approximately 180 days a year. However, you are only allowed to stay a maximum of 90 days at a time. This means you can come and stay for 90 days at most, then go back to a non-EU country. As an EU citizen, you can stay 183 days at most, without being tax domiciled.

How long can you stay in the French Riviera if you own property?

Once you own a property, you will nevertheless need to abide by the rules of a non-resident. You will be allowed on French soil for 90 days at a time, for approximately 180 days a year.



How much deposit money do you need to buy a house?

When you find your ideal property and decide to purchase it, you will have to pay 10% of the final offer as a deposit, which will be held by a notary. This transaction is made when you sign a
“Compromis de Vente”, allowing you time between the signing of the first contract and the final contract to withdraw your purchase proposal. As for French mortgages, a minimum of 15% to 25% of the property’s purchase price is required, however offers do differ depending on the bank.

Are property taxes high in France?

When thinking about paying taxes in France, it is important to note that the owner of the property is required to pay an annual property tax. The exact percentage varies from one city to another and depends on the size of the property. You will also be expected to pay two other taxes: la taxe foncière and la taxe d’habitation.

Will you have to pay the tax on real estate wealth (IFI)?

If your property is valued at 1.1M EUR or more, you will have to pay the tax on real estate wealth. The real estate wealth tax is an annual progressive tax, with rates from 0.5% to 1.5%. It is determined by applying a progressive scale to the taxable net real estate assets.

Taxable net value 

Applicable rate  

up to EUR 800,000 

0% 

EUR 0.8 million to 1.3 million, inclusive 

0.50% 

EUR 1.3 million to 2.57 million, inclusive 

0.70% 

EUR 2.57 million to 5 million, inclusive 

1% 

EUR 5 million to 10 million, inclusive 

1.25% 

Above EUR 10 million

1.50%

 There are still other taxes to be taken into consideration, as with many other countries.

Do you pay capital gains tax?

In France, you will always be expected to pay both social charges and capital gains tax. Capital gains tax is to be paid by the seller. The rate is 19% for EU citizens and 33% for non-EU, of the amount gained from the sale. Progressively the charges grow as the value of the sale grows too. For sales over EUR 50,000 there’s a surcharge of 2% and for sales over EUR 260,000 there’s a surcharge of 6%.

You may question whether or not you may be exempt from these taxes as an expat….

Do expats pay taxes in the South of France?

You are expected to pay all taxes once you reside or own a property in France. As an expat, your income, property sales and any other significant personal wealth will be taxed. As for your property tax, any person owning property on French soil, whether it be a local or a foreigner, has to pay two taxes: taxe foncière and taxe d’habitation. The tax d’habitation is to be paid by the person residing at the property, if the property is empty then the owner has to pay the tax.

As an expat in France, you will also need to pay notary fees (a notary is a person in charge of handling taxes). It is important to acknowledge their role.



What are notaries’ fees in France?

A notary in France is a property lawyer registered by the French government to ensure all property related documents are legally taken care of. The notary is required to keep track of and collect all property taxes and register all property sales transactions. The notary provides legal assistance to both the buyer and the seller. You will be charged 8% for the total sale of an older property, and 2-3% for the sale of a new property.

The fees include:

Emoluments du notaire

What the notary takes for themself

Emoluments de formalites

The registration and advertising fees

Frais divers

The miscellaneous fees

Droits de mutation

The property transfer tax

Contribution de sécurité immobilière

The tax owed to the state for carrying out the formalities for recording and publicising property-related transactions.



How can we help?

If you are interested in investing in the South of France, it is essential to engage the services of a trusted agent who knows the areas you are interested in, the properties available and the laws and regulations pertaining to purchasing and maintaining a property in France.
If you have any questions about how to buy property in France, or would like to begin taking the first steps towards finding your ideal property, please do not hesitate to contact us.