The first sales contract
Once the notaire has been selected the first sales contract, or compromis de vente, will be drawn up. This is the first stage of the sale and the point at which you will lay down your deposit. As soon as the vendor signs this agreement they are bound to sell you the property at the agreed price. Buyers are not immediately committed to the sale upon signing and have a 7-day “cooling off” period to withdraw from the purchase without penalty. The 7 days will only start once both buyer and vendor have signed the compromis de vente and you have been officially notified of the start of the cooling off period.
This system works extremely well and prevents a “sale chain” from building up. Once the vendor has signed the contract they are unable to accept a better offer from another buyer, so the problem of gazumping does not occur. Likewise, the vendor is protected because the buyer has committed to the sale and cannot attempt to renegotiate the price closer to the time of purchase.
Your deposit is likely to be 5-10% of the sale price of the property, therefore before coming out to France on a buying trip you should ensure that you have this money readily available. The deposit will be held by the notaire until the sale is complete. If you choose to withdraw from the sale without a pre-agreed or valid reason beyond your 7-day cooling off period the deposit will not be returned to you. You should never pay the deposit directly to the vendor of the property.
The compromis de vente will set out the terms of your agreement with the vendor and will cover the following type of information:
The personal details of the buyer and the vendor
The exact address and a detailed description of the property, including ski lockers or private cellars and parking spaces
Statements confirming whether or not there is any asbestos or lead piping in the building (see “reports” information below)
In the case of apartments, a statement confirming the exact surface area in m2 (see “reports” information below)
Whether the sale is to be funded by a loan, the proposed loan terms and timings for the loan application
The agreed sale price of the property
The notaires fees and taxes to be paid
If a loan is to be used to fund the purchase, the estimated loan registration costs
Any additional costs to be paid, such as outstanding building or monthly charges in the case of an apartment
The value of the deposit required
The presence of any servitudes or rights of way which may affect your decision to buy the property
Any get-out clauses “clauses suspensives”, which enable the buyer or vendor to withdraw from the sale without penalty e.g. the sale is dependant on planning permission being granted or a loan application being approved
A provisional completion date and the latest date the sale can complete
Additionally a number of reports will be attached to the contract. The vendor is responsible for organising an independent expert to check the property and provide signed reports to cover the following:
The presence or otherwise of asbestos in the property
The presence or not of lead in the pipes (older properties only)
Exact square metre surface area of the property (in apartments only)
A local “risk report”, which shows the risk to the property of natural hazards such as avalanche, flooding, earthquake and so on
The first sales contract