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In
France buying a property Leasehold is not an option. Everything
MGM build from the smallest apartment to the largest chalet
or villa can only be purchased Freehold.
Obviously
if we are talking about an apartment it would be share
of the freehold, which would be calculated according
to the size of your property as a percentage of the total
floor area and grounds within the complex. This figure would
then denote the percentage that you would pay towards the
annual service charge for the maintenance of the building
and grounds.
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All of MGM’s properties are sold fully finished.
This means that they come complete with fully
fitted kitchens including integral appliances,
fitted bathrooms, tiling to walls and floors and paint or
other specified finish to all other surfaces (according to
the technical specifications of the building).
The price you are quoted is not subject to any additional
costs (unless you wanted to make changes to the plans or specifications).
Properties sold under the Leaseback Scheme are sold fully
fitted, equipped and furnished (see Leaseback Scheme presentation).
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a.)
The French notary fees & stamp duty
These will be approximately 2.5 % of the purchase price
for new property, as opposed to 6/7 % for resales.
b.) UK Based Solicitors/Notaires
Some clients choose to use a UK based solicitor in addition
to the French Notaire to help guide them through the purchase
process. Their role is purely to advise and inform as it is
only the notaire that can undertake the conveyancing. Fees
vary depending on the solicitor and the nature of his involvement.
Expect to pay from £500 to £2,000 for a purchase price in
the region of €150,000.
c.) Mortgage fees
If a mortgage is raised on the property in France it would
have to be through a French bank, in which case there is a
tax of approximately 2% of the mortgage amount. Funds raised
on UK properties via mortgages from UK banks will be treated
as straight cash payments.
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LOCAL
TAXES & RUNNING COSTS
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a.)
Taxe foncière
The
owner of the property is liable for this national tax.
b.) Taxe d’habitation
The occupier of the property is liable for this local tax.
If the property is leased for a long term then the tenant
is regarded as the occupier otherwise it is the owner.
c.) Service charges
The owner of the property is liable for the maintenance charges
relating to the building and grounds. Where the freehold is
shared as with apartments, costs are divided amongst the owners
and calculated according to the size of each property.
d.) Insurance & utility bills
The
building insurance is included in the service charges. The
occupier of the property is liable for the contents insurance
and the utility bills (water, electricity, gas…). If
the property is leased for a long term then the tenant is
regarded as the occupier otherwise it is the owner.
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There
are three options available:
a.) Private rentals (short term or
long term)
This option requires time and personal involvement. Consideration
should be given to the how the property would be marketed,
cleaned and maintained as well as who would be responsible
for handing over the keys and checking the inventory.
b.)
Rentals through a local agent (short term or long term)
This
solution is far more realistic and very often chosen. The
French agents fees vary according to the work required by
the client (research of tenants, cleaning, inventories, linen
supply …). As a guide line an average fee for a full
management for short term letting is in the region of 25%
of the gross rental income.
C.)
Leaseback Scheme
(see
Leaseback Scheme information)
Which
ever you choose the rental income has to be declared to the
French tax authorities. In most situations, the rental income
is not taxed as many charges can be offset (mortgage interests,
local taxes, service charges, managing agent fees, …).
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