Investing in France: advantages, costs and procedures

The French lifestyle is famous throughout the world. Thanks to its luxury products, gourmet food and famous monuments, France tops the list of the most attractive countries in the world both in terms of tourism and real estate. Its Haussmann architecture, townhouses and châteaux are extremely popular across the globe. Whether it is a property in the mountains, Normandy, Paris or the French Riviera, foreign buyers have certainly got it right and see French real estate as a safe investment, particularly in periods of political instability. 

Do you want to invest in French property? Our teams at Engel & Völkers have 40 years’ experience in exclusive real estate. Our experts will help you uncover the real estate gem you’re looking for and advise you on specific tax and administrative details, depending on your personal circumstances. 

The advantages of investing in French real estate for foreign buyers

Since the pandemic, the luxury real estate market has never been in better shape. Buyers are opting for larger properties, with more space, that are easily accessible by plane or train, and less than two hours from Paris. Larger cities have been largely abandoned in favour of other regions where you can buy a more sizeable property with genuine outdoor space for a more affordable price.

 Whatever your preference, whether a contemporary-style building by the sea in the South of France, or a property with old-style charm in Normandy, France has many exceptional properties which are highly sought after by an exclusive clientèle. However, larger towns and cities have not completely lost their appeal: prices have fallen slightly and the property market is still booming with places like Paris and Lyon regarded as safe investments. 

In France, the average price per square metre hovers around the 3,000 euros but in seaside areas, like Saint-Tropez or in the mountains where chalets often sell for more than the price of a Paris flat, average prices are much higher.

Taxes and fees payable by foreign buyers  

When you buy a property in France as a foreigner, you need to consider not only the selling price but other financial and tax implications related to this type of investment. You will, in fact, have to pay a  number of different fees, including registration fees which amount to roughly 7% of the selling price. This sum is paid to the notary in charge of the sale who collects it on behalf of the French government. You also need to factor in local taxes, including property tax and occupancy tax if you are buying a second home. 

You also have the option of setting up a company to buy your property. However, Notaires de France state that if you are a non-resident foreign buyer, there are important inheritance implications that you should be aware of. And the following, in particular: “in the event of the purchaser’s death, the property is not subject to French law. Since 17th August 2015 (the date on which the European Regulation of 4th July 2012 came into effect), when it comes to inheritance, the law of the country in which the property is located no longer applies; who inherits the estate is governed by the law of the country where the purchaser was habitually resident.  And it is this country that decides who can inherit and how the estate is taxed. It is worth noting that members of the European Union, and nationals of foreign countries who have signed an agreement with France, are covered by special regulations (bilateral agreement, Hague Convention, etc.).”