New Build
New build property can prove to be very attractive, with features such as guaranteed modern comforts, double glazing, central heating, low maintenance and a construction guarantee.
They are located in desirable places offering a good quality of life or holiday and the added plus of hassle free rental on selected developments. When people choose to purchase a new build property, they buy 'off plan'. Developments aimed at the investor generally sell very quickly which shows that this type of property market is usually fast moving.
Buying Off Plan (VEFA-Vente En Etat Futur D’Achevement).
To buy off-plan means to buy a brand new home direct from the developer. When you choose and reserve a property within a development you then must wait for it to be built. Building will start when most of the development has been sold.
New build properties are often cheaper than resale and payments are made in stages. Advantages include price, brand new fixtures and fittings, ventilation and heating systems, insulation, up to date products, low deposit and registration fees and being exempt from property tax (Tax Fonciere) for two years from the 1st. Jan. following the completion date.
1. When looking at the plan of the development you choose your property. It is always wise to visit the site checking location and aspect.
2. Prices are non-negotiable.
3. You sign a reservation contract and pay a 5% deposit which is held by the Notaire.
4. Work will usually start when most of the properties have been reserved.
5. After the deposit has been paid, the buyer has a 7 day period whereby they can withdraw.
6. After the 7 day period the contract becomes legally binding and a deposit will be forfeit if the buyer decides not to go ahead with the purchase.
7. When the foundations are laid a payment of around 25% of the total purchase will be requested, sign at the Notaires office and pay his 2-3% fee.
8. You will now own the property officially.
9. Only when the property is completed do you have to insure it, as the property is covered by the developers insurance and guarantees.
10. As building moves on, further payments will be requested and you have to check each stage.
11. If you need to take out a mortgage on the property, the mortgage company will take over the payments once you have paid your contribution.
12. A number of lenders offer deferred payment mortgages for off-plan buyers.
13. Five per cent of the total price is usually held by the buyer until the final inspection visit and all faults found have been rectified.
14. Once the buyer is happy with the property and the final instalment payment is made, only then will they be handed the keys.
15. It can take 12-18 months from signing a reservation contract to receiving the keys to a completed property.
Advantages of New Build.
a. No stamp duty to pay.
b. Only 2-3% of the Notaires fees.
c. Only 5% deposit on signing reservation contract.
d. Stage payments over the period of construction.
e. Ten year guarantee on construction.
f. Developer backed by bank guarantee.
g. Low maintenance.
h. Easy to sell on the French market.
i. Easy to rent out with communal facilities
j. Good investment potential.
k. Social aspect and security of living on a development.
Whether it is for an investment or a holiday home we look forward to assisting you in the future.
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