The Pitfalls of Private Sales:
On the face of it, both selling and buying property privately in France makes sense. Agency fees tend to be far higher than in the UK; often around 10% (of the purchase price) for houses at the cheap end of the market and 5% or more for properties in the luxury price bracket. For sellers, avoiding agency fees makes their homes better value for money when it comes to marketing them, while for buyers it obviously makes the purchase price considerably cheaper: saving perhaps 5,000 euros on a barn priced at 50,000 to the owner, or over 40,000 euros on a château for sale at 800,000.
Research suggests that approximately 50% of French sellers try to sell privately, ‘de particulier à particulier’. Homemade ‘à vendre’ signs – often bilingual – can be seen throughout French towns, villages and open countryside. Local newspapers are also a popular advertising point for private house sales. British house sellers in France often use property magazines, websites and ex-pat publications for private sales.
I would suggest that the advantages of selling privately are purely financial. What are the disadvantages, though? Obviously, all the publicity and marketing will have to be paid for by you: taking out private ads, constructing a website or webpage etc. All the visits will have to take place with the owners (or a friend/neighbour) acting as tour guide. The main disadvantage of this is that there is a natural tendency to either oversell or indeed undersell the property. Talk it up too much and prospective buyers will be suspicious as to why you could possibly bear to part with your dream home; emphasise all the negative points and you will immediately put clients off. Research shows that most buyers prefer to view houses (for the first time) with the owners absent. If it is a second home and you are not available, is the person showing people around able to answer all the clients’ questions? Also, it is sod’s law that people will phone to request a visit or further information the moment you are out shopping or away on holiday. Will they ring back? Quite possibly, but in a buyers’ market there will be plenty of other interesting properties for them to look at.
Quite often, these sellers have received valuations from a number of agencies who have offered to market the property at the CURRENT MARKET VALUE. It is human nature, though, that many sellers believe their home to be worth far more than that; perhaps they know someone who knows someone who recently (allegedly) sold their similar home for “far more than that”. The ex-pat bush telegraph is notorious for exaggerating the prices achieved by fellow Brits selling. The same is true among rural French people. However, most vendors are not professionals, and often choose to sell privately in an attempt to sell WELL ABOVE THE CURRENT MARKET VALUE. Buyers beware, particularly if they are travelling over to visit just one property. It may well seem great value for money, compared to a house in Basingstoke, Birmingham or Bradford. But how does it compare to similar properties for sale in the local agency window? Also, it is worth bearing in mind that in the current, quiet market place, there is often a marked discrepancy between the advertised prices and the price accepted by owners who need to move on.
For buyers, some may be wary of estate agents, who often have a certain notoriety, on both sides of the Channel. However, a respectable estate agent can actually save you both time and money: pointing out the negative points of a property which might enable you to discard it before setting off to visit; telling you whether they think a house offers value for money and whether the owners are ‘open to offers’; providing the real reasons as to why a property is for sale, rather than the owners’ cobbled version. When it comes to making an offer, a professional negotiator is trained to do exactly that. Some agencies will provide a translation of the various legal documents involved in the purchase of a French house, as well as regularly updating you during the buying process. They can advise you on adding ‘suspensive clauses’ to your offer if you are planning on buying with a mortgage or want to convert an outbuilding. They will apply for outline planning permission for you, where necessary. Without inside knowledge of the local French property market, a very good understanding of both the French language and the buying process, there are plenty of pitfalls involved in private purchases.
My business partner once observed that house purchases often bring out the worst in people, both sellers and buyers: lies, information withheld etc. Agencies are not fool-proof but do provide a buffer, taking much of the tension and stress out of the situation. This buffer comes at a price, as I have already acknowledged. However, circumventing the professionals can be a risky business.