Buying property in Paris: A guide for investors
Paris is the capital of France, but it is also a historic and very charming city with many opportunities. It is one of the most attractive and visited cities in the world. It is a city to consider when investing in real estate. Whether you want to rent or buy a property, you will have great opportunities.
Indeed, each district of this city has great tourist attractions, embassies and many others. In addition to its tourist appeal, the city of Paris offers a high return.
Given all these assets, Paris is a good place to make any real estate project a reality. Thus, you can trust Guest Ready, a company whose reputation and fame are known to all inhabitants of the city of Paris.
So, how can you buy a property in Paris with GuestReady?
1. What are the requirements for buying a property in Paris?
To buy a property in Paris, it is important to prepare your real estate project step by step in order to avoid making mistakes. A good preparation guarantees the success of the property acquisition. Here is the procedure to follow when buying a property in Paris.
Define the objectives of your real estate project in Paris:
The first thing to do is to define the real estate purchase project, which consists of identifying the contours and objectives. You should know that there are many different types of property projects.
What is your budget for your property project?
The second step is to determine the purchase budget. This is a very important step in the process of buying a property in Paris. It is from this step that everything starts. The estimated purchase price is based on your income and savings.
Buying a property requires a large investment. Sometimes this can lead to a mortgage. In this case, you will have to define your borrowing capacity, which depends largely on your income.
To estimate your budget, it is important to take into account your income, your down payment, the bank’s conditions and the loan period.
Visit the properties:
The third step is to visit the properties. Once you have estimated your purchase budget, you must now start looking for the property. This can be a lengthy process if you want to find the perfect property.
To make it easier for you, you can contact an estate agent such as Guest Ready. After that, there are a number of details to consider before you buy. You need to consider the price, the neighbourhood and its dynamism, the condition of the property, and the documents to be read, such as the property diagnosis.
Making an offer:
You will need to make an offer. If you have a property in mind after the visit, you should now submit an offer.
You can submit the offer in writing and this is recommended. But to negotiate, you must take into account the average selling price in the city of Paris or the arrondissement in which you wish to acquire the property.
Signing the compromis de vente:
The fifth step is to sign a compromis or promesse de vente. After negotiating and finding common ground with the seller, it is time to sign a compromis.
In this case, you have the choice between the compromis de vente which is a bilateral contract, where the seller certifies to sell you the property and you agree to buy it.
If the property no longer suits you, you have 10 days to cancel the offer without justification. After this period, it will be difficult for you to cancel the offer to purchase. The promise to sell only concerns the seller.
This is a unilateral promise to sell. However, the buyer must pay 10% of the sale price to secure the property. If he subsequently acquires the property, the amount will be deducted from the remaining amount. But if the buyer gives up, the seller keeps the amount as compensation.
Look for a source of finance:
The sixth step is to look for a mortgage. In this case, you have between 45 and 60 days to find the financing for the purchase of the property. You must be prepared to defend your property project in front of the bank in order to receive a mortgage.
The documents you need to provide include salary slips, bank statements, tax returns and many others.
Signing the loan offer:
The seventh step is to sign the loan offer. Before the end of the 45 or 60 days, you may receive several offers. When you receive the loan offer, you have 10 days under the Scrivener law to consider the loan offers and the different clauses.
Signing the deed:
The eighth step is to sign the deed. This signature must be done in the presence of three parties: the buyer, the seller and the notary.
And you must pay the notary’s fees, the purchase price of the property and the guarantee. After the signature you will receive the keys which mark that you are the owner of the property.
Finally, other steps follow such as the organisation of the works if you want to renovate which requires a budget that should not be neglected and finally the stage of moving and integration in your new property.
2. How much tax do I have to pay when I buy a property in Paris?
When you formalise the purchase of a property, you have to pay certain fees that the notary will calculate and deduct during the purchase process:
Agency fees:
when you use the services of a real estate agency, you will be able to pay agency fees of between 3 and 10% of the value of the property: but these are generally payable by the seller.
Transfer duties:
this is a tax collected by the notary when the deed of sale is signed, which is paid to the tax authorities. It is generally included in the notary’s fees.
Notary’s fees:
this tax includes the notary’s fees, disbursements and transfer duties, but also the taxes that the notary must collect, such as the land registration tax (TPF)
Loan registration fee: this tax applies when you take out a mortgage to buy the property.
Apart from this tax, there is no tax to pay after the purchase of a property. However, you must pay the property tax every year.
Taxe foncière sur les propriétés bâties (TFPB):
after buying a property in Paris, you will have to pay the taxe foncière sur les propriétés bâties. The tax applies from 1 January of the tax year. You will have to pay this tax all year round during the year of acquisition of the property.
3. How do I find a property in Paris?
To find a property in Paris, it is important to search for property in the arrondissements to find the rare pearl via the classified ads on the internet. You can also contact an estate agent who will make it easier for you to find your property.
4. Where to buy property in Paris?
Property prices are rising and reaching record highs. However, this will not stop the market from increasing in value as buyers continue to seek out properties for both the long and short term. So where to buy property in Paris?
Notre-Dame
Located in the 4th arrondissement of Paris, the Notre-Dame district is a central and authentic area in the heart of the City of Light. It has a tourist character thanks to the Notre-Dame cathedral and attractive architecture with stone houses.
To get around, you have a metro which is a fast means of transport. If you prefer vehicles, then give priority to the main crossroads. If you want to buy a property in the area, you should expect to pay an average of €14,000.00 per square metre. This is a price commensurate with the prestige of the area.
Le Marais
The Marais district of the 4th arrondissement has plenty of arguments to seduce buyers. Tourists flock to this prestigious district. It is a historic district with many monuments and medieval-style buildings, all in a cosmopolitan atmosphere. The average price for a property in this area is €13,570.00.
Montmartre
The Montmartre district is an area that is both iconic and unmissable. It is a great place to live, whatever the season. Very charming and pleasant to live in, it is very popular because of the Place des Abbesses or the Sacré Coeur.
There are several world-famous cultural places such as the Moulin Rouge or La Cigale. These are mythical places and investing in them would be an excellent idea. The average price for a square metre in this area is €11,000.00.
Saint Germain L’Auxerrois
The Saint-Germain L’Auxerrois district is a very popular area. Dynamic and urban, this district of the 1st arrondissement has several green spaces. Economically, it is a district which has several shops.
For transport, there are two metro lines. You can also find self-service bicycle stations. If you want to buy a flat in this area, you should expect to pay an average of €14,380.00 per square metre.
Halles
Les Halles is a district of the 1st arrondissement. It is a district which attracts many visitors since it has several monuments. It is a district which does not know the crisis and consequently an ideal place to invest.
Moreover, it is a district which has a margin of progression in real estate. It is therefore an opportunity to seize. However, you should plan on an average of €11,491.00 per square metre.
5. What are the pitfalls of buying a property in Paris?
When you decide to buy a property in Paris, there are several pitfalls to avoid.
Be aware of the location:
The first trap is not to pay attention to the location of the property. However, the location is of paramount importance. It allows you not to regret your choice.
Find out about the assistance available for buying a property in Paris:
The second trap is not applying for the Paris Housing Loan. Thanks to the Prêt Paris Logement 0%, you will be able to claim for the purchase of the property.
Taking into consideration urban planning projects:
The third mistake is not to take into account the urban planning projects. If you do, it is possible to come out ahead with redevelopment projects which would increase the value of the property, or you can make it lose value.
Condominium charges:
The environment is important, especially when the property is in a condominium. It is important to be aware of the financial situation of the co-ownership, the state of the building and the level of charges which have a direct influence on the price of the property you wish to buy in Paris.
Beware of real estate scams:
You should take precautions when you want to buy a property in Paris such as:
- Requests to pay money before meeting the person.
- If the person asks you to send administrative documents.
- Too attractive a price.
- The address of the property is not accurate.
- Lack of a photo.
6. Why buy property in Paris?
Investing in Paris is an opportunity that should be seized for various reasons. The first reason to buy a property in Paris is to benefit from the opportunities of the capital. Paris has several advantages, including a dynamic local economy, a good geographical location and a crossroads for several European countries.
The second reason is to anticipate development. Paris will continue to attract people and the suburbs of Paris are experiencing significant development, which is supported by the Greater Paris project. The third reason is that by buying a property you are guaranteeing yourself a patrimonial investment.
7. Is it worth buying property in Paris?
Investing in property in Paris is generally considered a sound decision. Renowned as a city of dreams, Paris not only offers a rich cultural and historical backdrop but also shows a strong potential for investment returns. Although acquiring property in this iconic city can be costly, it typically proves to be profitable over time. The real estate market in Paris has been experiencing a steady growth, with property prices rising by an average of 5.8% annually. This consistent increase in value highlights the enduring appeal and financial viability of owning property in the French capital.
8. Can foreigners buy property in Paris?
Foreigners can buy property in Paris. Indeed, there are no restrictions. Although the procedure is long and arduous, you should know that you can indeed buy a property in Paris. According to data from notaries in the Ile-de-France region, the proportion of foreigners who bought a property in the French capital reached 8.1% in 2019. This trend is supported by a favorable investment climate and a robust real estate market that attracts international buyers looking for both residential and investment opportunities. Potential buyers should be aware of the need for legal and financial advice to navigate the intricacies of the French property market effectively.
9. Is it the right time to buy a property in Paris?
Determining whether it is the right time to buy property in Paris depends on various factors, including market conditions, personal financial circumstances, and future market predictions. Currently, Paris’s real estate market is experiencing a unique situation:
- Decreased Prices in Central Areas: Prices within the historical center of Paris (intra-muros) have reportedly decreased. This could be seen as an opportune time for investment, especially if you are looking for property in prime locations at potentially lower prices.
- Increased Suburban Prices: Conversely, property prices in the suburbs have increased, likely due to a shift in buyer preferences for more space and better affordability outside the central city.
- Economic and Social Factors: The impact of ongoing social, economic, and health crises must also be considered. These factors can influence market stability and future property values.
- Long-term Investment: Paris, with its enduring global appeal, historical significance, and cultural richness, generally remains a strong long-term investment. Property values in Paris have traditionally appreciated over time, despite short-term fluctuations.
- Personal Financial Readiness: It’s crucial to assess your financial situation, including your ability to finance a property and withstand potential market fluctuations.
10. Investing with GuestReady in Paris
Guest Ready is an international company specialising in short and mid-term rental management. It helps investors to acquire a property safely and as quickly as possible. We have qualified and experienced staff who are ready to listen to your needs.
It also offers several short-term services such as:
- 24/7 communication with guests in several languages;
- Reservation management;
- Online listing optimization;
- Cleaning services and maintenance coordination;
- Assistance with decoration and professional photography;
