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There is a vast
difference between the detail that some buyers in France prepare to
and that of their counterparts. Look too deep for problems and you can
tie yourself in knots. Don’t do enough homework and come away
with a real headache. The ideal, as always, is between the two situations.
It is strange to find that purchasers
of property in France are always keen to negotiate a good price on the
house of their dreams, but then fail to appreciate that great savings
can be made by ensuring that they receive the best exchange rate from
£ into Euros.
We tend to shop around for most
things in life, but when it comes to currency, most people simply head
straight for the bank. The currency markets are notoriously volatile
: for example between December 2000 and January 2001 the cost of a property
in Euroland would have increased by over 6% in less than 3 weeks. Purchasers
can avoid these pitfalls if they use a specialist currency broker who
can explain the various methods of avoiding risk.
Some of our clients take our advice
and trade immediately whilst they are with us looking at property in
France. They are happy knowing that they have locked in a purchase at
say 200,000 Euros at £140,845 and that they are not going to get
a nasty shock at completion.
We recommend all of our clients
to use our chosen currency expert partners. They cannot see into the
future, but they can prepare you for it. It is possible to implement
monitoring systems to protect a minimum exchange rate. Depending upon
the size of a transaction the potential gain could amount to a very
tidy sum, but no matter what happens, you are always protected against
any negative exchange rate movements that could leave you out of pocket.
It is possible to lock into exchange rates when rates are especially
beneficial. Golden rule No 1 - Don't fall
into the trap of not getting the best deal for your money.
Many clients visiting have a very
good idea of what they are looking for, but don't actually communicate
that very well to the agent involved. In fairness, some agents are not
very good listeners, and some don't ask the questions in the first place
and take clients on a safari of everything on their books within a certain
price range.
At Allez Français we work
very differently, trying to establish from the outset what the clients
are hoping to find, so that we can fine tune our efforts and provide
them with property meeting their specification. This will involve knowing
whether clients wish to be rural, in a village, remote, or in a town
centre for shops. We establish how many rooms are needed for personal
use and how many for letting when that is a possibility.
It is important for us to know whether
clients want a property in a flat area or prefer something hilly. It
is just as important for us to be aware of what to avoid as well as
what to look for. We always discuss with clients which matters are must
haves and which are dreams, as nearly always with a purchase you have
to compromise upon something.
We prefer to show our client 4-5
properties during a day, and spend some quality time at the property
and with the clients as opposed to driving for hours and viewing 7/8
unsuitable properties. Viewing days can be long, we recommend to all
visitors to have comfortable clothing and footwear. The weather here
in the Poitou-Charentess can be very warm - frequently into the mid 30s
so we suggest a bottle of water in case we don’t get chance to
stop for refreshments. (We remember what it was like when we were looking).
We work with a number of different Immobilier firms (estate agents),
and are therefore able to provide clients with a wider selection than
many of our competitors. So, Golden rule
No 2 - give your agent a thorough briefing and don’t try to do
too much.
In addition to offering property
we also arrange mortgages for clients all over France, at rates from
a very attractive 2.75% currently, and offer to arrange this in-principle
ahead of a viewing visit, so that a potential buyer is in the strongest
possible position to negotiate for their purchase.
Mortgages are quite different in
France, and there is no point in wasting time viewing houses that you
cannot afford. Having a mortgage agreed in principle should not be a
problem for a vendor - he will be assured with the knowledge that you
will not use the ‘clause suspensive’ to walk away from the
transaction. Vendors will be far more reluctant to agree to sell or
negotiate on price if you are still to arrange the finance. So, Golden
rule No 3 is have your finance agreed in advance if it is needed.
During the visit you may see exactly
what you are looking for, or even precisely what you wish to avoid.
Do give the agent feedback whilst you are with them. We may be able
to adjust the viewings already set-up to exclude one that we now know
to be unsuited or include one that previously had been discounted, but
now becomes a real contender. The same logic applies to enquiries over
the internet before you depart. Give the agent feedback, build a conversation
by e-mail and be honest ! So Golden rule
No4 - is give feedback, and plenty of it.
Also, to smooth the process if you do find that ‘dream home’,
have some supporting documents with you. These should include Birth
& Marriage certificates, copies of passports, confirmation of your
currency dealer, a mortgage approved in principle letter if applicable.
Golden rule No 5 is to prepare your papers.
Finally, after the excitement of
the signing of a compromis, you have a 7 day period of reflection. Hopefully
you shouldn’t need to use that. Completion normally follows in
about 3 months. During this time you can set in place the other areas
that you need to work on, and these may include buildings and contents
insurance, Title Insurance, sorting our your E106 cover, removals etc.
Don’t leave everything to the last minute, there are always other
items to concern you without panicking to try to get cover at the 11th
hour. We offer policies with schedules in English to all of our clients
and with the support of a team to deal with administration and phone
calls in English as well. Golden rule No
6 is to have your insurances in place ahead of completion, and ensure
you understand the cover.
At the moment, we have a really
lovely renovated property with a gîte to renovate, plus stables and
small outbuildings. The property has its own pond, petanque pitch and
is located in a quiet group of 4 houses, but convenient for the A10
and A83 autoroutes. Priced at 218,155 € the property would cost
just over £150,000 at current exchange rates, but potential buyers
can take the unknown out of the equation by dealing with us to arrange
their currency on a forward basis. A drop in £ sterling to 1.35
could see the price rising to £161,600 - not a very nice surprise
for a new owner!
All of the services described are
available for buyers whether they are buying through our business or
not. In fact, we probably arrange currency for more clients of other
agencies, than for our own buyers. The important factor is to get the
best rates... and that is where we start.
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