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PROPERTY

The hidden costs of owning property in France

One thing that house-hunters in France often notice is the cheap property prices - those €50,000 châteaux for example - but there are quite a few hidden costs to buying and owning property in France.

Property in France is often cheap to buy, but comes with hidden costs
Property in France is often cheap to buy, but comes with hidden costs. Photo: Loic Venance/AFP

The French property market divides sharply into Paris and everywhere else. While the capital is one of the world’s most expensive cities to buy property in, in the rest of France, especially rural France, property can be surprisingly cheap.

But before you snap up a seeming bargain, there are some other costs to bear in mind.

Notaire fee

On top of the cost of the place you are buying, you will also have to pay a notaire fee and this can run into several thousand euros. The name is a bit confusing because the notaire who is handling your sale only keeps a small portion of this, the rest goes to the state so it’s really a one-off property tax similar to stamp duty in the UK.

The cost is worked out as a percentage of the sale price, with different rates for old or new properties – find the fee calculator here.

Professional fees

People can and do buy homes without any professional help (although it is a legal requirement to use a notaire to register the sale) but the buying and selling system in France can be complicated and is likely to be different to what you are used to.

Using an agent or financial adviser can save you money in the long run by pointing out potential pitfalls and ensuring that you have completed all the required paperwork correctly.

Property taxes

Once you own your property you will need to pay annual taxes on it. There are three taxes that concern property owners: taxe foncière, taxe d’habitation and the contribution à l’audiovisuel public.

READ ALSO French tax calendar – which taxes are due and when?

Taxe foncière is paid by the owner of the property, it is calculated based on the value of the property but rates vary widely between different areas. Bills of €900 a year are not unusual.

Taxe d’habitation is paid by the occupier of the property, so if you own your own home you pay both taxe d’habitation and taxe foncière. Taxe d’habitation is in the process of being phased out, already lower earners don’t pay it and it will be gradually reduced over the next four years for higher earners. Second-home owners, however, will continue to pay it.

Contribution à l’audiovisuel public is the French TV licence, and most householders have to pay this, even if you never watch French TV. It’s currently €138 a year. There are some exemptions, however.

You may also get a bill from your local commune for services like waste collection.

Utilities/insurance

Obviously, you will need to pay for utilities like gas and electricity and insurance for your property. Utility prices are set on a monthly basis by the government, so there are fewer options to shop around and get a better price, although there are some deals on tariffs that can save you money.

Renovation

If your new place is very cheap, it’s likely to need some renovating.

Within the French countryside there are quite often cheap and somewhat ramshackle old properties to be found. Part of this is for cultural reasons (French buyers often prefer newer places and sometimes old family properties are left empty because of France’s complicated inheritance laws) but if a place is really cheap there might be a good reason for that.

Surveys are less common in France, but if you’re buying a place that needs a lot of work it’s strongly advised to get an expert view on whether it has any major structural problems before you start work.

Once you begin you’re likely to find that building materials, DIY goods and tradesmen costs are all more expensive than you are used to (and post-Brexit rules mean that bringing over things like bathroom suites from the UK is now much more difficult).

READ ALSO ‘Double your budget and make friends with the mayor’ – reader tips on French property renovation

Doing a building project in France also requires a lot of permits, forms and planning permission, so unless you are prepared to spend a lot of time ploughing through French bureaucracy you may also need to pay someone to complete the paperwork for you.

Bank account

If you’re moving to France you will need a French ban account, and even if your property is a second home you will find it much easier to pay things like tax and utilities if you have a French bank account.

READ ALSO Everything you need to know about setting up a French bank account

Banks in France charge an annual fee of around €50 to have an account, but setting one up can come with its own problems for foreigners, particularly Americans thanks to FATCA.

Health insurance

You will need to make sure your medical costs are covered if you fall ill or have an accident while in France, how this is done depends on your nationality and residence address – full details here.

Moving costs

If you’re not already in France, there are also some costs attached to an international move.

Visas

If you don’t have an EU passport and you want to spend more than 90 days in every 180 at your French property you will need a visa. Visas have costs attached and – if you don’t intend to work in France – you also need to be able to prove a certain income level.

EXPLAINED: How to apply for a French visa

Pets

If you’re bringing pets with you and you’re coming from outside the EU, your cat, dog or ferret will need inoculations and an Animal Health Certificate to enter France. If you intend to live here, then your pet can get an EU Pet Passport once you’re settled, but second home owners will need a new ACH for each pet and each trip.

Property transport

If you’re moving, you will likely want to bring your worldly goods with you. The costs of shipping furniture etc obviously varies dramatically depending on where you are coming from.

For people moving from the UK who plan to just load up a van and drive themselves and their stuff over, remember the new post-Brexit rules on bringing in goods worth more than €430.

The cost of transport such as ferries and planes varies a lot depending on the time of year, and if your move involves a long drive through France, don’t forget to factor in toll fees for the autoroutes, which can top €100 in total if you’re travelling a long way.

Post-move admin

Moving to France involves a lot of admin and registering for things like residency, healthcare and social services. As well as the time of filling in forms, expect to be asked for certified translations of some documents, which are charged at around €40 per page. Also keep some small change handy for the photobooth, you’re likely to need to supply several passport-sized photos as you go through all the formalities.

Member comments

  1. “Bills of €900 a year are not unusual.”
    Which decade and area does the writer of this article live in.😛

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MONEY

Reader Question: Why did my French electricity bill increase by more than 4%?

The French government has capped electricity prices rises at four percent - but as with many French rules, there are certain exceptions.

Reader Question: Why did my French electricity bill increase by more than 4%?

Question: I read in the media that electricity prices in France are capped at four percent, but I just got a letter from EDF telling me that my bill is going up by almost 20 percent – is this a mistake?

The French government’s bouclier tarifaire (tariff shield), froze gas prices at 2021 levels and capped electricity price hikes to four percent – it remain in place until at least the end of 2022.

However, there are some customers who will see increases to their bills of more than that – here’s why: 

The regulated tariff rate

The French government involvement in price-setting doesn’t just happen during periods of energy crisis, normally regulated tariff prices are updated twice a year: usually on February 1st and August 1st.

Typically, this value is calculated by the CRE (commission de régulation de l’énergie) and it is based on several different factors, which are explained on this government website. These tariffs proposed by the CRE are then subject to approval by the ministers in charge of energy and the economy.

READ MORE: EXPLAINED: Why are French energy prices capped?

These affect the state-owned Engie (formerly Gaz de France), the mostly state-owned EDF and some local distribution companies. Around 70 percent of people in France get their electricity from EDF but other suppliers do exist in the market.

These alternative suppliers, like Direct-Énergie, Total Spring or Antargaz, are free to charge more – but don’t usually charge much above the EDF rates for obvious commercial reasons.

Basic rate

The government-set limit in price rises refers only to the basic rate (option base) for electricity.

This plan represents over 80 percent of the 32 million households connected to the electricity grid in France. So, there is a good chance you might be subscribed to this without even realising it. 

If you are on the basic tariff rate, your bill will not increase by more than four percent this year.

Other tariff options

However, other options for electricity bills do exist, including off-peak rates, green deals and fixed energy prices for a certain period.

Typically people who sign up for these will have been paying less for their electricity in the preceding months than those on the base rate.

However, there are certain special deals that are not covered by the four percent cap, and some users will find that their deal period has come to an end, they are then shifted onto the base rate – which is likely to represent a price increase for them of more than four percent.

It’s little consolation when faced with rising bills, but you will likely have been paying significantly less than customers who have been in the base rate for the past few years.

READ MORE: French government to continue energy price freeze until at least 2023

Kilowatt price

Because most electricity price plans are bafflingly complicated, the easiest way to compare is to look at the price per kilowatt-hour.

Your electricity bill consists of a fixed part, the monthly subscription (abonnement) and the variable part, which depends on the quantity of electricity consumed (in euro per kilowatt-hour, kWh). The latter part is what is concerned by the tariff shield of four percent.

Here is an example of what that might look like:

The mid-August base rate price per kilowatt-hour is €0.1740/ kWh, so if you’re with EDF they cannot charge you more than this rate.

Other EDF plans charge significantly less than that – for example the Vert Electrique Weekend deal has been charging €0.1080/kWh on weekends and €0.1434/kWh on weekdays. 

Bill rises

With the tariff shield, the average resident customer on the base rate will see a €38 rise on their bill this year, while professional customers will see an average of €60 rise. 

Without the tariff shield, electricity prices per residential (non-business) customer would likely have increased an average of €330 a year, according to the CRE.

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