How to sell a property in Nice

Estate agencies in France are very tightly regulated. Their commission rates are by law are displayed in the window, and you should expect it to be 5% of the selling price (~4% commission + 20% VAT). It may be more if the property is priced under €150,000. When engaging an agency, there are two decisions you need to make: whether you give the agency an exclusivity, and whether you reserve the right to sell the property privately.

The contract is known as a "mandat", and the two types are known as a "mandat exclusif" (exclusive) and a "mandat simple" (non-exclusive). A Mandat gives an estate agency the right to publicise a property, for example put the details of a property onto a web site, or display it in the window. It details the responsibilities of the seller, the principles ones being providing correct information and allowing reasonable access to the property. Usually there is a clause obliging the seller to accept an offer if it is at the full asking price. It also details the responsibilities of the estate agency, the main one being to pass on any offers directly to the owner with minimal delay. The maximum legal length a Mandat can be is 1 year, after which it expires automatically. The maximum legal length an exclusive Mandat can be is 3 months, if it is longer then it reverts to a non-exclusive Mandat for the remainder of the duration.

A Mandat can be cancelled by sending a registered delivery letter giving notice. The notice period will be in the Mandat, and is around a fortnight. Usually there is a clause that the Mandat cannot be cancelled within the first three months. The reason for this is that the estate agency will invest a lot of money at the start, such as hiring a photographer and purchasing in advance slots in magazines and newspapers. This clause allows them a reasonable delay in which to recoup their investment.

Although there is a service called the MLS in Nice, it is nothing like the MLS (Multiple Listing Service) in the United States. It only has a relatively small percentage of listings available. Inter-agency listings are spread amongst MLS (also known as Emulis), Apimo, Orpi, Fnaim, Amepi, Century 21 (franchise), Foncia, as well as a number of smaller networks. There are still a surprising amount that are independent and not part of any network at all. Some estate agents try and push a seller into signing an exclusive contract claiming it is a requirement of the MLS. If an estate agent is very pushy, and emphasising the MLS, beware as it is because they are probably planning to dump the property on there and hope somebody else sells the property for them.

In reality, nearly all the estate agents in Nice collaborate with each other. There is a standard 50/50 split between buying and selling agent.

The reason to give an exclusivity is because you trust your estate agent to be proactive, look after your interests, and to be a one-stop shop for both buyers and all the other real estate agents who may be interested.

The reason to not give an exclusivity is because your property is difficult to sell. If it is tricky to sell then the agent will make less effort, therefore spreading it across several agents will increase your odds. Perhaps you have an estate agent you trust, but your property is physically located directly above another estate agency and you want to be in their window? Then you can give a “co-exclusivity” where just those two agencies can share the listing.

Whether to allow a private sale or not is a personal decision. The estate agent would rather have a clause that you cannot, not because you might sell it privately but because they know the seller will get bombarded with requests from other estate agents pretending to be buyers. There is a reason you are using an agent rather than selling via privately, so just go with the clause the agent recommends. If you do find a buyer yourself, pretty much every agent will be happy to come to “an arrangement”.

The key to picking the right agent is their target market. If you bought as a foreign buyer, you had a particular set of criteria in mind when you bought that will most likely attract other foreign buyers. Therefore ensure the agent has a good international clientele. Locals on the ground also tend to fall into the “bargain hunter” category and so may not give you the best price. Choose somebody you trust, and then the contract details should be quick and amenable.

There are a minimum amount of papers that need to be provided before the buyer is allowed to sign a contract with you. Some of these you will be expected to provide from the documents when you purchased, some will be the most recent documents that you have received, and some will need to be obtained from your building management company. We will explain where to obtain each as we go through the list

The Deeds

The deeds provide:

In the case of it being an apartment then the Lot number, an internal number used by the land registry which corresponds to an internal surface area on the floor plan of the entire floor of the building.. If there is a cellar or parking space then this will have a separate Lot number. This Lot number is required to uniquely identify the property you own. All the Lot numbers can be sold seperately, you are not obliged to sell them together. However if two items fall under one Lot number, such as an apartment and a parking space, then they must be sold together.

The original description of the property. It is not a problem if this has changed because you have done renovation work, an updated description will be added at the contract state to reflect the new layout.

The last buyer and price. The Notaire uses the last buyer to look up the previous deeds, and from there all the preceding deeds up to 40 years ago, to ensure a clean chain of ownership. The previous price is also used to calculate any capital gains tax due.

Whether or not there is a mortgage on the property or not. This is also registered at the Town Hall, called a “hypotheque”, and Notaire will need to remove this and pay the bank off before the property can be sold.

If you cannot find the deeds: contact your Notaire and ask for a certificate of ownership, or an "attestation de vente", and they can provide one instantly. It will be enough for the estate agent, and the Notaire can fetch a copy of the full deeds from the Town Hall once a Compromis has been signed.

The council tax bill

The last "Taxe Fonciere" tax bill is just to let the new owner know the amount they can expect to pay each year. If you do not have the latest, a previous one will usually do as there are minimal changes each year. Because the owner on the 1st January is liable, but the bill does not arrive until September, the seller pays for the entire year but there will be a similar pro-rata reimbursement during the final signing by the buyer, where the buyer will reimburse from the closing day until the 31st December. If you cannot find your tax bill then you can download it from the impots.gouv.fr web site, or you can write to the Tresor Publique and ask for a copy.

The Syndic documents

These are documents you can download from the Syndic intranet. Go to their web site and look for a login button, which may be labelled 'Espace Particulier'. If you do not know the login then check your latest quarterly bill and the login and password may be printed on there. Otherwise you will need to email them for login details.

The building rules

The building rules can be useful, for instance to determined if an apartment can also be used for commercial purposes, or whether an apartment with exclusive access to a garden area has private ownership or it remains communal property but with sole rights of access. If they are written on a typewriter and barely legible this is not your problem, hand them over as-is.

Your last quarterly charges

The last property management, or "Syndic", bill lets the new owner know the monthly charges. Do not worry if the last bill is higher than previous ones, they are itemised and it is simple to discern the actually monthly charge from any exceptional charges. This will also be used to calculate a pro-rata reimbursement, as you pay for the full quarter that the closing date falls into and the buyer pays you back from the closing day until the end of the quarter.

The last 3 years AG meeting minutes

Amongst other things, the AG minutes details any works that have been voted on to be done. Sometimes for large works are split into several calls for funds, "appelle de fonds", which are issued several months apart. By default it is the owner at the point of the date of each call that is liable to pay, not simply at the time of the vote, but this is can be altered in the contract. A good estate agent will spot this for you.

Important: you may receive notice, or a "convocation", for a new AG meeting after signing the Compromis de Vente but before the closing date. You must immediately sign the "Power of attorney" page and fill in the name of the buyer, and then send it by registered delivery to your Notaire. If you do this then all costs voted on during that meeting will be at the charge of the new owner. Otherwise you will be liable for any costs that are voted on even if this takes place after the closing and you are no longer the owner.

Your Syndic supplies the rest

The Notaire will obtain the rest of the papers from your building management company, but will write to you obtaining your permission to settle any costs involved. How much you owe in building management costs will be passed from the Syndic to the Notaire and automatically debited from the sale proceeds. The important paper required from the Syndic is the pré-état daté which tells the buyer about the financial health of the building regarding owners and suppliers.

All the required tests are done by a single insured expert and the process takes under hour. The price for the complete set of tests averages €350, but can be more or less depending on the number of rooms. If you have the certificates provided to you when you bought the property, then if you contact the same firm then they may offer you a discounted price to update them into your name. You cannot use the certificates from the previous owner, they must bear your name.

The complete set of certificates are:

• Size – as apartments are renovated the configuration can change. For this reason there must be a certificate giving the official size, which is measured as the minimum habitable surface area, done by an insured expert. If you sell the apartment and the apartment is remeasured by the new owner and found to be 5% or more smaller then the buyer can take the expert to court for compensation.
• Lead – used to be used in paint until the process was banned in 1948. It is unlikely to be inside a modern apartment but is commonly found in the wooden shutters outside the windows and sometimes on some door frames. The law was passed to protect children from living in a decrepit apartment with peeling paint with lead in, where the child might eat fallen flakes and contract lead poisoning. This certificate is for information purposes only, you are not required to remove any lead found.
• Asbestos – rarely found except in the lagging for pipes in the cellars, if the building has them, a certificate is still required for both the apartment and the communal areas. If any is found then the information provided should be passed onto by the buyer to any renovation company they engage to make them aware of the risk. In general any asbestos found not in a “degraded” state, ie flaking or peeling, can be ignored. For informational purposes only, no action is required regardless of the report.
• Termites – not really a city-dweller problem, it is still nether the less a legal requirement. Expect this to be a mere formality.
• Electricity / Gas – this is for informational purposes only. The regulations change almost on an annual basis, and it is rare for an apartment will get a clean tick sheet. Even a loose plug socket will get noted. For example a later change that may appear is the lack of a low-tension circuit breaker for bathrooms. There is no obligation to make any changes, no matter how faulty the electricity is found to be. This may or may not be a problem for your buyer. An American or Scandivanian client may want you to get an electrician in to bring the property up to code. If their offer is tempting enough then you can do this before signing the sales contract and the expert will update your diagnostics to reflect the clean bill of health.
• Energy efficiency – those famous coloured bars you see on fridges are also a requirement for apartments. The apartment and the building are tested for emissions and energy efficiency and then given a rating from A to G. In general they are always both somewhere in the middle around C/D, unless the building has particularly old communal central heating in which case emissions may fall lower on the chart. There will also be helpful hints attached, such as “Install double glazing”. Any rating is fine as long as it is not F or G, where the government is banning the renting of apartments in buildings with those categories. If your building has a poor rating then expect offers made that take into account a costly future upgrading of the building.
• Natural and technological risks – these apply to the whole 06 region, not just to the city of Nice. It will inform if you are in a forest fire area, flood risk area, an earthquake zone, near any nuclear facilities or grounds that emit radon gas. It is a copy and paste document that does not vary between buildings but still needs to be charged for.

It is recommended to get these certificates done as quickly as possible. Your estate agent will need at least the size Loi Carrez and the energy efficiency before they are allowed to advertise your property. The more documents you have ready, the faster the sales contract can be drawn up and the greater the chance of a successful sale.

Offers are usually first given verbally, via the estate agent, from buyer to seller. The seller can either reject it or come back with a counter-offer. A price is agreed over the next few days or the parties decide to walk away. Once a price has been agreed then a written offer is sent from buyer to seller which the seller then countersigns. No matter how the offer is worded, it is not legally binding for the buyer. It acts as a memorandum of understanding until both parties sign a Compromis de Vente. In practice, I have never seen a written offer broken by either party.

The buyer usually signs the Compromis first. It is then counter-signed by the seller. As the seller, the moment you counter-sign you are immediately committed to the sale. You cannot change your mind and you cannot change the price. It is important you are happy with:

• the price – ensure you distinguish between where it is marked "prix de vente" which is the total sale price the buyer pays, and "prix net vendeur" which is how much you will receive. The difference between the two is the agency fee, which will also be clearly marked.
• method of financing – if the buyer waives the right to a mortgage then after ten days the sale is safe. If the right to a mortgage is maintained then it could be 1-2 months before it is confirmed by the banks that financing has been approved. The buyer must be applying to French banks for this right to be valid.
• final signing date – this should be a couple of months after the date the offer is accepted, up to three months if falling over holidays or Christmas, and should incorporate a safety margin for the buyer to transfer the funds and for the seller to move out. The actual signing date falls between when the Notaire can complete the paperwork, minimum a month, and when the buyer can transfer the money into the Notaire's bank. A signing date can be agreed between parties for any date they wish, but either party has the right to push that back at any time to any date before the agreed final signing date.
• any furniture – this is usually annexed to the Compromis. A value should be attached to the furniture, though you can no longer use that trick to substantially reduce you capital gains tax due to past excessive abuse leading to a change in the law. This value is indicative so do not worry about how they match up to real world second hand values.

You should discuss all these points with your estate agent before signing the Compromis de Vente. Once the Compromis is signed then in practice nothing should change in the closing contract that is signed later. It will be identical. Any change can incur a risk to the sale. For instance if you try changing the price then you not only need to clear the right of pre-emtion from the Town Hall a second time, but you restart the timer on the buyer's 10 day cooling off period.

Once the Compromis is signed by both parties, the buyer should transfer his 10% deposit to the Notaire account. After this you must wait for the ten day cooling off period to expire. If the buyer exercised the right to get a mortgage then you must wait for the buyer to receive a written mortgage offer from the bank, and then the 11 day cooling off period between the buyer and the bank before they are able to return their acceptance of the mortgage offer.

What happens if you get toward the final signing date and there is no signing planned? The Notaire is an independent arbitrator, and so if there are delays are clearly not the fault of the buyer then the Notaire may briefly extend the date. However you will need to wait until after the final signing date before claiming the 10% deposit from the seller. In practice buyers are highly motivated by their deposit and I personally have never seen a seller need to try and claim it.

Handing over the keys

Your responsibility is to ensure that the apartment, as well as any dependencies such as a cellar or garage, is free of all encumbrances. This includes furniture and rubbish. If the buyer is obliged to call a removal company to remove old furniture, the seller will be billed for the service. The Notaire will withhold a more than adequate sum on the day of sale, and return the difference once the removal company has sent the bill.

The apartment must be free from occupancy, if the contract is not explicitly sold on with a renter in place, from the day of sale. If the buyer is not able to move in on the day of sale then this can incur financial penalties.

Once the signing is done, you should hand over all copies of any keys to the apartment and any annexes sold with it such as a cellar or garage. If you have handed power of attorney to your Notaire, your estate agent will be there to hand over the keys.

After both parties have signed and the keys handed over then your Notaire will send you a certificate of sale.

It is up to you to cancel your utilities and insurance contracts:

• Send your certificate of sale to your insurance company and they will cancel the contract and also refund you for any unused months you have paid for. For example if you pay annually.
• If you have a Linky (green coloured) electricity meter then your estate agent will make a note of your serial number which is under the label "PRM". If it is an older meter then they will also take the meter reading. If you have an off-peak contract then there will be two numbers, "heures plein" peak and "heures creuze" off-peak, otherwise just one number. You should then negotiate with the buyer how long before they change over the contract. Up to a week is reasonable. Once they change the contract to their name then your contract is automatically cancelled and you will be sent the balance to pay. If they have not transferred after this time period then you can call the electricity provider and cancel, and the buyer will have to risk getting cut off. You can send the certificate of sale along with the request to cancel the contract.
• Most buildings in Nice have the Syndic take care of water metering, but if you have a separate water bill then you will need to write to cancel the contract. You can send them the certificate of sale at the same time.
• Finally, and not least, you should cancel your Internet provision. Important: many providers will ask you to return the boxes or will charge you hundreds of euros. Make sure you remove the boxes before the day of sale and hand over the keys. If you leave them in the property then there is a high chance the buyers throw them away before you can rectify the situation. Most providers to not allow new owners to use the in place boxes, they need to order their own.

Picking up the cheque

Once the agency fee, the capital gains tax, mortage (and fiscal representative if outside the EEA) and any Syndic debts have all been paid off, the remaining sum is yours. These days the ‘cheque’ is virtual, payments are now only made electronically. You can provide your Notaire with bank details for any international bank with a valid IBAN, it does not need to be French. If you wish to use a currency broker to get a better exchange rate, ensure you contact the Notaire and arrange this with him in advance. There are strict anti-laundering laws which means he has to personally verify the seller is the true recipient. The bank account needs to be in the names of the sellers for the transfer. Your sale is now complete. Ready to upgrade to that bigger and better apartment in Nice that you are now after!