THE SURVEY SAYS
When buying a property in France it’s important to understand the differences between surveys and diagnostic reports, and why both are beneficial, explains Matthew Cameron
Solicitor Matthew Cameron explains the legalities of property surveys and reports
The process of buying a property in France differs in many ways from in England and Wales, yet there are similarities. When we are advising clients we find it is useful to compare the two systems, as this often helps to explain what is going to happen, and why.
In relation to whether to commission a survey before purchasing, our general advice to clients is that if you would do this in England, then do so in France. There is no legal obligation to have a survey in England, yet it is standard practice to do so, even when buyers do not require a mortgage: lenders in England invariably insist on at least a basic inspection, which is not necessarily the case in France.
THE BENEFITS OF A SURVEY
It is certainly less common for buyers in France to commission a survey, yet we regularly suggest buyers do so, even though this stands against widely held views that surveys are ‘just not done in France’, or it is unnecessary as the seller has to organise a survey anyway.
While it may well be less common, that certainly does not mean it is ‘not done’. There are a number of suitably qualified surveyors and other property professionals throughout France, many of whom will direct their marketing to the British buying market.
If you are going to commission a survey, this should be carried out in advance of signature of the first contract (which in normal circumstances will be called the compromis de vente or promesse de vente). Buyers are occasionally encouraged, if they want a survey, to sign the contract first, and have the survey carried out while they are in their 10-day cooling-off period. Doing this may limit the buyer’s ability to review the terms of the purchase agreement if the survey were to reveal issues of concern, and the only option is to terminate the purchase. Furthermore, if the surveyor is not able to complete the survey or report to you within the 10-day period, then it may simply prove too late to do anything, even if the results are unsatisfactory.
Again, the advice must be that if you would carry out a survey on a purchase in England, you would inevitably do so before the contract is signed, and that is exactly what you should do in France.
THE DIAGNOSTIC REPORTS
It is a requirement that the seller of the property must organise certain pre-contract inspections, which vary depending on the age, location and type of property that is to be purchased. However these are specifically limited in scope, and will normally be somewhat restricted. The inspector will not be required to move furniture, lift carpets or enter locked or hard-to-access rooms or attics. It is important to see whether any parts have not been checked, as the inspector’s guarantee would not cover these.
The inspections include the following:
The first is an energy efficiency report, which must be produced before the property is marketed. Buyers will have seen agency particulars for any property on sale bearing the familiar energy efficiency colour rating, and it is now a requirement that this be included from the start. The report establishes the estimated annual economy rating and carbon dioxide emission for the property.
In addition it will include proposals for improvements in the overall efficiency. Any proposed improvements would include an illustrative cost/benefit analysis, calculated by comparison of the initial cost of any improvement against the speed with which any savings can be made, and taking into account any tax credits that may be available under French law. Naturally, any tax credits would only be available for French tax residents.
If the property is an apartment, or perhaps on some estates, then it will probably be part of a co-ownership. As such, there will be a certification of the internal surface area of all habitable parts of the property. This excludes areas such as storage rooms, ski-lockers and any habitable parts that are less than 1.8m high. The reason for this inspection is that properties in co-ownership are, in theory, sold by reference to the square metre value.
If, within one year of the sale, the buyer establishes that the property is more than 5% smaller than the originally declared size, they would be able to seek a proportionate reimbursement of the price. Given the inspections, such claims are extremely rare now.
Perhaps the most well known of the inspections is the termite report, which is required in various areas of France, predominantly in the southern, warmer regions. This reveals whether there is any evidence of active infestation in the woodwork, either inside or out. The inspector cannot hack into wood to see if the insects are burrowing beneath, but will be looking for certain signs as to their presence.
There will be a search to see if any materials are likely to contain asbestos, and this will be required for properties dating from before 1997. However, asbestos is quite common in many properties, and if present its location should be known. The material can be quite dangerous if exposed and damaged in any way, and if it becomes damaged in the future, it should certainly be stripped out. Some people prefer to clear it out as soon as they purchase, although this can be quite costly.
A search for lead-based paint is required in properties built before 1948. This will reveal if any paint contains lead above a certain threshold (1mg/cm2), and if that paintwork is in a damaged state or otherwise gives rise to any risk of lead poisoning.
GAS AND ELECTRICITY
If electrical and gas systems are more than 15 years old, these will need inspection. Any anomalies identified should be rectified by the buyer following completion. If those anomalies were to give rise to a catastrophe in the future, it is possible that insurers may resist indemnifying any losses.
The ERNMT (the État des Risques Naturels Miniers et Technologiques, or natural risk report) is an information pack confirming any recognised risks in the vicinity. These will often exist – it should come as no surprise that many areas in Alpine resorts are prone to avalanche… What is important to note is
whether the property in question may be in a direct risk area, and whether there have been any claims raised for damage to it in the past.
Where there is a private drainage system, this will be inspected to ensure it complies with current EU regulations. If not, the buyer will have one year from completion to upgrade, and if the property is not sold, the seller will have four years in which to correct any problems. The cost of installing a new septic tank, if that is needed, can be substantial.
KNOWLEDGE IS POWER
The various inspections that are carried out are very informative. The report pack provided by the diagnostiqueur – the inspector – is in general quite large, although much of the information will be establishing the methodology employed in the various inspections, any limitations of responsibility, and qualifications and insurance of the inspector. An experienced reviewer can, however, extract the relevant reporting information quite quickly.
Given that the search criteria is strictly limited, these inspections will not in general give a view as to the overall integrity of the
building. If there has been a previous termite infestation, a buyer would be able to require the seller to produce the evidence of a treatment programme to eradicate them. However it will not necessarily extend to an analysis of the extent of any damage caused by that previous infestation. On the other hand, a buyer could expect that information from a survey.
The inspections have varying terms of validity, the shortest being the termite report that is only valid for six months, while a report for asbestos is valid without time limit.
Taken together, the pre-contract inspection reports and a structural survey should offer a good insight into the property you are looking to purchase. There is no criticising a cautious approach to the process, so seeking a survey in addition to the inspections could be worthwhile, just as instructing a specialist solicitor to review the legal documentation is.
Considered together, in advance of signature of the contract, they may offer opportunities for further negotiation.