Buying Real Estate in France : New-build or old?

28 March 2022

 Buying real estate in France is wonderful project. Indeed, you can invest in a new real estate or in an old good. What choice to make ?

Buying real estate in France : New or old real estate?

When making a real estate investment, the question of new or old real estate is frequently asked. Before launching you, let us compare!

The question, at least crossed the spirit of all those which consider a real acquisition: is it preferable to buy in the new or in the old? The dilemma is not only a matter of price, but also the expectations and lifestyle of the future buyer, and many other factors can influence this decision.

Let’s analyze the advantages and disadvantages that each real estate program brings.

New properties:

New homes offer functional and modern living spaces, but also many guarantees to cope with unforeseen circumstances. What are the main advantages of new housing?

Recent and modern standards

Unlike some older buildings, new homes provide quality services because they are, for the most part, always up to the latest standards. They respect all the regulations in terms of thermal insulation, sound insulation, but also in terms of installation of plumbing, electricity, ventilation, heating, accessibility for people with reduced mobility, etc. …

The advantage of buying new and on plan, before the building work, is to be able to modify, in any case to arrange, with your taste and according to your needs, the aforementioned plans. So many aspects which will have a direct and not negligible impact on your future quality of life to the daily newspaper.

A solid level of guarantee

The acquisition of a new property offers many legal guarantees.

Once you have the keys to your new home, you are free to use the builder’s damage insurance for two years as part of the “perfect completion” guarantee. This protection allows for the coverage of all types of repairs, including those involving equipment that is not an integral part of the building, such as woodwork (shutters, windows, etc.).

To this first layer of protection is added the famous “ten-year warranty”. The builder is liable for ten years for any defects that could jeopardize the stability or viability of the building (major cracks, waterproofing problems in the walls or roof, etc.).

Favorable real estate measures

By investing in a new home, you can benefit from a number of advantageous aid schemes. For example, the “prêt à taux 0+”, an interest-free loan to finance the construction or acquisition of a new home, with or without work, or the Pinel scheme.

Less expenses and taxes

Although they are more expensive than older properties, new homes have lower expenses.New housing partially compensates for its high price with lower expenses both at the time of purchase and in subsequent years.Note the importance of the absence of transfer duties which results in low notary fees. It is also possible to benefit from a reduced VAT rate of 5.5% if you build near an ANRU zone.You will also benefit from an exemption from property tax for the first two years following completion of the work.With the new construction standards, you can finally expect, in the long term, a significant gain in purchasing power thanks to savings on the heating bill.

A project that requires time and money

The price per square meter of new housing is 15 to 20% higher than the cost of old housing, which is enough to dissuade many potential buyers. The acquisition of a brand new property requires above all a good dose of patience.In the case of a sale in the future state of completion (VEFA), 18 to 30 months can easily elapse between the signing of the reservation contract and the day the keys are handed over. This wait is long and constitutes an undeniable stress for the future owner. He cannot trust the project manager blindly and must therefore keep a constant eye on the progress of the building site and the finishing of the project.

buying real estate in france old or new

Buying real estate in France : Older properties

With a considerable stock of housing and real estate, the former offers a huge choice to future buyers, and therefore a significant margin of negotiation. However, the guarantees are less important and the taxation more rigid.

Many properties available quickly

In view of the quantity of properties offered for sale, old buildings have sufficiently diverse characteristics to enable the ideal apartment to be found. The large surface areas, the perfect geographical location and the cachet of the old building are among the traditional assets.

The buying process is also much faster and simpler. From the signing of the sales agreement to the signing of the deed of sale and the move in, it takes an average of three months.

More accessible prices

The current market of the real estate known as “old” is characterized by a greater number of salesmen. This situation benefits the future buyers who have only the embarrassment of the choice and very often, the possibility of negotiating appreciably the price. A discount of 10.000 or 15.000 € on the posted price is not rare. It allows to cover the notary’s fees or some repair works. There is no reason not to hope for a substantial capital gain if you plan to resell the property within four or five years.

No more work to foresee…

An old house is bought “as is”, with its qualities and its defects. he various mandatory diagnoses carried out by the former owner protect you in principle from the worst news (energy performance, termites, lead, asbestos…). Nevertheless, you must expect to face more work and unforeseen charges in the future. Unlike the buyer of a new property, the owner of an old property pays the full rate of property tax as soon as the transaction is finalized, whereas it is often possible to benefit from an exemption for 2 years when buying a new property.

A less favorable tax system

In old buildings, the transfer duties levied by the local authorities and the State are significant and one should not forget the notary fees, which amount to 7 to 8% of the total sale price. Unlike the buyer of a new property, the owner of an old property pays the full property tax as soon as the transaction is finalized. Finally, certain public assistance measures for access to property are more restrictive and complicated to implement for an older home than for a new one.

The Team Roche & Cie

Professionals or individuals, French or international, since 1948, Roche & Cie has been assisting clients from all horizons. 
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