Advice for Americans Buying Real Estate in France

Advice for Americans Buying Real Estate in France

In any ’normal’ year, France receives over 100,000 foreign nationals from all nationalities who wish to settle in this sought after european country.  This represents approximatively 10% of all property sales in France.

Since the beginning of the pandemic we’ve seen a significant increase in enquiries from american families,  professionals and investors wanting to learn about buying a home and staying in France for a while.

This article is designed for americans looking to purchase or invest in real estate in France. The most frequent questions we receive are about visas, taxes and also legal information. The Visa situation is a good place to start, especially if you’re starting to plan for next spring or summer.

Do I Need a Visa to Travel to France?
This will depend on how long you wish to stay in France and if you’ll be working or just taking a holiday. If staying for less than 3 months and not earning income, US citizens and american passport holders usually do not need a visa. The first step should be to contact the local French embassy to ask about visas and requirements for staying and/or working in France.

Residency Laws for American Travellers
The above mentioned 90 day rule states that tourists and visitors can spend 90 days out of every 180 in the European Union without the need a visa. So you can effectively spend 180 days (6 months) in France but you cannot spend more than 90 successive days in the country and the EU.

Should you wish to stay in France for more >90 days then you will need to obtain a Long Stay visa. Note that you can only apply for one type of visa at a time, so plan carefully as it is very difficult to change the status once in France, you would have to return to the USA to re-apply before returning with the new visa.

Can I Live in France Permanently?
Once you have lived in France for five continuous years, you may apply for a ‘carte de résident’. This is a renewable permanent residence permit that allows you to live in France for up to 10 years.

Is Buying a House in France a Good Investment?
The French property market is considered to be stable with house prices rising steadily. In the last quarter of 2017, average prices were up 3.4% year-on-year on a national level. Property prices have continued to increase at a steady pace in greater Paris (+3.9% from march 2018 to march 2019) and was predicted to grow by 7% for the luxury real estate market.

Real estate prices in Paris have increased by 23% in the last 5 years, growing from an average €8,368/sqm in 2015 to €10,288€/sqm in winter 2019, of course that was before the pandemic but prices have held up wlell at around 7/8% for old apartments in the capital. And prices have increased in most rural areas boosted by French and european professionals looking for peace and fresh air in the countryside, as well as shortage of new homes to sell.

The average house price for American buyers in 2017 was around 450,000 euros, at MFH-HQ we’re finding that the average budget for our US clients to be slightly higher at 600,000 euros, this figure is due to seemingly growing interest in historic properties, estates and chateaux.

Why is the French Healthcare System So Good?
France has a longer life expectancy, a lower infant mortality rate and a higher doctor/resident ratio than the United States. The focus on preventative care means that patients are less likely to return for follow-up appointments.

The system in France allows more choice as there are no insurance companies restrictions as they can be in the US.  “Sécurité Sociale” is government funded which means everyone has access to affordable health care, whether you are a citizen, resident or a visiting tourist.

Is Health Care Free in France?
Healthcare costs are covered by both the state and through patient contributions, they are completely free. The French national insurance fund, Caisse Primaire d'Assurance Maladie (CPAM), will then repay you for part of the costs later. Most families in France have a top up medical care insurance that completes most needs including as dental and optical care. 

Is it Difficult for Americans to Arrange a French Mortage?
The short answer to this is YES, it is difficult; the ‘Foreign Account Tax Compliance Act’ (FATCA) is part of the US tax code, it was introduced in 2014 to help counter tax evasion. The cost for complying to this administrative procedure is high to French banks. With already very strict lending criteria, this means that few lenders will entertain considering loans from US clients.

If you require finance for your project, it’s essential that you research this early on, we can put you in contact with our specialist finance partners who can advise on the best borrowing options for overseas buyers. Note that a minimum of 30% deposit is normally requested for non-EU-residents, nearer to 50% shows a better understanding of how french mortgages work and financial security.

What Are the Tax Implications?
Regardless of citizenship or nationality anyone living in France permanently will be taxed on their overall income. Home owners, families and investors not residing in France must pay tax on any income earned from properties that they own in the country.  All income must be recorded and reported, so make sure that you include your running and other fixed costs (local taxes, repairs, utilities, insurance, management fees, etc …) to reduce the tax bill. We advise to use a local accountant or book-keeper, ideally english speaking.

Is the Buying Process Complicated?
Although different to what you are accustomed to, the Buying Process is pretty straight forward, aimed at protecting the buyer and takes 3 / 4 months to complete on average.  There’s no deposit to pay until the pre-contract has been signed and the 10 cooling off period has elapsed. See our guide to buying a property and note that we work with excellent english speaking notaires who are now well up to date and equipped for with meetings and POA’s at distance.

Where Can I Find Travel Advice for France?
There’s plenty of travel advice everywhere, and everyone has different views, and ways of arranging their flights and trips. Start by looking at the travel advice back home, even at your nearest airport or airline, they’re usually up to date with the latest travel advice.  And this link from the US Embassy in France website and advice for Foreign Nationals in France from the French Government.

For those travelling from the USA via London, here’s the UK government travel advice. And look for advice at other hubs of the countries you are travelling from and to, starting with Paris Charles de Gaulle, New York JFK, Miami and London Heathrow, and the last link will show all the airports in France, small or large, for domestic and international flights.

At my-french-house.com we believe that your house hunting experience in France should be focussed and efficient, especially in the current conditions and coming from the other side of the atlantic. However, many buyers will find that the French realty listing system is very different as the ‘French agents immobiliers’ work in a different way than realtors in the US.

We hope you find this article useful, register with us and tell us about your project and timeline and let us guide you to your own ‘aventure française’!