Acceptance (réception des travaux)

Once the building work has been completed, the original owner inspects the building and accepts the work with a list of outstanding defects if any. Acceptance triggers the various guarantees (proper operation and ten-year warranty).

APR (TEG or taux effectif global)

Annual percentage rate. The total cost of credit including interest, bank fees, insurance premiums and other costs. Because different lenders charge different fees, the APR is a good way to compare the total cost of a loan from various lenders.

Attic (combles)

Space under the roof of a house, between the top floor and the roof timbers.

Authentic deed (acte authentique)

To qualify as authentic, a contract or preliminary agreement (undertaking or promise to sell) must be signed in the presence of a notary.

Building permit (permis de construire)

A permit delivered by the town hall that is compulsory for the construction of all new buildings.

Common parts (parties communes)

Parts of a property that are normally in common use by all owners or inhabitants of a multi-unit building, e.g. stairs, courtyard, garden, access roads, etc.

Common parts reserved for private use (parties communes à jouissance privative)

Parts assigned for the common use of all condominium owners, but enjoyment of which is restricted to one owner only : a roof garden, for example, or a garden adjacent to a ground floor dwelling.

Completion (achèvement de l'immeuble)

A building is regarded as completed when it is habitable, even though there may still be finishing or fitting-out work to be completed.

Completion guarantee (garantie de parfait achèvement)

The builder or each contractor must offer a one-year guarantee with effect from acceptance to make any necessary repairs to the property.

Compliance certificate (certificat de conformité)

Issued by the mayor or departmental prefect no later than 30 days after completion of the work, certifying that the work complies with the provisions of the original building permit.

Conditions precedent (conditions suspensives)

Conditions that must be satisfied before a preliminary sale agreement becomes binding on the parties. The most frequent conditions precedent involve the buyer's obtaining a loan and non- exercise of a pre-emptive right.

Condominium (copropriété)

Ownership of a unit in a multi-unit building, plus an undivided interest in the ownership of the common parts, which are owned jointly with the other condominium unit owners. A condominium is governed by a set of by-laws.

Condominium by-laws (réglement de copropriété)

The rules and regulations that specify how a condominium operates and the rights and obligations of each unit owner.

Consideration period (délai de réflexion)

Under the Scrivener and Neiertz Acts, all borrowers are legally entitled to a ten-day consideration period before accepting a loan offer.

Cooling-off period (délai de rétraction)

Under the Neiertz Act, buyers of a new home have seven days in which to cancel a reservation contract or any other preliminary sale agreement if they change their mind. It does not apply to final contracts signed in the presence of a notary.

Declaration of completion of work (déclaration d'achèvement des travaux)

This declaration must be completed by the beneficiary of the building permit no later than 30 days after the work has been completed.

Deed of sale (acte de vente)

The final sale contract, signed in the presence of a notary, which transfers title to a real estate asset.

Defect (vice)

A patent or latent construction defect.

Deposit (acompte)

Sum paid by the buyer on signing the preliminary sale agreement, generally equal to 10% of the purchase price. Payment of the deposit binds the buyer, subject to fulfillment of any conditions precedent.

Down payment (apport personnel)

The portion of the purchase price paid by the buyer. Generally speaking, the higher the down payment, the better the terms of the loan you can obtain.

Endowment loan (prêt in fine)

A home loan combined with an insurance policy. Throughout the entire term of the loan, the borrower makes monthly payments of interest only and the principal is reimbursed at maturity from the proceeds of the insurance policy.

Fees (débours)

Various fees paid for the deed of sale by the notary on behalf of the buyer (land registry, surveyor, etc.).

Fractional undivided interest (quote-part)

The proportion of the common parts owned by each individual condominium owner, expressed as a thousandth or other fraction. This fraction serves as a basis for allocating the service charges.

Gross floor area (S.H.O.B. or surface hors œuvre brute)

The floor area of each level of construction, including attics and basements, balconies, verandas and roof terraces.

Homeowners association (syndicat de copropriétaire)

All unit owners in a condominium.

Interest rate (taux d'intérêt)

The interest rate payable on a loan represents the cost of borrowing money. Interest rates may be fixed or variable.

Land register (cadastre)

Public records showing the floor area and value of real estate assets in each town. The land register can be consulted in the town hall and is used as a basis for calculating property tax.

Latent defect (vice caché)

A construction defect that is not apparent at the time of acceptance of the work.

Local taxes (impôts locaux)

Taxes charged by all local authorities: municipality, department, region.

Management company (syndic de copropriété)

Appointed by the condominium homeowners association at their general meeting, the management company (usually a professional) is responsible for managing the condominium and ensuring compliance with its by-laws.

Net floor area (S.H.O.N. or surface hors œuvre nette)

The floor area of each level of construction, excluding attics and basements that are not habitable, roof terraces, balconies, unenclosed parts of the ground floor, and buildings designed for vehicle parking.

New building (immeuble neuf)

Any building which is less than five years old and has not had a change of owner (except for real estate companies).

Notary (Notaire)

A notary is a Government-appointed officer whose job is to draw up, conserve and authenticate certain civil deeds, including property purchases and sales, pre-nuptial agreements and wills. Notaries also provide advice.

Notary's fees (émoluments)

Fees charged by the notary, the amounts of which are fixed by government decree.

Old building (immeuble ancien)

Any building which is more than five years old or which has already had a change of owner.

Owner (maître d'ouvrage)

A person or company (SCI [see definition], investor) paying for a property to be built. The owner then appoints a project manager to complete the project.

Performance bond (garantie d'achèvement)

A performance bond is compulsory for all homebuilders selling homes from plans. It guarantees that you will receive your money back if for any reason the building is not completed as agreed.

Principal residence (habitation principale)

Designates the household's principal place of residence for tax purposes as opposed to a second home.

Private parts (parties privatives)

Parts restricted for the exclusive and private use of one of the condominium owners.

Project manager (maître d'œuvre)

A company or a professional in charge of designing a real estate project, managing and supervising the work and ensuring that the work complies with all contractual conditions.

Proper operation guarantee (garantie de bon fonctionnement)

Builders must offer a two-year guarantee with effect from acceptance covering all non- structural works that are not covered under the ten-year warranty, such as the heating system and windows.

Property damage insurance (assurance dommages ouvrages)

Insurance that must be taken out by the builder before work begins. It covers the builder for the compulsory ten-year warranty and guarantees immediate repair of all damage without seeking to apportion blame or responsibility.

Property tax (impôts fonciers or taxe foncière)

Local tax that must be paid by all home owners. The amount varies according to location and floor area.

Real estate revenues (revenu foncier)

Revenues derived from property rentals.

Registration duty (droits d'enregistrement)

Tax charged on registration of a deed conveying title to a building or real estate rights.

Rental property inspection (état des lieux)

It is compulsory for a landlord to make a full inspection of the property with a new tenant prior to occupancy. Both parties then sign an inspection schedule, which is used to assess the state of the property when the tenant moves out.

Rental value (valeur locative)

Annual market rent achievable on a real estate asset.

Repayment loan (prêt amortissable)

The most common form of home loan, whereby each monthly repayment made by the borrower reimburses a portion of the principal together with interest due.

Repayment schedule (échéanchier)

A document that must be provided by lenders showing the exact amount and due date of each loan installment, and the breakdown between principal and interest.

Reservation contract (contrat de réservation or contrat préliminaire)

TPreliminary sale agreement by which a vendor undertakes to reserve all or part of an uncompleted building against payment of a deposit.

S.C.I

Société Civile Immobilière. A type of company designed specifically to purchase, manage, build or sell real estate assets.

Sale from plan (V.E.F.A. or Vente en l'Etat Futur d'Achèvement)

A formula by which you become the owner of a home that has not yet been built. You make regular payments for the home as the work progresses.

Scrivener Act (Loi Scrivener)

Law designed to protect borrowers. It makes obtaining a loan a condition precedent to a property sale (and vice-versa) and regulates how loans may be advertised and what information the loan agreement must contain.

Service charges (charge de copropriété)

Expenses incurred for running costs, maintenance and repairs to common parts of a condominium.

Site cost (charge foncière)

The price of buying the land plus all site preparation costs for construction. It has a direct influence on the total price per square meter.

Supplemental agreement (avenant)

Any subsequent agreement that completes or amends the initial contract.

Surety (caution)

A person who undertakes to pay the debt of another if the latter fails to do so. A surety may be required to guarantee loan or rent payments.

Tax benefit (avantage fiscal)

Tax reduction or allowance against taxable income available on some types of home purchase (Besson incentives) or construction work. Information can be obtained from your tax office.

Taxable income (revenu imposable)

Total of all net annual revenue used as a basis to calculate income taxes.

Ten-year warranty (garantie décennale)

Builders must offer a ten-year guarantee, as of the date of acceptance of the work, covering all defects that could weaken the building or make it unfit for the use for which it was intended.

Thousandth (millième)

In a condominium, the unit used to quantify each unit owner's undivided fractional interest in the common parts.

Timeshare (multipropriété)

A form of joint ownership interest through shares held in a property company (société civile immobilière - SCI), which allows each owner use of the property for an agreed fixed or variable time period.

Transaction costs (frais de notaire)

Transaction costs comprise taxes payable to the French Treasury, the notary's fees and other fees paid by the notary on the buyer's behalf. They amount to approximately 8% of the purchase price of an old building and approximately 3% of a new building.

Transfer duty (droit de mutation)

When a property is sold, transfer duty refers to all taxes collected by the notary on behalf of the State or local authorities.

Urban planning (urbanisme)

The entire process of organizing and developing a given urban area.

Urban planning certificate (certificat d'urbanisme)

Administrative document indicating whether or not a plot of land is buildable and whether it satisfies all the urban planning requirements applicable to it.

Vacancy (vacance)

When a rental property is unoccupied.

VAT (TVA or taxe sur la valeur ajoutée)

Value added tax, or sales tax, the standard rate of which is 19.6% in France. The initial sale of a new building is liable to VAT.

Zoning plan (P.O.S. or plan d'occupation des sols)

Plan voted by the municipal or urban council designating the general planning and land use rules applicable to all land and property in the municipality.