Property Purchase/Sale Completion - clarification of the situation in these uncertain times.

Many people are in the situation of having agreed a property purchase/sale and now are asking themselves if the transaction will fail in these uncertain times. Let me clarify the situation, as I understand it at this moment in time:

Notaire offices are closed to the public for the foreseeable future, until the 'lock-down' situation changes. Notaires and co-workers are still working, but behind closed doors. Many other public services associated with property transactions are either closed, or running at a reduced service. So, how does this affect ongoing property transactions?

1. You have already agreed terms of purchase/sale, but first stage of signing the contract (compromis de vente or promesse de vente) is not signed yet:

Provided the seller has had all the necessary diagnostic reports completed for the property and they are in date, your Notaire can raise the first stage contract, just as he/she normally would and all parties can sign, preferably electronically, should the service be available, but otherwise, on paper, with the Notaire (plus Estate Agent if one is involved) facilitating the explanations remotely and deciding on the method of signing and returning the contract.

2. The first stage contract has been signed:

This first stage contract has an 'expiry' date, normally around 3 months from date of signing (but could have been agreed as longer by parties involved for various reasons), to allow the necessary collection of paperwork, complete searches etc, before the final signing date.

In the light of the current public health crisis, Notaires can no longer facilitate the final signing (completion) of property purchase/sale contracts (Acte de Vente). There are a number of reasons for this:

a) Not all services may be fully available to allow the necessary searches etc to be completed.

b) The final contract should be signed in the presence of a Notaire and their offices are closed to the public.

c) Limitations of personal interaction (and travel) does not allow for final property inspections by purchasers, either accompanied by an estate agent, or not; home removal companies, packing and cleaning companies etc are not currently in operation to facilitate the move and some utility services are not fully available (utility companies are operating, but for necessities and stipulated services - to expect someone to popover to turn on your water of your new home would not be reasonable at this time).

Some sellers and buyers are concerned that should they be unable to complete by the time the 'expiry' date of the first stage contract has been reached, then the transaction will fail. THIS IS NOT THE CASE.

Under such circumstances an avenant (amendment) to the first stage contract can be raised by the Notaire, signed by all parties, which will extend the date, to allow the final contract to be signed later in the year, once everything is back to normal.

This does mean however, that there will be a delay in completion of the transaction, so sellers remain in situe and buyers cannot move in. For most people, hopefully this will be an inconvenience at most, which is understandable and for the protection and well-being of all.

((N.B. UPDATE 15th April 2020 LEGAL RULING FOR ONGOING PROPERTY TRANSACTION CONTRACTS -

The bill passed on 25th March 2020, as below, was reversed on 15th April 2020 - Ordinance No 2020-427

Contracts - in particular Compromis de Ventes - signed during the confinement period revert back to normal procedure with regard to the 10 day cooling off period afforded to buyers. Should you have questions about your particular sale/purchase circumstances with regard to this matter, speak directly with your Notaire

On 25th March 2020 the judiciary passed the following bill:

Property transaction contracts signed where the 10 day cooling off period had not expired by 12th March - update on completion of 10 days legal right of withdrawal for buyers.

"All sales compromises, signed sales promises whose withdrawal period was not completed by March 12, 2020, are covered by Order no. 2020-306 of March 25, 2020. The withdrawal period of 10 days will start again at zero one month after the end of the health crisis."))

Should you be in an unusual circumstance (e.g. maybe no fixed abode and moving into an already vacated property), then speak with your Notaire to ask if there is anything which can be done to facilitate the move, but frankly I am uncertain if there will be a possibility of completion in the short term - but no harm in asking.

If you are at all concerned about the circumstances you find yourself in regarding your ongoing property transaction, then don't hesitate to ask your Notaire for their advice (and should you be using an Estate Agent, contact him/her in the first instance).

Above all, be assured that all professionals will do their utmost to ensure the transactions aren't in jeopardy and can complete once it is at all possible.