Asking prices and acceptances

[Pangur]

The same house is offered for sale in one agency at 100k and another at 130k.  As I understand it, the vendeur is obliged to sell at the asking price.  But which is really the legal asking price? 

Luckily (?) we signed the bon de visite with the lower priced agency.  However, we know that there is another buyer interested in the house and until now, we have been offering under the asking price.  We can afford the full price and are prepared to offer it. 

Are the vendeurs obliged to accept our offer, even though a potentially higher price can subsequently be offered?  Or is it just a race to see who gets the comprise de vente signed first?  Or have we got bad advice and there is no obligation to sell at the advertised price?

 

[edyth]

I am not sure what is legal when agencies vary so much but this is our story.

We viewed our house with an agency and decided to make an offer but just before we did so I noticed that the house was in the latest immobilier "free give away leaflet" with 4 other agencies and all 4 were asking 8000€ less than our agency. I rang our chap and made an offer at the lower aking price and pointed out the adverts of the others. He was surprised to see the lower prices as he said the agencies (in this area) usually agree to a price before advertising goes out. Anyway he went ahead and the offer was accepted and here we are.

Good luck with your offer!

 

[chicfille]

[quote]The same house is offered for sale in one agency at 100k and another at 130k. As I understand it, the vendeur is obliged to sell at the asking price. But which is really the legal asking price? L...[/quote]

The vendors sell at whatever price they accept from you. Our house was offered by 5 different agents at 5 different prices, the difference being the agency fees. Often houses are advertised "FAI" (frais d'agence inclus), and the percentage they charge the buyer varies from one to another.

When you make an offer, make sure the agent knows what your offer includes (sale price alone, sale price + agents fees or even sale price + agents fees + notaires fees). The vendor may or may not accept, and nothing is binding until an offer is accepted and both parties have signed the Compromis de Vente. So it is in effect a race to sign the Compromis.

It's worth knowing that agents' fees are also negotiable, by the way.

[Russethouse]

Its been mentioned several times on this board that French sellers are 'obligated' to accept an offer of the full asking price - so how does that work when there seem to be several 'full asking prices' ?

[Nick Trollope]

[quote]Its been mentioned several times on this board that French sellers are 'obligated' to accept an offer of the full asking price - so how does that work when there seem to be several 'full asking prices...[/quote]

I'm not sure that this is the case (or even obliged). It is the case that the Notaire can be empowered to sell a property at the asking price (on his books, presumeably) without reference to the Vendors. This is used when there are several Vendors (a succession sale, for instance) where the "putting of offers" would be difficult or impossible. This is the situation we were in when we bought one of our properties.

Offering anything less than the asking price in these circumstances is likely to be met with a complete lack of a response, in my experience.

 

[Russethouse]

Thanks Nick - I wondered how it worked.

[Debra]

[quote]The same house is offered for sale in one agency at 100k and another at 130k. As I understand it, the vendeur is obliged to sell at the asking price. But which is really the legal asking price? L...[/quote]

We saw a property we liked and offered below the asking price there and then, at the viewing.  After a few phone calls with two other parties who had to agree to the price, the vendor accepted our offer, we shook hands and went to the estate agent's office to sign an official offer letter and give them all the details they needed to get the compromis ready.

While we were at the office doing all this, the agent called the vendor to check on something and was told that he had now accepted an offer of the asking price from someone else.  We said we were also prepared to pay the full asking price, and the agent told the vendor this and informed him that he felt that since he had already accepted our offer once, he should give us the opportunity to match the other buyer's price.  The vendor told the agent to call his other agent.  It turned out that this other agent had subcontracted to the agent we viewed with and if we had bought the property the first agent would have had to share his fees, so he wanted the vendor to go through him (complicated even more since this agent was the vendor's cousin so obviously they wanted to keep the money in the family!!)

We even tried offering to pay in excess of the asking price and both sets of fees to the agents, so neither of them would lose out and the vendor would get more money.  However, they insisted that they had already agreed with the other buyers - never mind that they had agreed with us first!  The extra silly thing about this is that we had cash waiting in the bank, whereas the other buyer (a Canadian) was reliant on a French mortgage that he hadn't yet applied for and wanted a clause suspensive allowing him to withdraw in the event his application wasn't successful.  It still doesn't make sense to us!  A comment by the local cafe owner was that perhaps the vendor preferred to sell to Canadians rather than English since they didn't have any of those in the town yet?  Makes as much sense as any other explanation I guess! 

I've also been told by some agents that if you offer the full asking price the vendor has to accept the offer and sell.  However just as we were gazumped on this property, I've heard of other properties where people have ended up bidding against each other even though an offer has already been accepted by the vendor.  If you really, really want the property its probably best to bid for it and if they accept, have the agent type up the compromis the same day, sign it and then rush back and get the vendors to sign it!

[Pangur]

Thanks for the feedback.  Well, I suppose all we can do is give it our best shot and hope we are first and highest 

 

[Will]

The 'asking price' which has to be accepted is the 'net vendeur' figure - i.e. the sum the seller will actually receive (not including fees).

As mentioned above, fees can vary considerably. It also sometimes happens that although different agents might be selling what looks like the same house, it may have different parcels of land and/or outbuildings attached - it comes down to what the individual agent thinks will offer the most saleable proposition. So when comparing prices do make sure exactly what the price includes. Also remember that most agents show a price that includes their fees, if you buy directly through a notaire the price shown will usually be the net vendeur figure, to which the notaire's negotiation fee (2.5% to 5% I think) must be added.

Although the French system protects to some degree against gazumping, things can still go wrong sometimes, as in the example above, particularly in the period up to signing the compromis, when there are several agents and notaires involved. It seems to avoid a lot of arguments and heartache for buyers if, once an offer is accepted, the agent gets the seller's signature first on the compromis de vente, then either gets the buyer to sign or sends the compromis for signature.

Remember too that although people have had offers of as much as 30% or more below the asking price accepted this is not (or should not be taken as) the norm. It's really an indication that the house was drastically overpriced in the first place. Unfortunately there are a lot of drastically overpriced houses on the market at present (due to sellers' unrealistic expectations just as much as, or even more than, optimistic agents' valuations). It's a buyer's market at present, but that doesn't mean all houses are too expensive. If it looks a fair price to you, particularly in comparison with similar properties, it is probably correctly valued, to sell, and an asking price offer will secure. If it looks too dear, then by all means risk an offer.

[Pangur]

Thanks Will, the 'net vendeur' explanation makes a lot of sense and the seller signing first tip should reduce the number of sleepless nights!

 

[Teamedup]

Panqur, was this house price an example? I seem to remember you being up towards Geneva and I just never imagined prices being like that up there.

 

[sophie.b]

Although it may be preferable to get the buyer to sign the compromis first, this is not the norm and many vendors will refuse to do this.  They have no "7-day cooling off" so when they sign, they are locked into the sale and many prefer to have the buyers ink on the compromis first.

[Pangur]

You're right TU, just an illustration.   

I don't think you'd be able to get a one bed apartment around us for that kind of money.  We certainly didn't move here for cheap houses...

[Teamedup]

That is what I thought. Tends to be a bit dear in that neck of the woods from what I have been told.

[dinks]

If buying in France do as much research on that house that you won’t, as you can ask as many peps as you can find. Ask all the agents what they know it helps.

Most places in France are over priced my wife and I were ready to pay 135000 euros for are house, to us it was worth it.

But with in a week we found out that the guy had been trying to sell it for 14 months he had had offers of 130000 and turned them down.

We ended paying 76000 including fees because we found out that if he had not sold it to us in march this year the bank would have owned it buy the end of April the 1^{st .}

 He had bought it 8 years before for 60000 euros and in the end was happy to walk away with next to nothing, Rather than loss it, all and all we did was to ask as much as we could !!    

[dinks]

If buying in France do as much research on that house that you won’t, as you can ask as many peps as you can find. Ask all the agents what they know it helps.

Most places in France are over priced my wife and I were ready to pay 135000 euros for are house, to us it was worth it.

But with in a week we found out that the guy had been trying to sell it for 14 months he had had offers of 130000 and turned them down.

We ended paying 76000 including fees because we found out that if he had not sold it to us in march this year the bank would have owned it buy the end of April the 1^{st .}

 He had bought it 8 years before for 60000 euros and in the end was happy to walk away with next to nothing, Rather than loss it, all and all we did was to ask as much as we could !!   

Dept 24 

[Teamedup]

LOL Dinks around here you'd get a small parcel of land or a one bed apartment for 135K euros. 76K euros would get you a studio around 20m²,  if you were lucky, but perhaps that would be hard to get too for such a paltry amount.

France too expensive, well at the prices you are quoting are not those of thriving areas in France. There are areas of France that compare easily to the UK. And I would imagine that the majority of the french population lives in such areas.

[Debra]

It seems to avoid a lot of arguments and heartache for buyers if, once an offer is accepted, the agent gets the seller's signature first on the compromis de vente, then either gets the buyer to sign or sends the compromis for signature.

We were told by one agent that it's illegal for the seller to sign first - hence we've always accepted since that we have to sign first, then the seller, and the binding date (for the 7 day cooling off period) starts on the date the seller adds his signature to the contract.

[Debra]

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[Teamedup]

No I'm not saying that the french don't live in the Charente and Dordogne. But over x number of years people, especially the young  have been leaving these regions to find work in others like the one I live in. Prices have crept up here in the Rhone Alps over the years and there is a housing shortage in this immediate region which has boosted prices even more. Not in silly english ways, but never the less, they have been and are going up. There is work especially in specific sectors and people come from all over France to work here. Therefore I would say that this area is thriving.

Until I start hearing of people being mute'd from here to say the Dordogne or Charente as their companies have need of them there, I would not imagine that such areas are thriving but maybe all the incoming brits are keeping these regions ticking over.  As it is around here, I hear of people being moved up to near Geneva, to Toulouse, to Marseille, Lyons, Paris and Lille. And you'll not find cheap housing stock in these places either.

And those poor sods you bought from not being able to cover their mortgage....... we haven't had a recession in the housing market here, you have just told me that things are serious there other wise why would they have been so desperate to sell? Very very sad.

 

[Debra]

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[Teamedup]

And I still do think that these are paltry amounts. What could you buy in North Yorkshire for that amount? (I'm from North Yorkshire myself).  And what can you  buy in many regions of France for that amount, next to nothing.

If somewhere is cheap then it is cheap for a reason and not because the locals are extraordinarily generous. No way prices in the Charente or Dordogne will be like those of here or Lyons or Paris unless these areas start thriving and the  people coming in are coming for jobs. I suspect that the influx of foreigners has often saved such regions and has them keeping their heads above water now and not slowly dying as many of them were.

 

[Debra]

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[Arkon]

[quote]Although it may be preferable to get the buyer to sign the compromis first, this is not the norm and many vendors will refuse to do this. They have no "7-day cooling off" so when they sign, they are ...[/quote]

Our Notaire laughed his head off yesterday when we asked about Vendors signing first!

Apart from the 7 day cooling-off period not being applicable for the vendor, this means the vendor would have to say when he signs that he would not accept any clauses suspensives, in order to protect himself, a situation which a lot of buyers would probably then find restrictive!!!

In answer to another poster's question, the 7 day period starts not from when the vendor signs, it starts from the day after the day that the Notaire sends out the copy of the Compromis signed by both parties by special post. I'm not sure if any more time is allowed for posting to addresses abroad, maybe someone else knows definitively

[Will]

Normally, if a compromis de vente is sent by post, it will be sent by a method that requires signature as proof of delivery. The seven-day period will start from when the buyer's copy is signed for. Some notaires etc may do things differently - there is no laid-down procedure as far as we know (and even if there is, notaires tend to be a law unto themselves).

Any clauses suspensifs must be in place before the compromis is signed by any of the parties concerned - to add them after buyer or seller has signed would make a mockery of things (although we have heard of people trying to add conditions or alter the plans after signature). If a condition has been missed or changes are required then a new compromis should be drawn up, and fresh signatures obtained. The compromis is a legal contract, and cannot be altered without the agreement of all parties.