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FRANCE EXPLAINED

Can you really buy an ‘occupied’ property in France and then wait for the owner to die?

It's an unusual and - some might think - morbid arrangement, but France really does have a type of property sale that allows elderly people to sell their homes, while retaining the right to keep living there until their death. Here's how the 'viager' system works.

Published: 10 June 2024 11:07 CEST
Can you really buy an 'occupied' property in France and then wait for the owner to die?
It's common to see adverts for property sold 'en viager' in France, and some real estate agents even specialise in this type of purchase. Photo by THOMAS SAMSON / AFP

Viager is a type of real estate transaction in France, in which you buy a property, but can only move in once the vendor has died.

Though seemingly a bit morbid, it is quite popular in France, and has great potential benefits for both the buyer and the seller – as well as some pitfalls.

For the buyer there is the chance to snap up a bargain as houses or apartments sold en viager are usually priced well below their market value. For the sellers – who are usually elderly – it’s a chance to free up some of the value in their property, while being able to stay in their home for the rest of their life.

There are a few different types of viager arrangement, but in most cases the buyer pays an initial down-payment and then a monthly annuity to the occupier. If the seller dies soon after the arrangement then the buyer lands themselves a bargain – however if the seller lives for a long time it can rapidly become less of a good deal.

Explained: How France’s ‘viager’ system works for buyers and sellers

In 1965, a 90-year-old French lady called Jeanne Calment sold her home en viager to 47-year-old André-François Raffray. From then on, Raffray would pay her 2,500 francs a month, expecting to move in once the elderly woman inevitably passed away.

Calment died in 1997 at the age of 122, with the title of world’s oldest woman.

She also outlived Raffray – he died in 1995, never having had a chance to live in the home he had bought, and having paid more than double the house’s value over a thirty year period.

Such stories are exceptional – but illustrate the gamble of buying en viager. The buyer is not allowed to know anything about the state of health of the seller, only their age.

You can find a full explanation of how the different types of viager systems work HERE.

Despite the possible drawbacks, it remains popular in France and you will often see properties advertised as en viager if you are browsing the windows of French real estate agents.

It is often regarded as a good way to invest, particularly if you are not expecting to live in or make use of the property for an extended period of time. Additionally, notaire fees are typically reduced to only three percent.

As with any type of contract, however, it’s crucial to fully understand what you are signing.

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PROPERTY

Who is exempt from France’s 2024 property tax declaration?

The deadline is fast approaching for property-owners to have completed the property tax declaration - here's a look at who needs to do this, who is exempt and the penalties for missing the deadline.

Published: 19 June 2024 13:07 CEST
Who is exempt from France's 2024 property tax declaration?

The deadline to have completed the déclaration d’occupation, also known as the déclaration de biens immobiliers, this year is June 30th. 

If you’re declaring online, you have until 11.59pm to have completed the form, if you’re declaring on paper you need to ensure that your form reaches the tax office by June 30th (which is a Sunday, so you will need to factor that in if you are returning it by mail).

After a raft of technical problems last year, French tax authorities have promised ‘improvement’ to this year’s declaration, and have also made the form available in a paper version for those who either don’t have internet access or who aren’t confident with online processes. 

Who has to do it?

The declaration must be completed by anyone who owns residential property in France – whether or not they are French residents. This therefore includes foreign second-home owners.

The declaration must be done regardless of what you use the property for – whether it is your main home, a second home or is rented out on a long or short term basis.

However, unlike the income tax declaration (déclaration des revenus) this is not an annual task – if you filled out the declaration last year and nothing has changed, there is no need to do it again.

READ ALSO Vocab guide for the French property tax declaration

What about if I have bought or sold a property in the last year?

The property tax declaration concerns your situation on January 1st 2024 – if you have bought a property in France since that date there is no need to do the declaration this year, although you will have to do it next year.

Property taxes are also charged based on the situation on January 1st, so if you have sold your property since January 1st you will receive one last property tax bill (which usually arrive in the autumn).

If the use of your property has changed in the last year – ie your second home is now your full-time residence or vice versa – you will need to fill out the declaration again detailing the current situation.

READ ALSO How to fill out the 2024 property tax declaration

Vacant property/ renovation projects

If your property is vacant you won’t pay taxe d’habitation, but you may be liable for one of the two ’empty homes tax’ charges – taxe sur les logements vacants (TLV) and taxe d’habitation sur les logements vacants (THLV) – depending on your local authority rules.

Be aware that ‘vacant’ has a specific meaning in tax terms – it is a property that is both unoccupied and unfurnished. A second-home is not unoccupied, even if you haven’t visited it for months or even years.

If you have bought a property as a renovation project, you have the option to declare it inhabitable (uninhabitable) which can see your two property taxes reduced or excused altogether for a period of up to two years. This would normally apply in cases of very derelict properties, for example where there is no water or electricity, no functioning bathroom or a roof with holes in it.

The easiest way to do this is to visit your local tax office to find out what rules are in place in your area.

Why do I have to do this?

The property tax declaration gives tax authorities the information that they need to set your property tax bills.

Property taxes in France come in two types; taxe foncière which is paid by all property owners – bills for this usually arrive in September – and taxe d’habitation, bills for which usually arrive in October or November.

Recent changes to the tax system mean that only second-home owners now pay the taxe d’habitiation – which is why the tax office needs to know what you use the property for.

READ ALSO How much should I expect to pay in French property taxes?

What if I miss the deadline?

There is a flat fine of €150 for missing the deadline. However, if you don’t provide information to the tax office they will likely send you a bill anyway, based on an estimate.

These estimates can be much higher than your real bill, and challenging them will require some complicated conversations with the tax office.

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