French property law changes may hit condo sales

The ALUR French property law requires so much paperwork that it could delay condo sales or undermine the security of contracts, warns the FNAIM French professional association
New property regulations in France could delay the sales process of condos and undermine the security of contracts, it is claimed.

The controversial ALUR Act, the French housing law passed in March, requires sellers to attach extensive documentation to a preliminary sales contract, reports WorldofProperties.com, the website of the International Consortium of Real Estate Associations (ICREA).

The French professional association FNAIM warns that the documentation requirements can unnecessarily slow and complicate the sales process and seriously undermine the security of contracts.

While some documents should already be in the hands of the seller, others must be requested, for example from condominium trustees, which prolongs the process.

Among the mandatory attachments are building regulations and a division description; both of which can be very detailed. Other documents include general meeting minutes of the past three years, a technical evaluation of building, building maintenance records, the amount of current expenses paid by the owner seller two fiscal years prior to the sale, and more.

FNAIM argues that to conclude a real estate transaction, parties are forced to gather detailed documentation, including some in duplicate or triplicate, and some that have to be signed and registered within 10 days, further complicating the situation.

The law does not address what happens if the preliminary contract does not contain all the required attachments, but an associated penalty is that the seven-day period granted to buyers to withdraw their offer is extended if all required documentation has not been sent or delivered by hand, creating a significant risk to the seller.

FNAIM argues that client safety should be the primary consideration. From 2015, condominiums managed by a professional trustee may establish an extranet site to help documentation. But for others, including those managed by a volunteer trustee, the difficulties will remain, it says.

Source: www.opp-connect.com