Need to know: Buying a house as a group
Posted on April 4, 2014 by Susie Hollands
CAN A NUMBER OF PEOPLE BUY A HOME TOGETHER ?
French homes may be purchased on an individual or on a collective basis. However, if you intend to buy a home collectively, all buyers will be asked to jointly apply for the mortgage. For purchases made by two people or more, it may be advantageous to buy the home through a Civil Real Estate Company (“Société Civile Immobilière”, or “SCI”). A notary or a specialised solicitor can set up the SCI and provide you with advice about its benefits and implications.
What are the main advantages of an SCI?
- It could be easier to transfer a share of the home to someone else if you wish to sell your interest in the property;
- It may be easier to leave the home to your heirs.
What are the main disadvantages of an SCI?
- The fees to set up the company can be up to €1,500 and sometimes more;
- An SCI is a French company with administrative and financial obligations.
- An SCI is not a suitable vehicle for Furnished Rental, which is classified in France for Tax purposes as a commercial activity.
If you would like more details about SCIs, please contact your Notaire or a specialised solicitor.