This article explores the differences in notary fees when purchasing new versus old properties, highlighting the significant variation in transfer duties (DMTO) that can affect overall acquisition costs. New properties typically incur a DMTO rate of 0.7%, while older properties average around 3.80%. Additional taxes, such as VAT and development taxes, further influence costs. The article also notes potential reductions in notary fees based on property value and real estate promotion scales.
Understanding Notary Fees for New vs. Old Properties
A reader has raised an interesting question regarding the discrepancy in “notary fees” associated with new and old properties. Let’s delve into the details to clarify this topic.
What are Notary Fees?
Emmie, the term “notary fees” refers to the costs incurred during the acquisition of a property. These fees primarily consist of taxes owed to the Public Treasury on behalf of both the State and local authorities. Key components include transfer duties (DMTO), land publicity, and the Real Estate Security Contribution (CSI). Additionally, there are the notary’s fees, which are calculated based on fixed or proportional scales. Disbursements also come into play, which involve reimbursement for expenses that the notary has incurred in relation to the acquisition, such as land registry extracts and administrative documents.
While the overall fees, disbursements, and notary honorarium are generally comparable between new and old properties, the DMTO rate shows a significant difference, as noted by the National Agency for Housing Information.
Comparing DMTO Rates for New and Old Properties
In the realm of new real estate, the DMTO rate stands at 0.7%. Conversely, in the market for older properties, this rate typically hovers around 3.80%. However, local authorities have the power to adjust this rate, potentially lowering it to 1.20% or raising it to 5% starting from April 1, following a recent increase of 0.5 points as outlined in the 2025 finance law.
What accounts for this variation in transfer duties between new and old properties? According to Nicolas Bosquet, a notary in Binic, Côtes-d’Armor, “It’s the VAT applied to the purchase of a new property.” To illustrate, he points out that for a new property priced at 250,000 euros including tax, the buyer pays 41,667 euros in VAT, with the pre-tax price being 208,333 euros. It’s important to note that real estate VAT is generally 20% in mainland France and Corsica, and 8.5% overseas, with potential reductions for certain social programs.
Moreover, when acquiring a new home, buyers must also factor in the development tax, which varies based on the property’s location and local authority regulations. Additionally, there’s a preventive archaeology tax set at 0.40%, with the tax base also varying according to location and developments linked to the property.
So, what does this mean for the actual acquisition costs when purchasing new versus old properties? For a new property in Morbihan priced at 250,000 euros, the acquisition costs are approximately 6,271 euros, which includes 1,787 euros in duties and taxes, primarily from the TPF. In stark contrast, the acquisition costs for the same price in the old property market would total around 18,758 euros, with 15,418 euros attributed to duties and taxes. In both scenarios, the notary fees would amount to 2,873 euros, according to the ANIL simulator.
Lastly, it’s worth mentioning, Emmie, that the notary’s fees can be reduced by a few percentage points based on the scale of the real estate promotion for the purchased property, as explained by Nicolas Bosquet. This also applies in the older market, particularly for high-value transactions, where discounts of up to 40% may be available for operations exceeding approximately 8 million euros.