Buying an Apartment in Paris: Understanding Who is Responsible for the Building Expenses During a Sale

During the sale of an apartment, the seller and the buyer share the cost of building expenses and building works. Here is how it is organized.

🥐 The Common General Building Expenses

As highlighted in my article, Understanding the Monthly Expenses of Owning an Apartment in Paris, the building expenses cover the costs for the management and maintenance of the building. Each of the building's co-owners contributes to these expenses based on their share of common areas.

By becoming the owner of a property located in a collective building, one also becomes the owner of a small portion of the common areas—those parts of the building used or useful to all co-owners: the building's entrance, staircase, elevator, roof refurbishment, facade renovation, and so on.

🥐 How are Building Fees Calculated?

Each co-owner holds a share of these common areas calculated in proportion to the number of shares (tantièmes) they own in the building.

For the maintenance and administration of these common areas, an estimated budget is voted on annually by the co-owners in a general meeting. These constitute the ongoing charges of the building. The property manager (syndic) then issues a call for 'provisional charges,' representing a quarter of the annual budget, to each co-owner, typically payable on the 1st day of each quarter.

🥐 How to Get the Details of Building Fees?

The property manager (syndic) responsible for the building takes care of providing a breakdown of all condominium fees. Once a year, when compiling the complete accounts of the building, the property manager sends co-owners an itemized breakdown of charges by nature. This way, co-owners precisely know the cost of each expense, which is divided into two parts:

1. General expenses for the administration, preservation, and maintenance of common areas: electricity, maintenance of common areas, green spaces, minor repairs...

2. Special expenses for collective services and common facilities: elevator...

🥐 Payment of Anticipated Calls for Ongoing Charges

In principle, the payment of anticipated charges from the estimated budget is organized by law in a straightforward manner: the law requires the property manager to demand the total amount of quarterly charge provisions from the individual who is a co-owner at the time of the call for funds.

👉 Before the start of each quarter, the condominium property manager sends each co-owner a notice indicating the amount to be paid, along with the purpose of the expense: "request for payment of provisions."

Therefore, the seller who receives the call for payment of building charges at the beginning of the quarter is fully responsible for it, even if they sell their property during the quarter. The property manager does not handle the distribution of the cost of condominium fees between the seller and the buyer.

💡 Example: for a sale occurring on April 5, the seller is responsible for the charges of the second quarter. Thus, the seller pays the full condominium fees even though they own the property for only 5 days during the second quarter. The buyer, on the other hand, will receive the call for payment of charges for the third quarter, payable on July 1.

🥐 Who Should Pay the Building Fees Between the Seller and the Buyer?

The notary systematically includes in the sales agreement a distribution of building fees different from what is provided by law. To make this distribution of the payment of building fees more equitable between the seller and the buyer, the notary divides them between them based on the period of the year during which each of them was the owner.

👉 In practice, when the sale occurs during a quarter, the notary stipulates that the buyer will reimburse the seller for their share of the quarter's fees at the time of the sale.

💡 Example: for a sale occurring on June 5, the seller pays the entire second quarter of fees to the property manager. However, as the seller and the buyer have agreed on a fair distribution between them prorated for the time, the notary will ask the buyer, on the day of the deed of sale, to reimburse their share corresponding to the period from June 5 to August 31 to the seller.

🥐 Seller and Buyer: What Distribution at the Time of Charge Settlement?

After the sale, when the general assembly of co-owners approves the annual accounts of the building, it leads to a settlement of charges for each co-owner. If a reimbursement of charges is due, it goes to the co-owner of the unit. And if the charges were insufficient and need to be topped up, it is also the co-owner of the unit who is responsible.

Therefore, the buyer is the beneficiary or debtor of the charge differential, as they are the owner of the property at the time of the approval of the annual accounts by the co-owners gathered in a general meeting. This system has the merit of being simple and clear.

🥐 Building Works: Who Pays What During a Sale?

In addition to the anticipated budget for ongoing charges, the annual general meeting is also called upon to make decisions regarding exceptional charges.

These are expenses planned for major conservation, maintenance, or improvement works on the building and its common facilities. The general meeting of co-owners determines the amount and due date of these expenses.

🥐 The Legal Distribution of Building Works Between Seller and Buyer

The financial burden of works in the event of the sale of a condominium unit is determined by law. The rule is straightforward: works are owed by the co-owner at the time of the calls for funds. Therefore, the seller is responsible for those due up to the moment the sale is notified to the property manager by the notary, immediately after the sale. The buyer is then responsible for paying the amounts demanded after the sale.

⚠️ This legal distribution does not consider who voted for the works. As you may understand, this distribution sometimes leads the buyer to bear the cost of works voted on by the seller before the sale in a general meeting, but with payments occurring gradually with calls for funds to be settled after the sale.

🥐 Anticipating a Distribution of Building Works Between Seller and Buyer

The distribution provided by the law is not mandatory. It is possible to organize it differently. Indeed, there is nothing preventing the seller and the buyer from agreeing on another distribution. In this case, the notary adds a mention in the sales agreement and the deed of sale that organizes this distribution.

👉 Here is the distribution most often provided in sales agreements:

• Works voted before the Promesse remain entirely the responsibility of the seller.

• Works voted between the Promesse and the Deed of Sale are the responsibility of the buyer if the seller gives them the power to attend the general meeting of co-owners on their behalf (regardless of their vote). In this case, the seller commits to transmit the notice they received for the general meeting and to give power to the buyer to represent them as soon as they receive their convocation to the general meeting, usually at least 15 days before the scheduled date.
  

To conclude: Who pays what building expenses during a property purchase may seem technical and tedious but I hope this article helped to figure it out a bit better. As a legal expert and as YOUR advocate, I see it as another opportunity to further negotiate a property sales price for my clients.

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Happy property hunting, and may your French real estate journey be as smooth as a buttery croissant! 🥐 🇫🇷

As always, I love to read your comments and answer your questions.