Promise to sell isolated building land

Verified 27 June 2023 - Legal and Administrative Information Directorate (Prime Minister)

You are considering buying or selling building land (excluding subdivisions). You're going to sign a promise to sell. It is a contract that prepares the final act of sale. It takes the form of a unilateral promise of sale if it is signed only by the seller or a sales compromise if it is signed by the seller and the buyer.

We take stock of the content, form and signature of these 2 documents.

One-sided promise of sale

The unilateral promise of sale is signed only by seller. She hired him to sell his land to a specific purchaser and to a price fixed in the promise.

The seller cannot leave the property on the market or sell it to another buyer for the duration of the promise.

L'buyer has a purchase option within a period defined by the two parties. It gives him the right to buy the property without requiring him to do so.

The promise of sale includes the following information:

  • Contact Information from seller and buyer
  • Detailed description of the land and its exact surface (address, cadastral references...)
  • Price sales and methods of payment (with or without the help of a mortgage)
  • Suspensive condition of loan if you take out a mortgage
  • Condition suspending the award of a building permit if you ask for one
  • Existence or non-existence of bounding of the land
  • Existence or absence ofmortgage and bondage on the ground
  • Amount of fees the seller or supplier (if a seller or supplier is involved) and the name of the person to pay the fee
  • Amount of thefixed asset allowance the land (in return for the seller's commitment to sell exclusively to the buyer)
  • Period of validity of the promise to sell
  • Deadline for signature of the bill of sale (typically 3 months after the sales promise is signed)
  • Deadline granted to the buyer for waive purchase option
Documents attached to the promise of sale

The promise of sale takes the form of a privately signed document or a authentic instrument.

When the period of validity of a promise to sell signed by a natural person exceeds 18 months, it is mandatory to sign an authentic instrument.

The promise can be signed in paper or electronic form.

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Paper medium

It is made 2 original copies (1 for the seller, 1 for the buyer), unless a unique original is kept by a professional (notary, real estate agent).

Electronic medium

The procedure for signing and keeping the document must enable each party to have a copy of the promise or to have access to it.

To be valid, the unilateral promise of sale under private signature must be registered at the tax office by the seller or buyer.

Who shall I contact

The process is done within 10 working days from the date of acceptance of the promise by the buyer (in principle the day of its signature).

Check-in costs €125.

One fixed asset allowance land may be requested from the buyer. It is paid in return for the seller's commitment to sell his land exclusively to the buyer.

The allowance is paid on the day the promise to sell is signed. It is freely fixed by the parties. In principle, it represents 5% to 10% the selling price.

It is recorded in a blocked account. The funds are unavailable until the conclusion of the contract of sale.

If the suspensive conditions as provided for in the promise do not come true, the compensation shall be paid. The buyer must provide proof that he has done the corresponding steps (request for a loan from the bank, request for city planning in town hall...).

If the beneficiary of the promise renounces to buy or if he does not indicate his acceptance within the period for the exercise of the option, the compensation shall be retained by the owner.

When the sale comes true, the amount paid shall be deducted from the selling price to be paid.

Please note

Capital cost allowance is mandatory when the promise to sell is signed by a natural person has a duration of more than 18 months.

The buyer of a building plot does not have the right of withdrawal.

The seller can no longer change their mind after accepting thepurchase offer.

In principle, the promise provides for and fixes the following deadlines:

  • Typical 3-month period to lift the option (buyer's decision to purchase the property)
  • Time limit for completion of all or each of the suspensive clauses (e.g. 2 months for a building permit)
  • Deadline for signing the authentic bill of sale after the option has been exercised

The promise may provide for a extension automatic in case of insufficient initial time, for a delay due to difficulties in obtaining certain parts.

Before the end of the period set out in the promise, the two parties may also decide to extend it. They're writing a agreeable the contract in which they specify the purpose of that extension.

The date of signature of the bill of sale is thus shifted.

Please note

In the departments of Haut-Rhin, Bas-Rhin and Moselle, the promise to sell must be followed by an authentic bill of sale within 6 months. The parties may not agree to a longer period.

Sales Compromise

A sales compromise is a pre-contract in which a seller and a prospective buyer commit each other to sell and acquire a good at a certain price.

The compromise defines the terms of the sale. They cannot be modified without the agreement of the two parties.

The sales compromise shall establish the agreement of the parties on the property (the land) and on the price. It precisely defines the terms of sale.

In particular, it shall contain the following information:

  • Contact Information from seller and buyer
  • Detailed description of the land and its exact surface (cadastral references, address...)
  • Price sales and methods of payment (with or without the help of a mortgage)
  • Loan suspension condition if you take out a mortgage
  • Condition suspending the award of a building permit if you ask for one
  • Existence or non-existence of bounding of the land
  • Existence or not of mortgage, of bondage on the ground
  • Amount of fees the seller or supplier (if a seller or supplier is involved) and the name of the person to pay the fee
  • Amount of security deposit
  • Deadline for signature of the bill of sale (typically 3 months after the sales promise is signed)
Documents annexed to the compromise

If the seller or buyer knows of information which is of decisive importance for the consent or agreement of the other, he must inform him of this in the compromise.

The sales compromise takes the form of a privately signed document or a authentic instrument. It may be signed in paper or electronic form.

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Paper medium

It is made in 2 original copies (1 for the seller, 1 for the buyer), except when a unique original is kept by a professional (notary, real estate agent).

Electronic medium

The procedure for signing and keeping the document must enable each party to have a copy of the promise or to have access to it.

FYI  

An authentic instrument is always required for a sales compromise signed by a natural person with a validity of more than 18 months.

A sum corresponding to 5% to 10% of the selling price may be requested from the buyer on the day of signature of the compromise.

This security deposit is cashed and blocked until the conclusion of the contract of sale on the escrow account of the notary.

If the suspensive conditions which are provided for in the compromise are not realizedWell, the money's back.

If buyer forgoes purchase, it is retained by the owner.

When the definitive act of sale is signed, the amount paid shall be deducted from the selling price.

The buyer of a building plot does not have the right of withdrawal.

The seller can no longer change their mind after accepting thepurchase offer.

In principle, the compromise distinguishes and sets out the following deadlines:

  • Time limit for completion of all or each of the suspensive clauses (e.g. 2 months for a building permit)
  • Deadline 3 or 4 months until the signature of the authentic bill of sale

The compromise may provide for a extension automatic in case of insufficient initial time, for a delay due to difficulties in obtaining certain documents.

Before the end of the deadline set in the compromise, the two parties may also decide to extend it. They're writing a agreeable the contract in which they specify the purpose of that extension.

The date of signature of the bill of sale is thus shifted.

Please note

In the departments of Haut-Rhin, Bas-Rhin and Moselle, the sales compromise must be followed by an authentic bill of sale within 6 months. The parties may not agree to a longer period.

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