VEFA under French law

Understanding the VEFA process in France

Regarding the transfer of property, there is a distinction between VEFA contracts and construction contracts. In a construction contract, the property owner becomes the owner of the construction through accession. In contrast, in a VEFA contract, the property is transferred to the buyer immediately, for the existing construction and for the new construction as it is completed, either gradually or at the time of delivery.

A VEFA contract may also include a mandate, which allows the seller to carry out certain acts related to the construction of the building, such as entering into agreements for the use of common areas. To avoid disputes, the mandate should be specific and limited in scope. However, the mandate cannot be used to modify the provisions of a contract or the rules of a co-ownership agreement.

Buyer’s protection

In the case of the sale of buildings under construction, the seller is responsible for hidden defects under the guarantee scheme of the builder, regardless of whether the defect is apparent or not at the time of possession. The law provides the buyer with the right to take action within one year of the seller being able to be relieved of apparent defects. A clause that discharges the seller from any responsibility for defects before the deadline is not considered valid.

What are the advantages of this type of purchase?

In addition to the tax benefits associated with off-plan property purchase, the buyer also has the opportunity to personalize their home to their liking and needs. Regardless of the type of property purchased, the buyer has the right to make changes to the plans through what is called “buyer modification works” (TMA). As long as the requested changes do not violate regulations and are requested early enough to the developer, the buyer – for a fee – can modify the layout and equipment originally defined in the reservation contract.

Other advantages of purchasing a new property include assurance that the property meets the latest environmental and technical standards, particularly in terms of insulation, and the almost certainty – thanks to the various guarantees associated with this type of purchase – of not having to carry out any renovation work in the following ten years after the acquisition.