Notary fees based on new rates
The reduction in notary fees, which entered into force at the start of 2021, involves a reduction in the emoluments of notaries: the decrease therefore concerns the rates of remuneration of notaries, but not taxes or registration fees and costs. This new regulatory tariff was scheduled to apply from May 1, 2020. Its official entry into force was postponed to January 2021 by the specific circumstances related to the Covid-19 crisis. The overall reduction in the cost of notarial acts has been assessed by the Superior Council of Notaries at 1.9% on average. This is an average decrease, as some acts are subject to a greater price reduction than others.
The impact of the reform of notarial fees on real estate
In the case of real estate sales, the notarial fees are calculated according to the value of the property concerned, according to 4 different scales. These rates have been reduced by 1 to 2%. The portion invoiced by the notary thus went to:
- 3.87% instead of 3.95% for a transaction of less than 6,500 euros, a decrease of 2.03%
- 1.60% instead of 1.63% for a property between 6,500 and 17,000 euros, i.e. 1.91% decrease
- 1.06% instead of 1.09% for a real estate purchase of 17,000 to 60,000 euros, i.e. 1.04% decrease
- 0.81% instead of 0.80% for a transaction over 60,000 euros, a decrease of 1.84%
In fact, this decrease has a fairly low impact on real estate purchases: the savings made by the purchaser or by the deed-in-hand seller on a real estate transaction of 300,000 euros are thus estimated at 53 euros.
A novelty, however, may allow other savings to be made: the increase in the discounts that notaries are entitled to grant. Until now, the latter could apply a 10% discount on their fees, in the case of transactions over 150,000 euros and only on sums exceeding the amount of 150,000 euros. With the new decree which entered into force on January 1, 2021, they will be able to increase these discounts to 20% and apply them to transactions of at least 100,000 euros (also on the sole amount exceeding this basis).
Still on a transaction of 300,000 euros, the discount will therefore be on 200,000 euros: the savings could therefore rise to 324 euros with a notary who decides to apply a maximum discount for commercial reasons.
The case of other notarial acts
The reduction in notary fees relates of course to other acts, which, moreover, can register a much greater reduction than that concerning real estate transactions. The PACS agreement before a notary, for example, has seen its price drop by more than 55%. Mortgage release, too, is decreasing globally due to a radical change in pricing policy: until then, releasing a property from a mortgage required a notarial deed charged around 0.13% of the property's value. For a mortgaged property worth 200,000 euros, the release amounted to 260 euros. From now on, the mortgage release deed is charged 150 euros, regardless of the value of the property.
The reduction in notary fees that came into effect at the dawn of 2021 therefore has a relatively overall impact for buyers or sellers paying the fees in the case of a deed-in-hand sale. Only the emoluments of notaries are in fact subject to a reduction, while taxes and fiscal duties which represent 80% of notary fees have not fallen. However, savings of a few hundred euros can be made. Small asset transactions are also encouraged by a higher rate of decline.
Do you want to know more about taxation in 2021 or benefit from personalized support for your real estate project? Do not hesitate to contact our advisers in the Barnes Côte Basque agencies in Biarritz, Saint-Jean de Luz and Hossegor!