Real estate prices have been falling in recent times and the market is filled with uncertainty. This has led to a resurgence in the popularity of the resale guarantee. This optional insurance can be taken out when buying property and protects the buyer from any financial loss they could experience if they have to resell their property after only a few years.
It’s important to note that the guarantee is triggered by specific events mentioned in the contract, such as death or disability due to an accident, redundancy, divorce, dissolution of civil partnership, multiple birth, or an external event like the construction of a nearby highway or commercial area.
“This guarantee gives assurance to the buyer, the bank, and even the seller who is selling through a real estate agency. It ensures that the property will sell at the listed price and will find a buyer faster,” says Christel Caterino, responsible for the real estate division of “NousAssurons”, a broker who offers this solution.
This coverage is sold by a real estate professional who will certify the property’s value. It is taken out when the compromise or the final act is being signed. The guarantee can either be offered as a commercial gesture or the buyer can subscribe to it by paying a one-time membership premium.
For instance, at “NousAssurers”, the subscriber can protect themselves against a capital loss of either 30,000 or 50,000 euros for seven years, regardless of the property’s value. The premium for this is 495 or 625 euros respectively. “The chosen purchase price includes the property’s price, notary and agency fees, and 50% of any work,” says Christel Caterino.
Here’s an example: A couple purchases a house for 210,000 euros, or 250,000 euros including all costs. If they divorce within the next 7 years and sell the house for 200,000 euros due to falling real estate prices, the 50,000 euros loss will be fully covered if the couple has subscribed to the best-priced resale guarantee at “NousAssure”.
However, there are some safeguards in place by the insurer. For instance, job loss must be due to dismissal and not a mutual termination agreement. And there’s a waiting period of nine months from the official sale signature for the resale guarantee to take effect for multiple births.
