Notary fees on land purchase: how the specific calculation works

Notary fees on land: why the calculation is specific

When people talk about notary fees, they usually think of buying an apartment or a house. But for a land purchase (building plot, agricultural land, leisure plot), the structure of the fees is similar yet has specific features that matter a lot in any buy or rent analysis.

In a simulator like buy-or-rent.net, notary fees related to land are captured through the parameter montant_fn (total notary fee amount). If you mis-estimate it, your comparison between buying and renting can become completely biased, especially if you buy the land first and build later.

What makes up notary fees when you buy land?

Despite the name, not all "notary fees" go to the notary. For a land purchase, they usually include:

• Transfer duties and taxes (state, local authorities, land registry tax): typically the largest part, around 5–6% of the land price for second-hand land.
• Notary’s fee (regulated scale): roughly 0.7–1% of the price depending on brackets.
• Disbursements: amounts the notary pays on your behalf (land registry, surveyor, planning documents, mortgage registration, etc.), usually a few hundred euros.
• VAT: mainly on the notary’s fee and some disbursements.

Overall, for second-hand land (sold by a private individual or outside the VAT-on-property regime), total notary fees usually land between 7% and 8% of the price, which is consistent with typical default values for montant_fn on existing property in simulators.

For a new building lot sold by a developer under the VAT regime, the land price is subject to 20% VAT but registration duties are reduced. In that case, notary fees excluding VAT are closer to 2–3%, like for a new-build property. In a buy or rent simulator, distinguishing these two situations is critical.

Second-hand land vs new lot: impact on montant_fn

The parameter montant_fn in the simulator represents the total notary fees paid at purchase. For a land purchase, you must therefore:

• Identify whether the land is second-hand (no property VAT) or new / serviced lot (subject to VAT).
• Apply an appropriate percentage (typically 7–8% for second-hand, 2–3% for new).
• Add any specific extra costs (easements, detailed boundary survey, etc.).

Example 1: second-hand land at €80,000

Assume a building plot sold by a private owner for €80,000, no property VAT.

• Notary fee assumption: 7.5%
• montant_fn = €80,000 × 7.5% = €6,000

Indicative breakdown:

• Transfer duties and taxes: ~€5,000
• Notary’s fee: ~€800
• Disbursements and formalities: ~€200

Total acquisition cost for the land:

• Land price: €80,000
• Notary fees (montant_fn): €6,000
• Total to fund: €86,000

From a buy or rent perspective, these €6,000 are an upfront non-recoverable cost (unless capital gains later compensate it). The simulator compares this immobilised capital with what it could generate if invested at a given investment rate while you keep renting.

Example 2: new serviced lot at €100,000 incl. VAT

Now assume you buy a serviced plot in a new development for €100,000 VAT included from a developer.

• Land price incl. VAT: €100,000 (20% VAT already in the price)
• Notary fee estimate: 3% (new property regime)
• montant_fn = €100,000 × 3% = €3,000

Total acquisition cost:

• Land: €100,000
• Notary fees: €3,000
• Total: €103,000

With identical pre-tax land values, the fiscal structure (VAT + reduced duties) can lower montant_fn but increase the VAT-included price. In a buy or rent comparison, this is not neutral: you pay less in notary fees but more in VAT-built price.

How land notary fees interact with your mortgage

If you finance your land purchase with a mortgage, notary fees can:

• Be paid in cash from your savings; or
• Be rolled into the mortgage, if your lender allows it.

With a loan rate around 3.6% and borrower insurance at roughly 0.25–0.45%, financing notary fees increases the total cost of the project. A simulator will take into account:

• Loan amount = land price + possibly montant_fn;
• Monthly payment calculated with loan rate and insurance rate;
• Potential prepayment penalties if you sell early (capped at 3% of remaining principal or 6 months of interest).

Example 3: impact of financing notary fees

Re-use the second-hand plot at €80,000 with €6,000 notary fees (montant_fn).

• Option A: you pay €6,000 in cash and borrow only €80,000.
• Option B: you borrow €86,000 (land + notary fees).

Over 20 years, at 3.6% interest (insurance excluded):

• Monthly payment on €80,000: about €465/month.
• Monthly payment on €86,000: about €500/month.

Difference: ~€35/month, more than €8,000 over the term, plus insurance. In a buy or rent analysis, those €6,000 of notary fees financed with debt thus weigh twice: as acquisition cost and as interest cost.

Land + house vs existing home vs renting

In real life, many households compare buying land and building with buying an existing house or continuing to rent. For a robust comparison, you need to:

• Isolate notary fees on the land (montant_fn);
• Add the construction cost (subject to VAT but no notary fees);
• Factor in future property tax (often higher for a larger new house);
• Include annual inflation and property tax revaluation in your projections.

This overall project can then be compared in the simulator to a scenario where you keep renting, your rent increases with the index (IRL or similar), and you invest your savings at a given investment rate. The montant_fn parameter is the first building block of your total cost of ownership.

Land, notary fees and your buy or rent strategy

Deciding to buy land is not just about price per square metre. Within a buy or rent framework, land notary fees have several roles:

• Initial cost: they increase the upfront capital compared to renting.
• Holding period: the shorter the holding period, the heavier these fees weigh, as they are spread over fewer years.
• Capital gain potential: in high-demand areas, land value may rise fast enough to offset notary fees and more.
• Financial alternative: if you keep renting instead of buying land, the equivalent capital (land price + montant_fn) can be invested at an investment rate (e.g. 4–6% in ETFs), building a different type of wealth.

Example 4: spreading notary fees over time

You buy a plot for €100,000 with €7,000 notary fees (7%), so montant_fn = €7,000. You sell the land at the same price three years later.

• Net cost: you effectively "lost" €7,000 (ignoring other costs), i.e. about €2,333/year.
• If you had rented and invested those €7,000 at 4%/year, you would have around €7,875 after three years.

If instead you sell the land for €120,000 after 10 years:

• Gross capital gain: €20,000.
• Initial notary fees: €7,000.
• Net gain before capital gains tax: €13,000, or €1,300/year, before considering leverage from the mortgage.

This shows how the impact of land notary fees depends heavily on your holding period and local land price trends. A robust buy or rent simulator helps you visualise these dynamics.

Other costs around land you must not ignore

Notary fees are only one part of the total cost of a land purchase. For a realistic buy or rent comparison, you should also consider:

• Agency fees if a real estate agent is involved (typically 3–5% of the land price, sometimes paid by the buyer).
• Servicing and connection costs (water, electricity, sewer, telecoms): from a few thousand to tens of thousands of euros.
• Soil studies and any special foundation work required.
• Boundary survey costs where not already done.
• Future property tax and its yearly revaluation.
• Borrower insurance on the mortgage and build-related insurances.

The montant_fn parameter therefore captures only the visible tip of the iceberg. But because it is paid upfront and often financed through debt, it has an outsized impact on your overall calculation.

How to set montant_fn correctly in the simulator

To use a tool like buy-or-rent.net effectively for a land purchase, here are some practical steps:

• Identify land type: second-hand (7–8%) or new (2–3%).
• Ask your notary for a written estimate before signing any purchase agreement.
• Enter montant_fn as an amount in euros in the simulator based on that estimate.
• Test several scenarios: e.g. 6%, 7.5% and 9% to see sensitivity.
• Look at the time dimension: the longer you keep the land, the more these fees are "diluted".

The results will not replace professional advice, but they will help you see at which horizon a land + build project can start to compete with renting, given your rent level, annual rent increase, loan rate, and your alternative investment rate.

Conclusion: land notary fees are key, but not everything

Notary fees on land are specific in structure, yet follow the same logic as for housing: transfer duties, notary’s fee, disbursements. For your buy or rent thinking, the montant_fn parameter is essential, as it can run from €2,000 to well over €15,000 depending on land price and tax regime.

Whether buying land is attractive will depend on your holding period, local market dynamics, full build cost, mortgage rates, inflation, and the returns you can get by investing instead while renting. There is no universal answer: it depends on your situation, your goals, and your risk tolerance.

The numerical examples here are general and do not constitute personalised financial advice. To assess your own case, adjust montant_fn and compare your buy or rent scenarios using a dedicated tool.

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