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Preparing French Tenancy Agreement for the First Time

Stepping into a rental agreement is more than just signing a paper; it’s about securing your peace of mind. Known as contrat de location or bail, these legally binding documents are essential in defining the mutual obligations and rights of both landlords and tenants in France. So, get familiar with the specifics of your agreement—it's your blueprint for a harmonious rental experience.
Photo by Mina Rad on Unsplash

Section 1: Understanding the Legal Framework

    Section 2: Key Elements of a Tenancy Agreement

      Section 3: Legal Obligations of Landlords and Tenants

        Section 4: Prohibited Clauses and Tenant Protections

        Section 5: The Role of Statutory Surveys and Condition Reports

          Section 6: Ending a Tenancy

            Section 7: Resolving Disputes

              Additional Resources

                 

                Section 1: Understanding the Legal Framework

                A written tenancy agreement is obligatory if the property is the tenant’s principal home.

                If the property is the tenant’s primary residence, a formal tenancy agreement, or a contrat de location or bail, is required. Certain clauses are obligatory in a tenancy agreement.

                1. The lease agreement needs to include the tenant’s name and property information, the start and end dates of the tenancy, the kind of property usage, the rent and deposit amounts, and the property size.

                2. The lease agreement also specifies the day the tenant pays the rent.

                3. Furthermore, the landlord has to include a technical report on the rental and a Dossier de Diagnostic Technique (DDT). The DDT also includes the apartment’s energy performance report, or Diagnostic de performance énergétique (DPE). The report should cover the overall condition of the electrical installation. Failing to do so could result in a fine.

                You can find more details here on preparing a French tenancy agreement.

                French Landlord-Tenant Law

                French Landlord-Tenant Law is primarily governed by:

                1. The 1989 Tenancy Act (Loi n° 89-462 du 6 juillet 1989).

                This law outlines landlords’ and tenants’ rights and obligations in residential leases;

                2. Alur Law (Loi pour l’Accès au Logement et un Urbanisme Rénové)

                Implemented in 2014, this legislation established rules to oversee rent increases, support tenant protections, and improve the market’s transparency. It also involves guidelines for setting rent limits in areas with demand and establishing a universal rental guarantee system.

                3. Elan Law (Loi Evolution du Logement, de l’Aménagement et du Numérique)

                This law, enacted in 2018, was designed to streamline and update housing regulations. It includes provisions for faster eviction processes in case of unpaid rent, encouraging shared housing, and introducing new types of housing agreements, like mobility leases (bail mobilité).

                Are you wondering what lease options are available to you? Don’t hesitate to research various lease options to find the one that best suits your needs. 

                Section 2: Key Elements of a Tenancy Agreement

                Essential components of a tenancy agreement

                The rental contract covers all aspects, such as the length of a lease, landlords’ and tenants’ responsibilities and entitlements clauses regarding rent and security deposit, and penalties for any breaches of the agreement. Therefore, reviewing and comprehending all terms before signing the rental contract is crucial.

                The rental agreement, or the lease, officially recognizes the transaction and lists the rights and obligations of the landlord and tenant. 

                As mentioned, a landlord must provide a formal tenancy agreement, or contrat de location, if the property serves as the tenant’s primary residence. Many French landlords have their own agreements or standard agreements that can be purchased from most good bookshops.

                A few approaches to the preparation of a tenancy agreement are possible:

                    • Use one of the standard forms of pre-printed tenancy agreements that can be purchased from any good bookshop.

                    • Use of a property professional such as an estate agent or huissier who may themselves have a model contract that can be used.

                    • Preparation of an agreement by a notaire who will provide a tenancy agreement as an acte authentique.

                  In France, notarizing your agreement isn’t mandatory. But it can add an extra layer of security, making it easier to enforce in a dispute. Whether you go that route or not, ensure both parties have a signed copy.

                  Obligatory clauses

                  In a rental agreement, certain clauses are obligatory.
                  The agreement must include:

                  1. Names of tenant and landlord;

                  2. Address of the rented apartment;

                  3. If booked from the agency, the address of the rental agency;

                  4. Start and end date of the contract;

                  5. Contract renewal possibilities;

                  6. Obligations and responsibilities of tenant and landlord;

                  7. Amount of rent and deposit;

                  8. Insurance information;

                  9. A clause about rent increase;

                  10. Clauses about fines;

                  11. Methods for paying rent;

                  12. Inventory of the apartment;

                  13. Utility information (if it’s included in the rent);

                  14. Check-in and check-out information;

                  15. Information on notice periods for ending the contract.

                  Additionally, a landlord must annex the condition report—a technical report on the rental (Dossier de Diagnostic Technique)—and survey reports on energy performance (Diagnostic de performance énergétique) to the tenancy agreement.

                  Documents annexed to the lease

                  A technical diagnostic file must be attached to the lease. The file includes the following documents:

                  Other documents must also be attached to the lease:

                  Set the amount of rent

                  Generally speaking, a prospective tenant and the landlord can freely decide on the rent amount for a new tenancy. Nevertheless, setting the right rent price means more than trying to make a profit. First, you shouldn’t estimate the rent price of an apartment instantly; you must actively research it by Calculating Your Apartment Rent in France.

                  The rental contract must legally detail the rent and charges (utilities) due every month. Charges are paid in addition to the rent for services like cleaning common areas, waste disposal, and sometimes heating and water.

                  Duration and Renewal of tenancy agreement

                  Typically, a tenant can rent furnished apartments with short-term contracts, up to one year; unfurnished apartments with long-term rental agreements, which are a minimum of three years if renting from an individual landlord or 6 years if the property belongs to a company. When rented to students, contracts may last the academic year (e.g., mobility lease).

                  As the end of the lease approaches, you might wonder, “What now?” If neither party raises a flag to end the tenancy, and if you’ve been the model landlord (and your tenant, the model renter), the lease can sail smoothly into renewal. It’s a tacit nod to another three or six years for unfurnished rentals. Furnished leases? Another year of smooth rent.

                  If your contract allows renewals, you can extend your stay. In France, you can renew your contract by one year for furnished rentals and by three years for unfurnished rentals, with an option to renew again.

                  If the landlord hasn’t given a tenant six months’ notice, the tenant can live in the rental even after the lease has expired. In this case, the rental contract will automatically renew for the duration of the original contract, and there’s no need to prepare a new one.

                  Helpful legal resources during a rental process

                    Section 3: Legal Obligations of Landlords and Tenants

                    Landlord obligations

                    The tenant’s rights are the landlord’s duties, and the tenant’s duties are the landlord’s rights.

                    The lease agreement is the key document to review, as it typically comprehensively lists the landlord’s responsibilities. So, the property must meet the decency requirements set forth by French law, which include:

                        • Tenant well-being and security;

                        • Pests and parasites free;

                        • Minimum area of 9 square meters;

                        • Ceiling height of 2.20 meters (minimum);

                        • Minimum energy efficiency;

                        • The equipment specified in the lease ought to be operational.

                      It is feasible to agree with the landlord regarding who will handle the necessary repairs if the property is not in excellent shape when the lease is signed. Still, landlords should provide a basic level of decency for their tenants.

                      Tenant obligations

                          • Take out tenants’ liability insurance (assurance risques locatifs);

                          • Pay the rent on time;

                          • To pay service charges (“charges locatives”): water, electricity, communal maintenance in an apartment;

                          • Use the property only for the purpose stated in the tenancy agreement;

                          • Maintain the property, its equipment, and fittings to a certain standard (to do specific minor maintenance work);

                          • Carry out the minor repairs you are responsible for, filling in any holes you made, changing light bulbs, clearing blocked pipes, etc.;

                          • Tenants must be responsible for any damage unless the landlord, an uninvited person on the property, or force majeure (circumstances outside of their control) causes it;

                          • Grant the landlord access to the property by prior appointment to carry out works or enable future tenants to visit it;

                          • The tenant must keep all rent receipts from the owner or the owner’s agent since they document rent payments. The owner does not need to give a receipt unless the tenant requests one.

                        Alternatively, the government has provided a detailed list of the tenant’s repair obligations here, and we’ve also assembled a comprehensive guide concerning tenants’ responsibilities.

                        Subletting

                        While you, as the tenant, are free to use your rental home however you see fit, you are not permitted to sublease the property without obtaining a written agreement from your landlord. Check out what subletting is and what legal considerations apply.

                        Section 4: Prohibited Clauses and Tenant Protections

                        Illegal clauses in French tenancy agreements

                        1. French law forbids requiring tenants to pay rent directly from their salary or by standing order.

                        2. It is against the law for a landlord to turn away or refuse to accept pets, whether for an annual tenancy or holiday accommodation.

                        3. Landlords are not permitted to include clauses in the lease agreement that automatically renew the lease without the tenant’s consent each time it renews.

                        4. Requesting more than one month’s rent as a damage deposit for unfurnished properties is considered excessive and prohibited.

                        5. Landlords cannot require tenants to purchase home insurance from an insurer chosen by the landlord.

                        6. Clauses that completely prohibit subletting or hosting activities like Airbnb without landlord approval are not allowed. Such clauses must allow the landlord to agree to subletting or hosting under certain conditions.

                        7. Landlords cannot have unrestricted access to the property. They must have tenant consent or a legitimate reason, like urgent repairs, to enter the property.

                        8. Clauses that make tenants responsible for major repairs or issues not caused by them (like structural flaws) are forbidden.

                        9. Any clause that unreasonably restricts the tenant’s personal rights, such as having visitors or making changes to the living space (e.g., as painting), is prohibited.

                        Section 5: The Role of Statutory Surveys and Condition Reports

                        Mandatory reports and surveys

                        The landlord must give a prospective tenant several documents. For example, a technical diagnosis report includes energy performance, lead exposure risk report, and natural, technological, and mining risks report.

                        These survey reports are collectively known as the Dossier de diagnostic technique immobilizer. They protect both landlords and tenants and ensure your property is safe, energy-efficient, and compliant with French regulations.

                        If the landlord doesn’t give tenants reports or make repairs before renting out an apartment in France, it’s seen as neglecting safety responsibilities and could lead to legal consequences. After all, if a property diagnosis is missing, the tenant can terminate the lease or ask for a rent reduction.

                        Even though diagnostics require extra time and financial expense, they are necessary to ensure the property’s safety and regulatory compliance, foster open communication, and lower risks for all parties involved.

                         

                         

                        France has two property taxes – the taxe d’habitation and the taxe foncière.

                        The tenant who lives at the property pays the taxe d’habitation, while the landlord pays the property ownership tax, the taxe foncière.

                        Tax Benefits

                        Professional landlords enjoy tax advantages, such as:

                        • They can offset losses against their total income, not just from furnished rentals;
                        • Exemption from wealth tax on rental properties;
                        • Concessions on capital gains tax with exemption after running the business for at least five years;
                        • Evaluating the property as a business asset potentially leads to concessions on inheritance tax.

                        Income Tax

                        Landlords have three options for income taxation on profits from furnished accommodations: micro-enterprise, régime reel, and micro-fiscal for those registered as micro-entrepreneurs.

                        Note: Under certain conditions, you may be exempt from taxes on rental income from renting out a room in your home.

                        VAT and Special Tax Regimes

                        VAT applies only when you provide at least three of these services to tenants: breakfast, daily cleaning service, reception service, and linen service.

                        Professional and non-professional renters are subject to the same regulations.
                        Generally, the rate is 10%; however, furnished rentals of residential properties are free from VAT.
                        VAT is only applicable in the following cases:

                        • Furnished rooms with amenities comparable to those provided by hotels;
                        • Leasing of vacant space to hotel establishment operators;
                        • Staying in tourist hotels or categorized apartments.
                        • There is a VAT exemption on furnished rentals when the lessor’s total rent for the prior year did not exceed €82,800 (excluding taxes).

                        Small Business Classification

                        In France, Micro-Entreprise is a simplified tax status designed for small businesses, including individual entrepreneurs and landlords. This system streamlines reporting and paying taxes on earnings from sources such as rental income.

                        Unlike business structures, a Micro Enterprise does not require registration procedures. This simplicity makes it an appealing choice for earning income from rentals without the complexities of establishing a full-fledged business entity.

                        The micro classification provides tax benefits for those exploring furnished lettings, including gites and chambres d’hôtes (i.e., holiday homes and bed and breakfast accommodations). However, demand can vary, so assessing your strategy for the best outcome is critical.

                        As a small landlord, you usually don’t have to register your business. Especially if you’re dealing with properties that are not furnished. However, if you dive into short-term holiday rentals, be prepared to handle some registration tasks.

                        Calculating Tax Liability

                        Taxes are not based on annual revenue (gross income from rentals). Instead, landlords receive a fixed percentage allowance that reduces the taxable base. This deduction accounts for expenses, so landlords don’t need to detail or justify expenses.

                        If you want to stay informed about local regulations and actively engage with the dynamic real estate market, check out our Expert Guide to Landlord Responsibilities in France.

                        Section 6: Ending a Tenancy

                        Legal procedures and conditions for terminating a tenancy agreement

                        France has very tight rules on property rentals. And those rules are also quite complicated, so you need to know what they are and how they apply to you.

                        Tenants are typically entitled to keep their apartment as long as they fulfill their obligations. Yet, repossession and eviction may be necessary in certain circumstances, although these are exceptions to the rule.

                        Furnished property

                        The written agreement has a one-year term if a furnished property is rented out as a principal residence. The renewal extends on an annual basis.

                        If a landlord does not wish to continue a contract, they must provide three months’ notice and a valid reason for not extending the agreement, such as the sale of the property or the tenant’s failure to fulfill their obligations.

                        Unfurnished property

                        The landlord can’t quit the agreement until the lease expires unless the tenant has not paid rent or significantly failed in their obligations. In that instance, the lease is canceled, and the landlord must notify the tenant by registered letter or letter signed by a bailiff.

                        The renewal extends for three years for unfurnished properties or six years if a company owns the property.

                        The landlord must give notice to quit at least six months before the end of the contract.

                        Rights and responsibilities of both parties upon termination

                        Landlords are limited to three reasons for reclaiming their property:

                        1. Reclaiming for Personal Use

                        The property is needed for the landlord’s or a close relative’s use. If a property company owns the home, this option is only available if the family member needing the house is also a shareholder. Landlords must clearly state who will occupy the property when they end a tenancy for personal or family use.

                        2. Intention to Sell Property

                        The landlord decides to sell the property. For unfurnished homes, the tenant has the first right to purchase at the landlord’s set price, a right known as the first refusal.

                        3. Violation of Lease Terms

                        Should the tenant break any lease terms, the landlord has the right not to renew the lease. Eviction for lease violations involves legal action, stressing the importance of thorough documentation and seeking legal advice.

                        Section 7: Resolving Disputes

                        Common disputes between landlords and tenants

                        The top three items on the list of rental disputes are security deposits, rental charges, and disruptive situations.

                        Suppose the complaint concerns something other than the lessor not returning the security deposit. In that case, it usually involves a disagreement over what was agreed upon during the “inventory of the housing” or how much repairs should cost.

                        The number of complaints about disruptive situations is also high on the list. The inadequate thermal resistance of the walls and windows, the heating system’s malfunction, etc., create difficult conflicts to solve.

                        There are a few different ways to handle disagreements.

                        Wherever possible, it makes sense to address issues directly, if only to avoid the emotional and financial costs that can occur when matters spiral out of control and get into the hands of third parties.

                        If the issue cannot be settled amicably, three significant options exist: advisory services, mediation, and legal action.

                        Resources and legal aids available for dispute resolution

                        If you seek legal advice, there are many places you can turn to for help to have an answer to your legal issue or guidance in your legal proceedings:

                        1. Avocats au service des victimes is available through the Parisian Regional Council of Access to Law. It mainly focuses on criminal and immigration affairs.

                        2. Les Points d’accès au Droit de la Ville de Paris – These centers, representing the city hall of Paris, organize permanent sessions throughout the year. They are in Paris’s 13th, 15th, 18th, 19th, and 20th districts. They offer help with issues related to work, home, family, foreign and immigration law, consumer contracts, social protection, violence towards women, discrimination, and proceedings involving a French administration or organism.

                        3. PAD Jeunes – Located at QJ, 4 Place du Louvre, it offers legal advice from an official delegate of the rights defender.

                        4. Les Maisons de Justice et du Droit – Managed directly by the Ministry of Justice, these centers offer free, anonymous, and confidential meetings in Paris’s 10th, 15th, and 17th districts. They have a specific division for victims of criminal offenses.

                        5. The Paris Bar Association – Lawyers of the Paris Bar Association volunteer to offer pro bono legal consultations in the city halls of each district and at the Judiciary Tribunal of Paris. They cover various legal issues, including family law, criminal law, employment law, and immigration law.

                        6. Les Relais d’accès au Droit—These centers organize free, anonymous, and confidential sessions for legal issues. With more than 60 locations in Paris alone, they provide access to lawyers or attorneys to guide individuals needing legal help.

                        Legal Aids

                        7. ADIL (Agence Départementale pour l’Information sur le Logement) offers guidance to landlords and tenants dealing with housing concerns, including disagreements. They possess expertise in housing regulations and can assist you in navigating conflict resolution processes.

                        8. Conciliateur de Justice: This mediator assists in resolving disputes before they escalate to court proceedings. The service is free of charge and can be accessed through local court (tribunal d’instance).

                        9. Legal Aid (Aide Juridictionnelle): You might be eligible for aid based on specific income requirements. This support can cover some or all expenses of hiring a lawyer if the disagreement goes to court.

                        10. Huissiers de Justice (Bailiffs): Bailiffs may be involved in matters concerning the enforcement of judgments, such as evictions or rent collection. They act upon court directives to ensure compliance.

                        Additional Resources

                        List of resources for further reading and professional services for crafting tenancy agreements

                        Websites for Legal Information and Templates

                        Service-Public.fr – This official French administration website provides information and guidance on all legal aspects of living in France, including housing and rental agreements.

                        ANIL.org – The National Agency for Information on Housing (ANIL) offers in-depth resources on housing laws and tenancy agreements.

                        Professional Services

                        Notaires de France – Notaries in France can provide legal consultations and help draft secure and comprehensive rental agreements.

                        Real Estate Lawyers – Specializing in property law, these lawyers can offer personalized advice and contract drafting services.

                        Books and Publications

                        “Le Guide du Bailleur”. A handbook designed to assist landlords with responsibilities and practical property management tips in France.

                        Droit au logement droit du logement”. A book exploring housing rights and regulations in France with a focus on agreements.

                        Online Platforms and Tools

                        DossierFacile.fr is a government platform aiding landlords and tenants in preparing documentation for rental contracts.

                        Legalstart.fr is an online service offering customizable legal documents, including tailored rental agreements that are compliant with French law.

                        Associations and Support Organizations

                        Fédération des Associations pour la Promotion et l’Insertion par le Logement (FAPIL) provides guidance and support to tenants and landlords on housing issues.

                        Mediation Services

                        Becoming a Wunderflats Landlord is straightforward and fast. List and rent out your property with ease.

                        Please note: This article does not constitute legal advice – the information on this page has been prepared solely for your information. As we are not a law firm and act as a platform, we can and may share our estimations, but we cannot give you legal advice for your individual further proceedings.

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