A1 REAL ESTATE

Can a commercial space be transformed into a dwelling?

Return
Share the article
|
Can a commercial space be transformed into a dwelling?


Home improvement shows would tell you that you can transform any real estate into any kind of property. And it's true when it comes to transforming a commercial space into a personal residence. What's necessary here is to change its type of rental investment, which can often be expensive in large cities like Paris. 

Before starting any real estate project, it pays to know the 5 main types of real estate investments. They include:
  1. Residential 
  2. Commercial
  3. Agricultural
  4. Industrial
  5. Special Purposes

Following this change, you'd do well to consult the Local Urban Plan (PLU) in Paris or your local town hall to ensure that they do not oppose the change. 
The PLU is a regulatory document intended to organize a city's development and evolution over several years. It contains all the requirements concerning the prohibitions or limitations of certain real estate investments within a given geographical area.
When converting a commercial space into a residence is accompanied by work, it is necessary to: 
  • Apply for a building permit if the change is accompanied by work to modify the load-bearing structures or the façade of the building (i.e. adding windows or doors)
  • Make a prior declaration (for other cases)

Moreover, if the room measures more than 150 m² of floor area, it is mandatory to use an architect for work affecting the load-bearing structure or the façade of the building.

Does converting commercial premises into a dwelling have tax consequences?


The transformation of any property into a personal residence modifies the calculation of the property tax. The territorial economic contribution is abolished and is replaced by the payment of the housing tax.

Upon completion of the transformation, the owner must declare the change of use within 90 days. The form can be sent as a recommendation with a receipt or deposited at the cadastre office.

This declaration makes it possible to update the cadastral rental value of the property from which the property tax is calculated.

Does the dwelling have to meet habitability standards? 

Whether the property is transformed into one's main residence or a rental (empty or furnished), the dwelling must meet a certain set of standards. They include: 
  • Must be equipped with a drainage system
  • Must be connected to an electricity grid
  • Must include proper electrical, heating, and gas installations
  • Must have natural lighting with a window
  • Must have an air renewal system

If the property is converted into a rental, it must meet obligations related to the notion of “decent housing.” As such, it must include:
  • Proper Security
  • The Comfort of the tenant (i.e. absence of parasites, distribution of cold and hot drinking water, presence of a kitchen area, bathroom with a separate toilet, etc.)

Useful Links:

Can a home be converted into commercial premises?

Since you can convert a commercial space into a personal residence, it's also possible to convert a personal residence into a commercial space. The process is fairly similar to that of the former, commonly entailing requesting permission from the town hall, changing the tax regulations, and more. 

It’s also important to remember:
  • There is no need for a change of use authorization if you live on the property and you do not receive customers or goods there.
  • The change of use permit is mandatory for properties located in a municipality of more than 200,000 inhabitants
  • The change of use of a built property must be declared to the tax authorities within 90 calendar days.
  • The co-ownership regulations clearly define the property's type of real estate investment (i.e. residential, commercial, agricultural, etc.). As such, it is necessary for all co-owners to reach a unanimous decision for the transformation to happen. 

What are the steps to be taken with the cadastre?

The transformation of a premises into a dwelling modifies the calculation of the property tax, and the territorial economic contribution is abolished.
It is necessary to declare the change of assignment via a form. The form can be sent as a recommendation with receipt or deposited at the cadastre office within 90 days of making the change of destination.
This declaration makes it possible to update the cadastral rental value of the premises from which the property tax is calculated.

What are the steps to be taken if the premises are in co-ownership?

The co-ownership regulations clearly define a property’s type of real estate investment (i.e. residential, commercial, agricultural, etc.). Thus, it is necessary to:
  • Verify that the building's co-ownership regulations 
  • Obtain the unanimous agreement (commonly through voting) of the co-owners to carry out the potential transformation work
To Authorize the transformation of the commercial space into a personal residence.
Ce qu’il faut retenir :
  • It is possible to convert a commercial space into a personal residence.
  • It is also possible to convert a personal residence into a commercial space.
  • There are 5 main types of real estate investments: Residential, Commercial, Agricultural, Industrial, and Special Purposes.
  • Converting a property's type of real estate investment also includes changes in its tax regulations. 
  • If the property is under a co-ownership, a unanimous decision is needed before you can legally transform any property. 

You want to
to sell in Paris or its surroundings ?

Contactez-nous

WANT TO FOLLOW US
on social networks?

RESPECTING YOUR PRIVACY IS A PRIORITY FOR US
We use cookies to provide you with an optimal experience and relevant communication on our site. Thanks to these technologies, we can offer you content related to your interests. They also allow us to improve the quality of our services and the user-friendliness of our website. We will only use personal data for which you have given your consent. You can modify it at any time via the ″Manage cookies″ section at the bottom of our site, with the exception of cookies essential to its operation. For more information about your personal data, please see .
Accept everything
Refuse all
Personalize