LEASE IN PRINCIPAL RESIDENCE
Summary
- What is a principal residence?
- What is the principal residence lease?
- Under what legislation governs the lease in principal residence?
- Empty or furnished rental: What is the duration of the lease?
- Giving leave in principal residence
- Rent control
- What security deposit in main residence?
- Where to declare your main residence?
- What are the differences between primary and secondary residence?
- Useful links
1. What is a principal residence?
The Law of July 6, 1989, defines the principal residence as a “property occupied for at least eight months in a year by either the tenant, and/or their spouse, or by a dependent as set by Article 2 of the Construction and Housing Code.” This definition excludes residence throughout about by professional obligation, health reasons, and other unforeseeable circumstances (force majeure).
2. What is the principal residence lease?
The principal residence lease applies to either:
- Exclusive residential use
- Mixed-use (both residential and professional use)
In terms of professional use, however, the residential property should not be used as a commercial space. The principal residence lease does not apply to those kinds of professional use.
3. Under what legislation governs the lease as a principal residence?
- The Construction and Housing Code,
- The General Provisions of Articles 1713 et seq. of the Civil Code,
- Law n°89-462 of July 6, 1989,
- Law No. 2014-366 of March 24, 2014, also known as the ALUR Law.
- The Decree of May 29, 2015, states that all mandatory information regarding the property must appear in principal leases signed after August 1, 2015.
Other French laws worth noting include:
- The Law of October 7, 2016, leaves the possibility for municipalities to determine the registration procedure for any rental to transient customers.
- A Law set on October 1, 2017, by the City of Paris requires property owners to obtain a registration number before being able to temporarily rent out their main residence (this number must appear on all housing ads).
4. Empty or furnished rental : What is the duration of the principal residence lease?
For a standard furnished rental, the minimum duration is a year (twelve months). But for students under the same kind of lease, the minimum duration is 9 months.
If the tenant has not given notice of their departure from the property at the end of their term, the lease will be renewed automatically and under the same conditions for another year (9 months for students).
For an unfurnished rental, the minimum duration depends on the legal status of the prospective tenant.
- French citizens have a minimum duration of 3 years
- Legal expatriates have a minimum duration of 6 months
Important Note:
An SCI composed exclusively of members of the same family (up to the 4th degree) benefits from the regime of natural persons (French citizens).
5. Giving leave in principal residence
- Take back the property and let a relative live there.
- Sell the property (Important Note: in the case of furnished rentals, the tenant does not have priority to purchase the property)
If the owner plans not to renew the lease, they should give the tenant a proper notice at least three months prior to the end of the term.
On the tenant's end, they are free to leave the property at any time provided that they give proper notice to the owner/landlord at least one month prior to their departure.
Helpful Link:
6. Rent control in principal residence
Since 2019, rents have been regulated in Paris (Alur law). To comply with the rent control, the rent charged (excluding charges) must be between the reference rent plus 20% and the reference rent minus 30%.
This concerns first leases, changes of tenants and lease renewals. Rent control only applies to principal residences.
This does not apply to second homes, low-rent housing or seasonal rentals.
In the principal residence contract, the rent and charges are separated. It is essential to ask the landlord to provide the statement of the expense accounts.
Note : The rent (excluding charges) must not exceed the increased reference rent.
7. What security deposit in principal residence?
The amount of the security deposit must be included in the principal residence lease and it cannot be greater than:
- 1 month's rent for the rental of an unfurnished property (excluding rental charges)
- 2 months' rent for the rental of furnished property (excluding rental charges)
Important notes:
- If the landlord does not return the security deposit within the prescribed time, they must pay late payment interest to the tenant.
- The amount of the security deposit to be returned to the tenant is increased by an amount equal to 10% of the monthly rent (excluding charges) for each month of delay.
- The security deposit does not replace the last rent.
- It is illegal to deduct from the last rent to add to the amount of the security deposit.
- A tenant who deducts the amount of the security deposit from the last rent cannot obtain a rent receipt.
Helpful Links:
- When and how to pay the deposit?
- How long does it take to return a deposit?
- What is the difference between the security deposit and the deposit?
- Guarantor and surety
8.Where to declare your main residence?
To do so, you must:
- connect to your personal or professional space on the impots.gouv website with your tax number and password
- go to the "Real estate" tab to make for each property a declaration of occupation (principal residence, secondary residence, rented premises, premises occupied free of charge, vacant premises) and monthly rent (optional).
9. What are the differences between primary and secondary residence ?
The second home is then an occasional habitat in which the owner spends a few months a year (usually holidays, leisure, holidays).
Furnished tourist accommodation, otherwise known as seasonal rentals, are also classified as second homes.
Although it is more flexible than the principal residence lease, it is still a little stricter than the mobility lease. On the one hand, the minimum duration of this lease is three months. You can extend the duration beyond this period if you need to.
But if you need to break the lease, you must send one month's notice after the end of the first three months.
A dwelling can go from a second home to a primary residence. For this, it will be necessary to live there at least 6 months of the year and prove it for the housing to be considered as a main residence.