EMPTY OR FURNISHED RENTAL?
Using empty leasing guarantees stability (leases have a duration of 3, 6 or 9 years) and little management. In addition to its long duration, housing management is less.
Renting your furnished apartment means offering your furnished apartment to a foreign and professional quality clientele , it is also:
- Recover the apartment more easily
- Less risk
- Better profitability
- Higher rent due to additional benefits
- More advantageous taxation
- Use an agency for the management of the property
Choosing us for the furnished rental of your apartment in Paris is choosing an experienced professional real estate agency mastering the aspects of temporary or long-term rental of furnished apartments in Paris.
Summary
- What is a furnished rental?
- What is empty rental?
- What are the differences between an empty rental and a furnished rental?
- What is the list of mandatory equipment for a furnished rental?
- Rental investment: what elements to determine profitability?
- How is the rental yield calculated?
- Conclusion: empty rental or furnished rental?
- What is a furnished rental?
As a reminder, according to Decree No. 2015-981 of 31/07/2015, we call furnished rental, the provision of a furnished home that includes all the furniture elements essential for normal occupation
When you rent a luxury apartment in Paris for furnished rental, you need to know what type of lease you are signing. Yes, there are several.
There are actually five main ones: the principal residence lease, the mobility lease, the secondary residence lease, the civil code lease and the seasonal rental (otherwise we also have the solidary real lease, the commercial lease and the emphyteutic lease ).
The French capital knows that many of its residents, whether citizens or expatriates, have all kinds of different situations in terms of residence. It is important that you get the right type of lease for your specific situation. Get to know them.
2. What is an empty rental?
Empty rental is the rental of a dwelling without furniture. The minimum duration of the lease is 3 years, it is also possible to extend the rental contract for a period of 6 years, and 9 years.
In general, the amount of rent is set freely and charges may be requested for the maintenance of the premises.
As a landlord, the law allows you to ask the tenant for a security deposit that is equal to one month's rent.
At the signing of the contract, the owner is obliged to give the technical diagnoses to the tenant.
Unlike furnished rentals which require time to perform the current tasks of rental management of the property, bare rental sees the tasks be reduced (for example: tenants follow one another less often, the inventory of fixtures of entry and exit are less)
- Lease duration : 3 years minimum (renewable by tacit agreement)
- Security deposit : 1 month's rent (excluding charges)
- Notice (owner): 6 months before the end of the lease
- Notice (tenant ): 3 months (1 month under conditions, especially in tense areas)
- Status: falls under the land revenue regime
- Tax system // Non-resident tax system:
> Real Land Regime : beyond €15,000 rent or optional, all charges are deductible from property income
- Social security contributions (excluding non-residents, cross-border workers and expatriates): 17.2% of taxable income (CSG – CRDS)
- Lease duration : 1 year minimum, or 9 months in student rental (in the case of accommodation rented as a main residence)
- Security deposit : 1 year minimum, or 9 months in student rental (in the case of accommodation rented as a main residence)
- Notice (owner): 3 months before the end of the lease
- Notice (tenant): 1 month
- Tax system // Non-resident tax system:
> Simplified Real Regime : beyond € 77,700 or optional, all expenses are deductible + depreciation of the value of the property
- Social security contributions (excluding non-residents, cross-border workers and expatriates): 17.2% of taxable income (CSG – CRDS)
- Notary or incorporation fees
- Local taxes
- Maintenance and repair costs
- Loan interest
- Management fees and insurance
- The depreciation of furniture over a period of 5 to 10 years, for a rate of between 10 and 20% per year.
A furnished accommodation must include at least:
- Bedding (bed or sofa bed) with duvet or blanket
- Device concealing windows in rooms (shutters or thick curtains)
- Hobs (built-in or separate)
- Oven or microwave oven
- Refrigerator
- Freezer or freezer compartment of the refrigerator with a maximum temperature of -6°
- Sufficient number of dishes for occupants to take meals (plates, cutlery, glasses, etc.)
- Kitchen utensils (pots, pans, etc.)
- Table
- Seats
- Storage shelves
- Light fixtures
- Housekeeping equipment adapted to the characteristics of the accommodation (vacuum cleaner if there is carpet, broom and mop for tiles ...)
Knowing the profitability of your home is knowing and calculating the interest of a rental investment. It is knowing the rental yield, that is to say what our property, our investment will bring.
In fact, the rental yield is simply a performance indicator that is calculated from the income generated by a rental compared to the purchase price.
Be careful, however, the rental yield is different from the rental profitability.
Even if the two terms are similar, the rental yield is expressed as a percentage and only captures performance . While rental profitability encompasses the return that is appreciated throughout the investment, and also includes a potential resale (and capital gain).
6. How is the rental yield calculated?
- How is the gross yield calculated?
It does not take into account taxation or rental charges and it is not the real income that housing will generate.
- How is the net return calculated?
Logically, the net return is lower than the gross return.
In order to obtain an even more precise idea of the return on his real estate investment, the lessor must calculate the "net-net" return, i.e. net of tax.
It is thus necessary to take into account social security contributions and taxation on rental income (excluding charges). It all depends on the tax regime chosen (real, micro-BIC, etc.), but also on the possible advantages granted by devices such as Pinel , Censi-Bouvard law, etc.
7. Conclusion: Empty or furnished rental?
Renting your furnished apartment means making your furnished apartment available to a foreign and professional quality clientele and this has several advantages:
- This makes it easier to recover the apartment (between two rentals, it is possible to switch from an empty rental to a furnished rental, the furnished rental contract is more flexible)
- Less risk
- Better profitability
- The fixed rent may be higher due to additional services (furniture of value)
- Taxation is more advantageous (tax allowance, deductible expenses, etc.)
- It is possible to go through an agency to manage your property
Choosing us for the furnished rental of your apartment in Paris is choosing an experienced professional real estate agency mastering the aspects of temporary or long-term rental of furnished apartments in Paris.