Essential rental info
Posted at December 1, 2020

Main differences between main residence lease and second home furnished lease in Paris

Differences Main Residence and

Secondary Residence in Furnished rentals

 

Definition of Main Residence

The primary residence is, by definition, the actual home of the taxpayer. A home is "primary" when the taxpayer -and family- live there, and their center of the material and professional interests are there. This type of rental is subject to the law of July 6, 1989, Article 2, which defines the primary residence as accommodation occupied for at least eight months per year, except for professional obligation, health reason, or force majeure by the Tenant or spouse. It is impossible to have two primary residences.

1. Type of contract:

Furnished main home contract

2. Establishment of the lease / Legal regime:

Lease defined by decree and subject to the law n° 89-462 of 06.07.1989 (Alur law). This contract is less flexible than the second home lease.

3. Duration of the lease:

Minimum 1 year or nine months for a student. When the Lessor or the Tenant gives no leave, the lease is tacitly renewed for one year at the same conditions, at the end of the lease.

4. Rent setting:

In certain areas, called "tight areas," there is an imbalance between housing supply and demand, which leads to difficulties in accessing housing. Since 2018, rents have been regulated in Paris (Alur law). A decree sets each year the maximum amount of rent evolution. In the main residence contract, there is a distinction between rent and charges. Therefore, the Lessor must ask for the statement of the expense accounts from the Property Manager to get the costs recoverable from the Tenant. The rent excluding charges must not exceed the increased reference rent. (see Paris rent framework)

5. Security Deposit:

Two months rent excluding charges

6. Landlord's Fees:

One month's rent, including charges (Intervention fees, negotiation, and file), and VAT.

7. Tenant's fees:

€ 12 vat included / m2 TTC (Toutes Taxes Comprises) = VAT 20%

8. Leave:

Leave issued by the Tenant: The Tenant can give notice at any time, with a period of one month.

Leave issued by the Lessor: The Lessor can give leave to his Tenant at the end of the lease in three cases:

  • To take back the accommodation to occupy it or to accommodate a family member
  • To sell the property (in furnished rentals, the Tenant does not have priority to acquire the property for sale)
  • For a severe and legitimate reason (ex: non-compliance by the Tenant of his obligations to pay the rent, lack of maintenance, nuisances).

The Landlord must give notice to the Tenant at least three months before the end of the lease.

 

Definition of secondary residence

In the fiscal sense of the term, "secondary residence" designates any accommodation that is not one's primary home. One can only have one primary home. It is called the French Civil Code leasehold.

1. Type of contract:

The "secondary" residence's lease contract does not depend on the law of 07.06.1989

2. Establishment of the lease / Legal regime:

A secondary residence lease is a housing contract that determines the rental of a secondary property. It is less strict than the principal residence lease. The owner and the Tenant freely define the terms of the contract: rent, rental period, notice period, etc. With this lease, the Civil Code prevails (articles 1708 and following).

3. Duration of the lease:

The parties decide freely on the lease duration and a tacit renewal clause or not.

4. Fixing of the rent:

The rent is fixed freely between the parties. Often, the total rent amount includes the Lessor's rental charges, but nothing prevents the latter from requesting a fixed price or a provision.

5. Security Deposit:

Two months rent including charges

6. Landlord's Fees:

100 € TTC

7. Tenant's fees:

Rental period from 1 year to 3 years:

  • Company lease: 10% of the annual rent + 20% VAT = 1.44 rent including VAT
  • Lease Individual: 10% of the annual rent, VAT included = 1.2 months including VAT

Rental period under one year:

  • Company lease: one month's rent + 20% VAT = 10.2 months including VAT
  • Lease Individual: one month's rent, VAT 20% included = 1 rent including tax

8. Notice of leaving:

Leave issued by the Tenant:
At any time by notifying the Lessor 1 month ahead of the leaving date.

Leave issued by the Lessor:
Three months before the end of the contract or before the last renewal.
.

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Credits photo@louispaulin

 

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