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Changes for landlords: furnished tourist accommodation

Renting property may prove less profitable in the future. Copyright Roman KraftThe French Digital Republic act, which came into force on 7th October 2016, will bring some changes for landlords who let furnished accommodation. From now on, owners of furnished properties who rent them for short periods, even if they rent their main property, have to register with the local mairie and/or ask for a prior authorisation to change the use of their real estate. This authorisation is already necessary for accommodation in Paris, its suburbs and towns with over 200,000 inhabitants, but now smaller towns too have decided to apply this process.

If the landlord uses the services of a real estate agent or an online platform to rent the property, it must not be rented for more than 120 days per year in the case of main residence and the registration number must be indicated. 

Concerning this new online cooperative economy (rental of movable or immovable property), actual criteria to determine if the rental activity can be considered professional or not, are not adapted. In the new Social Security Act for 2017, thresholds have been proposed:

- 23,000€ for the rental of real estate,

- 7,720€ for the rental of movable property.

Beyond these limits, the activity will be considered as professional and will have to be affiliated to the French pension fund and social security; the owners will therefore have to pay social contributions. This new law should be enforced before the end of this year. 

Rental activity will be more controlled in the future and, sometimes, may prove less profitable because of these new contributions. 

 

Jean-Philippe GIOANNI

Chartered Accountant