top of page

Maximise your rental income!

Everything You Need to Know About the Reference Rent in Paris

Do you want to rent your property in Paris? Please note that the legislation remains very strict on the subject. In fact, rents have been regulated since July 1, 2019. Different elements must be considered such as the type of accommodation, its location and the number of square meters. We advise you to scrupulously respect the law, otherwise you may be exposed to particularly heavy penalties.


Woman on computer
The legislation for renting in Paris is strict

Some additional information regarding rent control in Paris

Rent control is not an option, but an obligation to respect. A measure that has been taken and applied since July 1, 2019. It applies to the entire French capital, for experimental purposes over a period of eight years. Therefore, the maximum amount of rent not to be exceeded takes into consideration the number of square meters. From now on, you will find a division into 80 distinct districts allowing you to define the amount of rent according to the type of accommodation, that is to say furnished or empty. But other parameters come into play such as the date of construction of the building and the number of rooms.



However, the supervision of rents is not new, because its first appearance was made between 2015 and 2017. A court decision canceled it, because the management did not respect the impositions of the Alur law . Paris was the first French city to reintroduce this measure and today other cities in the Paris suburbs have done the same. Therefore, to set a rent or increase the rent, you must take into consideration the legislation in force.


Banner

Taking into account reference rents in Paris

Please note that the measure concerns any real estate rented as a main residence for the tenant, but also furnished rentals. Without forgetting the accommodation covered by the mobility lease and the furnished student lease.


As soon as a contract has been signed before July 1, 2019, you will find double supervision. As a result, the price of renting an apartment must not exceed the rent of the previous tenant, while taking into account the increased reference rent established by the Paris prefecture. Moreover, the latter is revised every year during the month of June.


The situation is different when the rented accommodation takes place before the arrival of the new tenant. If the previous rent did not exceed the increased reference rent, the amount for the new tenant is based on the limit of the previous amount. On the other hand, when the previous rent exceeds the increased reference rent, the owner will have no other choice but to lower it to match the new regulations. The only exception concerns the application of a rent supplement when the property offers additional services.


How to find out the reference rent in Paris?

The Île-de-France prefecture has set up an interactive map that you can freely consult by going to http://www.referenceloyer.drihl.ile-de-france.developpement-durable.gouv.fr/ . Obviously, you take into account the intrinsic characteristics of your home and its location depending on the neighborhood. Once these criteria are specified, you discover the reference rent per habitable square meter. Several information is offered to you such as the reduced, increased reference rent and the basic reference rent. Above all, stay within the limits set by legislation, without taking into account monthly charges.


If you decide to ignore this legislative measure, you simply risk a fine. The latter can reach an amount of €5,000 when you rent as an individual. For a legal entity, the price can rise to €15,000.


Sorbonne
There are several sources of reference rent in Paris

Understand how rents work in Paris

As explained previously, the ceiling rent is updated each year. It is established according to the address of your property, while taking into account the rental status, i.e. unfurnished or furnished, its surface area and the year of construction of the building. . Paris is divided into 80 distinct zones and each time, you find 3 reference rents. First, the basic amount, then the rent reduced with a discount of 30% and finally the reference rent increased with a bonus of 20%.


Each time, the value takes into account the price per square meter of living space according to the geographic sector and the category of housing. In the context of a furnished rental property, an increase coefficient applies. As an owner, you would like to clear the better profitability, but it will be impossible for you to go beyond the ceilings defined by legislation. You even have an interest in following consistent pricing in order to retain your tenant.


To apply the increased reference rent, the rental property must have exceptional characteristics in comparison with other accommodation located in the same geographical area. This may be a very specific location or increased comfort. However, do not forget to provide all the necessary details regarding the additional rent in the lease.


Vigilance between local rent caps and national rent controls

Previously, we mentioned the local rent capping system. This should especially not be confused with another legislative measure known as national rent control. However, there are certain geographical areas where the two rules coexist. This is obviously the case in the Paris region and you should know that one measure does not prevail over the other.


The rule remains very simple in this matter, that is to say that you must systematically apply the lowest rent amount. Before embarking on property rental in the Paris region, do not forget to take this specificity into consideration as well as the other existing rules. Rather than easily making an administrative error, don't forget to consider working with a trustworthy partner, capable of supporting you calmly throughout your real estate project.


Banner

Comments


Determine your property's rental value with UpperKey as your tenant

bottom of page