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"Dry goods" rental investment strategy second series - how to bypass Paris rent restrictions

In the last issue, we explained how to "deploy" the initial rental plan "dry goods" Paris housing rental investment strategy 1 - with or without furniture ? In this issue, we will continue to bring you the second series of "The Complete Guide to Rental Investment - How to Bypass the Paris Rent Restriction". There are also questions that everyone is interested in: if you invest in buying a house and renting it out, is it possible to get a residence in France for investment?

Series 2: How to get around Paris rent restrictions (Loi Alur)?

The Paris rent limit was first implemented in 2015-2017, mainly to control the crazy rent increase in 2005-2015: a 50% increase in ten years, which made many Parisians unable to afford it. The law was restarted on July 1, 2019 after being suspended for two years in 2017-2019. This is really bad for landlords, so today we will tell you about the ways to bypass the rent limit and ensure maximum income. .

Let’s first look at the two laws that French lease treaties use to comply/choose: Loi Alur/Elan (Paris rent restrictions) and Code Civil (French civil law).

01. Bail Alur (Loi Alur)

Loi Alur (Rent Limit) was introduced in 2014 by former French housing minister Cécile Duflot (Ministre de l'Égalité des territoires et du Logement) and implemented in 2015-2017. In September 2019, Paris re-implemented the (rent price limit order), and the rent stipulated the online rent according to the area where the listing is located and the situation of the house. For details, check the website http://www.referenceloyer.drihl.ile-de-france.developement


According to the regulation, rents must comply with the reference price per square meter set by the government. The actual rent cannot be higher than 20% or lower than 30% of the reference rent. If the rent exceeds the limit, the tenant has the right to complain to the landlord, the rent will also be forced to reduce, and the landlord will also face a fine.


In France, all rental properties that are résidence principale must have a Bail Alur lease.

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That said, if your tenant uses the rental property as their primary residence, you cannot get around Paris rent restrictions.


02 Code Civil

Code Civil is a French civil law, and all aspects of the tenancy agreement using this regulation are freely negotiated between the landlord and the tenant: such as rent, agency fees, and even the termination notice time, they are all freely set. So which leases can use this statute?

  1. The tenant uses it as a résidence secondaire, such as many out-of-province or international tenants;

  2. The tenant signing party is a company, such as residential contracts signed by many companies for their expatriates

  3. The tenant is an association and the property is used for its association activities.

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Paris is the city with the most European headquarters of the world's top 500 companies. These large companies have the need to rent for their expatriate employees. Therefore, if you want to bypass the Paris rent restriction, it is best to seek tenants like companies. However, the houses that companies need are very demanding in terms of location, house quality and house layout, so this is one of the important reasons why we have always emphasized investing in high-end real estate.


Finally, there is the question of whether France can obtain residence by investing in real estate. Then your leasing strategy is not to pursue the return on investment, but to rent out your house at a lower rent than the market as a social housing. : Because although there is no clear relevant decree in France, if the real estate you invest in is in a tight area of the rental market and rents out at low rents, making a "contribution" to the local social economy in France, then you can apply.

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