Renting out French property

[Gilles le fermier]

I wonder if some of you Living Francers out there could give us some advice about this. 

Basically, we have seen a 3-bed house in an area we know well and are considering it purely as an investment, although it might eventually be a retirement home (a very long way down the line!).  We would be anticipating renting it out to long-term French tenants, but obviously need to be aware of the legal implications.  We understand that the rules are very different in France and that tenants have much more rights, and I gather that leases are longer than in the UK.

Also, are there such things as property management agencies in France, and if so what are their fees?

I presume that we would need to declare the income to the French tax authorities and then declare in the UK but have the tax already paid taken into consideration.

Any help would be gratefully received.

[Nick Trollope]

Yes, things are very different here. Leases (bail) are long - 3 years, although there are few circumstances under which you can get a tenant out. Our Notaire handles all the legal side for us and charges the tenant (not much, as it happens).

Management agencies (usually attached to estate agents) do exist and can provide a complete service, although I have never used one.

As regards income, it depends on where you are tax resident. If in the UK, then declare to the UK, if in France, then to the French tax authorities. But ask an accountant.

[Jo Taylor]

It's an area subject to an enormous number of complicated rules and regs - as Nick says, get proper advice from a notaire or agent immobilier (in France they are qualified to advise on and deal with the legal side of long-term letting). See the SNPI, ANPI and FNAIM sites.

Gilles, you're broadly correct on the tax issue - sorry, Nick, I must correct your statement : ALL income from property letting must be declared in France, irrespective of residency and double taxation treaties. Heavy fines can ensue if no declaration is made.

HTH
Jo

[Nick Trollope]

[quote user="Jo Taylor"]

Nick, I must correct your statement : ALL income from property letting must be declared in France, irrespective of residency and double taxation treaties. Heavy fines can ensue if no declaration is made.

HTH

Jo

[/quote]

Well, I didn't know that - not really an issue for me, as I don't live in the UK.

[cheminot]

Apologies if this is 'hijacking' this thread but when I retire ( in a few years) we are going to live permanantly in France and like Gilles are considering buying another property to rent out to supplement our pension income. We dont want to use the second property as a holiday let because of the work involved, but would like to let it on a long term basis in the same way that Gilles is thinking of.

Our neighbours in France have said that we should avoid it at all costs because of the difficulties in obtaining rent or eviction if a tenant defaults.

We realise this can happen but can anyone tell us if this as big a problem as our neighbours seem to think?

Cheminot

[Evianers]

Our property was actually let to a couple from Portsmouth - long-term. Not to put too fine a point on it, they absolutely - I think the common phrase is - trashed the place! The mess was indescribable. They absconded without paying the last two months rent and with the keys! However, we have excellent people working on our behalf as management agents who tracked them down. Fortunately we had taken the above's advice and had the Huissier take photographic evidence. Cutting a long and painful story short, a court case ensued, the female judge found in our favour and they had to pay heavily in damages. Ergo, just a word of caution - there are good tenants and bad. They have the right to stay for 3 years under French law. Subsequently we have had French people renting and touch wood they have been clean, tidy and paid the rent on time; however, we have learned the hard way and taken out a 3% insurance to cover damages and non-payment of rent, which gives some peace of mind.

PS if anyone wants their name, em us privately!!!!!