What Are France’s Zones Tendues?: Rental Caps and Extra Taxes on Second Homes

 

Essential Reading

What Are France’s Zones Tendues?: Rental Caps and Extra Taxes on Second Homes

If you purchase a property or own a second home in one of France’s ‘zones tendues’, you might be subject to extra taxes. Here’s what you need to know.

What is a ‘Zone Tendu’ in France?

With an ever-rising demand for property and a tightening housing market in certain areas of the country, France has delegated certain cities and communes ‘Zones Tendues’ (‘tense zones’). These are areas in which there is a known property shortage, and local measures can be implemented in order to address this.

Most notably, these measures include:

  • Rental control schemes and caps imposed on property rentals.
  • Additional taxes on vacant properties such as second homes.

Is my French property in a ‘Zone Tendu’?

If you own a property or plan to purchase a property in cities such as Paris, Lyon, Bordeaux, and Marseille, or popular areas such as Provence and the Côte d’Azur, you may find your property falls within a Zone Tendu. There are Zones Tendues all around the country, though, so don’t assume that your property doesn’t fall within a zone either!

You can see the full list of Zones Tendu here, organized by department code.

Are There Extra Taxes to Pay in a Zone Tendu?

All second homes in France are subject to two property taxes in France – the Taxe d’habitation and the Taxe Fonciere. While the first of these two taxes is being phased out (by 2023, no homeowner or renter will pay the Taxe d’habitation on their primary residence), it will remain payable by all second-home owners (unless your property is rented out permanently). This applies whether or not your property is in a Zone Tendu.

However, if your property is also in a Zone Tendu, the commune will also be able to add additional charges to this tax. This can be up to 60% of the original tax, so it is not to be baulked at! The idea is to discourage second-home owners from keeping a property empty in these zones and encourage such homeowners to either sell the property or rent it out.

What is the Taxe sur Logements Vacants?

In addition to the Taxe de Habitation, some communes also add an additional tax on vacant properties. This taxe sur les logements vacants (TLV) is fixed at 12.5 % of the value of the property during the first year that the property is vacant, rising to 25% if the property remains unoccupied during the following years. The tax doesn’t apply to properties that are occupied for more than 90 consecutive days a year, are undertaking major building or renovation works, or are on the rental market.

Who has to pay the taxes?

These taxes apply to furnished properties in a Zone Tendu that are vacant or not being used as a primary residence. The taxes aren’t payable if your house is rented out full-time. You may also request an exemption for certain circumstances, such as a second home owned in an area where you work on location (find out more about that here).

If you own a property or are planning to purchase one in a Zone Tendu, its highly advised to seek local advice on the applicable taxes. A good place to start is this online simulator – enter the relevant postcode and you can see a list of the taxes that apply in that region.

Are There Rental Caps in a Zone Tendu?

Other restrictions for properties in Zones Tendues apply to rental properties, most notably rental caps. Introduced to prevent landlords from imposing unreasonable rent hikes on tenants in areas with property shortages, these caps currently apply to properties in cities including Ajaccio, Bordeaux, Grenoble, La Rochelle, Lille, Lyon, Marseille, Montpellier, Nice, Paris, Strasbourg and Toulouse. The caps are different depending on the location, the local market value of the property, and the extent of the region’s housing shortage.

Own a Property or Second Home in France?

Our Essential Reading articles cover everything you need to know as a French homeowner from property taxes and home insurance to paying your bills. Perhaps you also need recommendations on removals to France, advice on building and renovations, or tips for managing a second home? FrenchEntrée is here to help! We can even advise on selling your French property.

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