In Summary
| Section 🌟 | Details |
|---|---|
| Definition of a furnished rental 🏡 | A housing unit equipped for immediate living, generally intended for long stays (main or secondary residence). |
| Minimum required furniture 🛋️ | Complete bedding, shutters or curtains, cooking plates, refrigerator, kitchen utensils, table and chairs, cleaning equipment. |
| Regulations 📜 | One-year lease agreement (or 9 months for students), 3 months’ notice for the landlord, one-month notice for the tenant, legal obligations such as the DPE. |
| Advantages for the tenant 👍 | Immediate move-in, no furniture purchase costs, flexible lease with reduced notice period. |
| Advantages for the landlord 💰 | Higher rent, tax advantages (depreciation, choice between micro-BIC or actual regime). |
| Disadvantages for the tenant ⚠️ | Higher rent, furniture imposed by the landlord, limited personalization. |
| Disadvantages for the landlord ⚠️ | High initial investment cost, more complex management, higher tenant turnover rate. |
| Definition of a tourist furnished rental 🌍 | Furnished accommodation for short stays (max. 90 days for a single tenant), reserved for tourists, not a primary residence. |
| Regulations 🏛️ | Mandatory declaration at the town hall, possible change of use authorization, voluntary classification with stars. |
| Advantages 🌟 | Rental flexibility, 71% tax deduction if classified, better visibility on rental platforms. |
| Disadvantages ⚠️ | Lengthy and costly classification process, intensive management, potential restrictions in certain cities. |
| Comparison of main features 📊 | Rental duration, usage, lease contract, declaration at town hall, furnished classification, notice period for termination, tenant turnover frequency. |
| Comparison of tax regimes 💼 | Micro-BIC deduction (50% for furnished rentals, 71% for classified tourist rentals), income cap, advantageous taxation, recoverable VAT. |
| Best profitability 💹 | Steady and consistent income for furnished rentals, high profitability in peak season for tourist rentals but unstable over the year. |
| The main differences 🔍 | Rental duration (long vs. short term), tax regime (deduction, favorable taxation), rental flexibility. |
If you are a property owner considering leasing your property, you need to understand the difference between furnished rental and tourist furnished rental. Although they share similarities, these two types of rentals are governed by distinct regulations and offer different tax advantages.
What is a furnished rental?
Definition
A furnished rental is a type of housing offered for rent, which must be fully equipped to allow the tenant to move in immediately. Unlike an empty rental, where the tenant must supply their own furniture and equipment, a furnished rental already contains all essential elements, such as furniture, appliances, and kitchen utensils. The goal is that the tenant can live there without investing in additional furniture or equipment. Generally, furnished rentals are chosen for long-term stays, whether it is a primary or secondary residence.
The minimum required furniture for a furnished rental is defined by law. According to the Alur Law (Access to Housing and Renovated Urban Planning), the housing must contain at least:
- A complete bedding (including duvet or blanket),
- Shutters or curtains in the bedrooms,
- Cooking plates and an oven,
- A refrigerator and a freezer or freezing compartment,
- Kitchen utensils (dishes, pots, etc.),
- A table and chairs,
- Cleaning equipment (vacuum cleaner, broom, etc.).
This type of rental is commonly used in large cities where demand for furnished accommodations is higher, particularly by students, traveling professionals, or expatriates.
Regulations
Furnished rentals are governed by specific rules in France. The lease contract must be at least one year and is tacitly renewable annually. This duration can be reduced to 9 months when it concerns a student rental, in which case, the contract is not automatically renewable. The landlord may terminate the contract, but must respect a three-month notice period if they wish to end the lease (versus six months for an unfurnished rental).
The tenant, on their side, can also give their notice of departure at any time, respecting a one-month notice period. This flexibility in notice periods is one of the main advantages for tenants in furnished rentals. The lease agreements for furnished rentals must also comply with legal obligations such as the energy performance diagnosis (DPE), the habitable surface certificate, and the building’s internal regulations.
It should be noted that if the owner wishes to terminate the lease for legitimate reasons, they must provide a valid reason, such as personal use of the property or sale. In all cases, the rules applicable to furnished rentals ensure a certain protection of tenant rights.
Advantages and disadvantages
Advantages for the tenant
One of the main advantages for the tenant is the ability to move into a completely furnished property, reducing stress and costs associated with purchasing furniture. This is especially beneficial for people who need temporary accommodation, such as students or professionals on assignment. Furnished rentals also offer the tenant greater flexibility in managing their lease, thanks to the shorter notice period of one month. This makes it ideal for people in transition or those who do not want to be burdened with furniture they will later have to transport.
Advantages for the landlord
For the landlord, a furnished rental offers several financial benefits. The rent can be higher than that of an unfurnished rental, as the property is provided with all necessary equipment. Furthermore, the fiscal status of Non-Professional Furnished Landlord (LMNP) allows the owner to benefit from certain tax advantages, such as depreciation on furniture and equipment, thus reducing taxable income. There’s also the possibility to choose between the micro-BIC regime (with a flat 50% deduction) or the actual regime (allowing deduction of expenses and depreciation from taxable income).
Disadvantages for the tenant
However, furnished rentals can also have some disadvantages. Rent is often higher than for unfurnished rentals, which can be a financial burden. Also, since the furniture and equipment are imposed by the landlord, the tenant cannot fully personalize their living space to their taste.
Disadvantages for the landlord
On the owner’s side, the main disadvantage lies in the obligation to invest in furniture and equipment to ensure compliance with regulations. This entails higher initial costs and more complex maintenance and management. Indeed, the owner is responsible for any malfunction or replacement of equipment, which can incur additional costs over time. Moreover, the rotation rate of tenants is often higher in furnished rentals, requiring more time and effort to manage departures and arrivals.
What is a tourist furnished rental?
Definition
A tourist furnished rental is a fully furnished apartment or house, intended to be rented for short periods to tourists or passing travelers. Unlike traditional rentals, this type of property is specifically reserved for tenants who do not establish domicile there. Indeed, a tourist furnished rental cannot be used as a main residence. It can include various types of properties, such as houses, apartments, studios, or villas. These accommodations are often rented for vacation, business trips, or any other reason requiring temporary housing.
The stay durations in a tourist furnished rental are generally limited to a maximum of 90 consecutive days for the same tenant, but there is no limit to the number of different tenants over a year. Additionally, this type of rental is often used as an income stream for property owners to capitalize on their secondary residence when they are not occupying it themselves.
Regulations
Tourist furnished rentals are subject to strict regulations. The owner must declare their property at the town hall before renting it out. This declaration is mandatory, whether it is a primary or secondary residence. The declaration form (CERFA no. 14004*04) must be completed and submitted to local authorities, who will issue a registration number to be included in all rental advertisements.
In some municipalities, especially in tight zones (large cities with high demand for housing), a change of use permit may be required. This means that the owner must obtain approval from the town hall to transform their property, originally intended for habitation, into a property rented for tourist stays. This measure aims to regulate the real estate market and limit the impact of tourist rentals on the long-term housing supply.
Besides mandatory declaration, tourist furnished rentals can be classified. This classification is based on strict standards and is voluntary. It allows assigning from 1 to 5 stars depending on the quality of equipment, services offered, and comfort. This classification is validated by accredited organizations after an evaluation of the property and remains valid for a period of 5 years.
Advantages and disadvantages
Advantages
A primary advantage of a tourist furnished rental is the flexibility it offers. Owners can rent their property for short durations, ideal for vacation periods or seasonal demand. As an owner, you can easily adjust your rates based on the season (high or low), thus optimizing your income.
Another notable advantage is the tax benefit. A classified tourist furnished rental qualifies for a 71% tax deduction on rental income, versus 50% for a standard furnished rental. This deduction is especially advantageous if your rental income does not exceed 176,200 euros annually. This means only 29% of rental revenues will be taxable, significantly reducing tax burden.
Finally, classification as a tourist furnished rental enhances visibility on rental platforms like Airbnb or Abritel, where classified properties are often promoted to attract potential tenants. This classification also guarantees quality standards for travelers, which can justify higher prices for your rentals.
Disadvantages
However, obtaining the status of a classified tourist furnished rental also presents some disadvantages. Firstly, the classification process can be lengthy and complex. It requires engaging with an accredited body that will evaluate the property according to a set of criteria, ranging from available equipment to accessibility. If modifications or improvements are needed to meet classification standards, this can incur significant costs for the owner.
Additionally, while short-term rentals are more flexible, they demand more intensive management. Indeed, owners must handle numerous tenants throughout the year, which involves tasks such as greeting tenants, regular maintenance, managing arrivals and departures, and equipment upkeep. Some owners prefer to delegate these tasks to a concierge service or specialized agency, but this entails extra costs that may reduce overall profitability.
Lastly, in certain cities, renting as a tourist furnished rental is strictly regulated, with municipalities imposing restrictions on the number of days rental is permitted for a single property. Non-compliance with these restrictions can lead to significant financial penalties.
Comparison of Main Characteristics
| Criteria | Furnished rental | Tourist furnished rental |
|---|---|---|
| Rental duration | Long term (1 year, 9 months for students) | Short term (max. 90 days for a single tenant) |
| Usage | Primary or secondary residence | Exclusively for tourists, not a primary residence |
| Lease contract | Standard contract, renewable | Flexible rental, non-renewable |
| Declaration at town hall | Not necessary | Mandatory |
| Classified furnished | Not applicable | Possible, with tax benefits |
| Notice for termination | 3 months for the landlord, 1 month for the tenant | Not applicable (short durations) |
| Tenant rotation | Low turnover | Frequent rotation |
Comparison of tax regime
| Tax characteristics | Furnished rental (standard) | Tourist furnished rental (classified) |
|---|---|---|
| Tax regime | Industrial and commercial profits (BIC) | Industrial and commercial profits (BIC) |
| Micro-BIC deduction | 50% | 71% |
| Income ceiling (micro-BIC) | 72,600 € | 176,200 € |
| Advantageous taxation (classification) | Not applicable | Yes, with classification |
| Recoverable VAT | No | Yes, if classified as tourist rental |
Optimal profitability
| Criteria | Furnished rental | Tourist furnished rental |
|---|---|---|
| Type of rental | Long-term (primary or secondary residence) | Short-term (tourist, not primary residence) |
| Average monthly income | Steady but slightly lower | Higher during peak season |
| Annual potential income | Moderate and steady (regular income) | Fluctuating (peak tourist periods, off-season lows) |
| Occupancy rate | Stable and high (year-round) | Variable depending on seasonality |
| Nightly or weekly rate | Not applicable (monthly rent) | Higher, especially in peak season |
| Management costs | Lower (low rotation, less cleaning) | Higher (frequent turnover, check-in/out management, regular cleaning) |
| Concierge fees | Unnecessary or low | Often needed for frequent arrivals and departures |
| Utilities (water, electricity) | Standard charges | Higher charges due to quick turnover and intensive equipment use |
| Tax benefits | 50% deduction (micro-BIC) | 71% deduction (if classified as tourist rental) |
| Initial investment cost | Moderate (basic furniture) | Higher (quality furniture and equipment to attract tourists) |
| Overall profitability | Stable with consistent long-term income | High profitability during peak season but unstable throughout the year (seasonality dependency) |
The main differences between a furnished rental and a tourist furnished rental
Rental duration
The primary difference between a furnished rental and a tourist furnished rental lies in the rental period. A furnished rental can be leased for a long-term, without specific restrictions, whether for primary or secondary residence. It is thus possible to rent a furnished property for several months or even years. This flexibility allows tenants to establish residence in the rented property and stay long-term.
In contrast, a tourist furnished rental is reserved for short-term stays. The law limits it to 90 consecutive days for the same tenant, making it an ideal option for tourists or passing travelers. The tourist furnished rental is therefore designed for temporary occupation and cannot be used as a main residence.
Tax regime
From a fiscal perspective, both types of rentals are taxed within the industrial and commercial profits (BIC) category, meaning that income from these rentals must be declared as business income. However, a notable difference exists in the tax treatment of classified tourist furnished rentals.
A classified tourist furnished rental benefits from a more advantageous tax deduction than a standard furnished rental. In fact, a classified tourist furnished rental can enjoy a flat 71% deduction, meaning only 29% of the rental income will be taxed. Conversely, an unclassified furnished rental is subject to a 50% deduction under the micro-BIC regime. This difference makes classification especially attractive for owners aiming to optimize their tax situation.
Flexibility
Regarding flexibility, the tourist furnished rental offers greater freedom to the owner, particularly because it allows renting for short periods. Stays can last a few days, weeks, or months, depending on tourist demand. This enables owners to adjust rates based on seasonality and demand. Short-term rentals are especially suitable for tourist hotspots where demand fluctuations are significant.
Conversely, a furnished rental generally targets long-term tenants seeking stable housing, for example as their main residence. This type of rental is thus less flexible in terms of tenant turnover, but provides greater stability for the owner, with renewable yearly leases. The lower tenant rotation also reduces the daily management effort.
Conclusion
In summary, the choice between a furnished rental and a tourist furnished rental will depend on your objectives as a property owner. If you aim to maximize income through short-term stays, tourist furnished rentals are ideal. For more stable rentals, furnished rentals remain a reliable solution.
