In Summary
| Section 🌟 | Details |
|---|---|
| Definition of Furnished Rental 🏡 | A housing unit equipped for immediate living, generally intended for long stays (main or secondary residence). |
| Minimum Furniture Required 🛋️ | 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-month notice for the landlord, one-month notice for the tenant, legal obligations such as 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 benefits (depreciation, choice between micro-BIC or actual regime). |
| Disadvantages for the Tenant ⚠️ | Higher rent, furniture mandated by the landlord, limited customization. |
| Disadvantages for the Landlord ⚠️ | High initial investment costs, more complex management, higher tenant turnover rate. |
| Definition of a Tourist Furnished Rental 🌍 | Furnished housing for short stays (max. 90 days for the same tenant), reserved for tourists, not a primary residence. |
| Regulations 🏛️ | Mandatory declaration at the town hall, possible permission for change of use, voluntary star rating classification. |
| Advantages 🌟 | Rental flexibility, 71% tax deduction if classified, better visibility on rental platforms. |
| Disadvantages ⚠️ | Long 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 for termination, tenant turnover rate. |
| Comparison of Tax Regime 💼 | Micro-BIC deduction (50% for furnished rentals, 71% for classified tourist rentals), income caps, advantageous tax treatment, recoverable VAT. |
| Best Profitability 💹 | Stable and consistent income for furnished rentals; high season profitability for tourist furnished rentals, but unstable throughout the year. |
| Main Differences 🔍 | Rental duration (long vs short term), tax regime (deduction, favorable taxation), rental flexibility. |
If you are a property owner considering renting out 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 that must be fully equipped to allow the tenant to move in immediately. Unlike an empty rental, where the tenant must provide their own furniture and appliances, a furnished rental already contains all essential elements, such as furniture, household appliances, and kitchen utensils. The goal is that the tenant can live there without investing in additional furniture or equipment. Generally, furnished rental is chosen for long-term stays, whether it is a primary or secondary residence.
The minimum furniture required for a furnished rental is defined by law. According to the Alur Law (Access to Housing and Urban Renewal), the housing must contain at least:
- A complete bedding set (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 the demand for furnished housing is higher, particularly by students, traveling professionals, or expatriates.
Regulations
Furnished rentals are governed by specific rules in France. The lease contract must have a minimum term of one year and is automatically renewable year by year. This period can be shortened to 9 months in the case of student rentals, and in such cases, the contract is not automatically renewable. The landlord can terminate the contract, but must respect a notice period of three months if ending the lease (compared to six months for an unfurnished lease).
The tenant can also give their notice of departure at any time with a one-month notice period. This flexibility in notice is one of the major advantages for tenants in furnished rentals. Lease agreements must also adhere to certain legal obligations such as the Energy Performance Diagnosis (DPE), the habitable surface certification, and the building regulations.
It should be noted that if the landlord wishes to end the rental to repossess the property for legitimate reasons, they must provide a valid reason, such as personal use of the property or sale. In all cases, the rules governing 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 fully furnished apartment, which reduces stress and the costs associated with buying furniture. This is especially beneficial for people who need temporary accommodation, such as students or business travelers. Furnished rentals also offer tenants greater flexibility in managing their lease, thanks to the shorter notice period. This type of rental is thus ideal for transitional or short-term tenants who do not want to be burdened with furniture they will have to transport later.
Advantages for the Landlord
For landlords, a furnished rental offers several financial benefits. The rent can be higher than for an unfurnished rental, as the property is offered with all necessary equipment. Additionally, the Non-Professional Furnished Landlord (LMNP) tax status allows owners to benefit from certain tax advantages, such as depreciation on furniture and equipment, reducing taxable rental income. There is also the option to choose between the micro-BIC regime (with a 50% deduction) or the actual regime (deducting expenses and depreciation from taxable income).
Disadvantages for the Tenant
However, furnished rentals can also present some drawbacks. The rent is often higher than for unfurnished options, representing an additional cost. Moreover, since furniture and equipment choices are mandated by the landlord, tenants cannot fully personalize their living space to their liking.
Disadvantages for the Landlord
From the landlord’s perspective, the main disadvantage lies in the obligation to invest in furniture and equipment to meet regulatory standards. This involves higher initial costs and more complex management in terms of maintenance of appliances. The landlord is responsible for any malfunctions or replacements, which can incur additional costs over time. Additionally, the tenant turnover rate 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 property intended for short-term occupancy by tourists or passing travelers. Unlike traditional rentals, this type of property is specifically reserved for tenants who do not establish domicile there. A tourist furnished rental cannot be used as main residence. It may include various types of housing, such as houses, apartments, studios, or villas. These accommodations are often rented for vacations, professional stays, or any other reason requiring temporary lodging.
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. Furthermore, this type of rental is often used as a way for owners to maximize returns on their secondary residence when not occupied by themselves.
Regulations
Tourist furnished rentals are subject to strict regulations. The owner must declare their property to 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 sent to local authorities, which will provide a registration number to be included in all rental advertisements.
In certain municipalities, especially in tight zones (large cities with high housing demand), a change of use authorization may be required. This means the owner must obtain approval from the town hall to convert their property, initially intended as a dwelling, into a property rented for tourism purposes. This measure aims to regulate the real estate market and limit the impact of tourist rentals on the long-term housing supply.
Along with the mandatory declaration, tourist furnished rentals can also be classified. This classification is based on strict standards and is voluntary. It allows the property to be rated from 1 to 5 stars depending on equipment quality, services offered, and comfort. This classification is validated by accredited organizations after an evaluation and is valid for 5 years.
Advantages and Disadvantages
Advantages
One of the main advantages of a tourist furnished rental is the flexibility it offers. Owners can rent their property for short periods, ideal for vacations or seasonal demand. As a property owner, you can easily adjust your rates based on the season (high or low), thereby maximizing your income.
Another significant advantage concerns taxation. A classified tourist furnished rental allows for a tax deduction of 71% on rental income, compared to 50% for a standard furnished rental. This deduction is particularly advantageous if your rental income does not exceed 176,200 euros per year. It means only 29% of rental receipts will be taxable, significantly reducing the tax burden.
Finally, classification as a tourist furnished rental provides better visibility on rental platforms like Airbnb or Abritel, where classified properties are often highlighted to attract potential tenants. This classification also offers a quality guarantee for travelers, which can justify higher rental prices.
Disadvantages
However, obtaining classified tourist furnished rental status also has some downsides. Firstly, the classification process can be lengthy and complex. It requires engaging an accredited organization to evaluate the property according to specific criteria, ranging from available equipment to accessibility. If modifications or improvements are necessary to meet the classification standards, this can entail significant costs for the owner.
Furthermore, while short-term rental offers more flexibility, it demands more intensive management. The owner must manage many tenants throughout the year, involving tasks such as welcoming tenants, regular maintenance, managing check-ins and check-outs, and equipment maintenance. Some owners delegate these tasks to a concierge service or specialized agency, though this adds additional costs and may reduce overall profitability.
Lastly, in certain cities, tourist furnished rentals are strictly regulated. Municipalities may impose limitations on the number of days a property can be rented out. Failure to comply can result in 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 the same tenant) |
| Usage | Primary or secondary residence | Exclusively for tourists, not a primary residence |
| Lease Contract | Standard, renewable | Flexible, non-renewable |
| Declaration at Town Hall | Not required | Mandatory |
| Classified Furnished | Not applicable | Possible, with tax advantages |
| Notice Period for Termination | 3 months for the landlord, 1 month for the tenant | Not applicable (short durations) |
| Tenant Turnover | Low rotation | Frequent rotation |
Comparison of Tax Regime
| Tax Characteristics | Standard Furnished Rental (classic) | Classified Tourist Furnished Rental |
|---|---|---|
| Tax Regime | Industrial and Commercial Profits (BIC) | Industrial and Commercial Profits (BIC) |
| Micro-BIC Deduction | 50% | 71% |
| Income Cap (micro-BIC) | €72,600 | €176,200 |
| Advantageous Taxation (classification) | Not applicable | Yes, with classification |
| Recoverable VAT | No | Yes, if classified as tourist furnished rental |
Best Profitability
| Criterion | Furnished Rental | Tourist Furnished Rental |
|---|---|---|
| Type of Rental | Long-term (primary or secondary residence) | Short-term (tourist, not primary residence) |
| Average Monthly Income | Stable but slightly lower | Higher during peak season |
| Potential Annual Income | Moderate and stable (regular income) | Variable (major tourist periods, off-season lows) |
| Occupancy Rate | Stable and high (year-round) | Seasonally variable |
| Price per Night or Week | Not applicable (monthly rent) | Higher, especially in high season |
| Management Costs | Lower (low turnover, less cleaning) | Higher (frequent turnover, check-ins/out, regular cleaning) |
| Concierge Fees | Unnecessary or low | Often needed for managing frequent arrivals and departures |
| Living Charges (water, electricity) | Regular charges | Higher charges due to rapid turnover and intensive equipment use |
| Tax Advantages | 50% deduction (micro-BIC) | 71% deduction (if classified as tourist furnished rental) |
| Initial Investment Cost | Moderate (basic furniture) | Higher (quality furniture and equipment to attract tourists) |
| Overall Profitability | Stable and consistent long-term income | High profitability during peak season but unstable throughout the year (seasonal dependence) |
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 duration. A furnished rental can be leased for a long period, without any specific restrictions, whether for primary or secondary residence. It is possible to rent a furnished property for several months or even years. This flexibility allows tenants to establish domicile in the rental property and reside there long-term.
In contrast, a tourist furnished rental is reserved for short-term stays. Law imposes a limit of 90 consecutive days for the same tenant, making it an ideal option for tourists or passing travelers. Therefore, tourist furnished rentals are designed for temporary occupation and cannot be used as main residence.
Tax Regime
From a tax perspective, both types of rentals are taxed under the industrial and commercial profits (BIC) category, meaning that income generated from these rentals must be declared as business income. However, there is a notable difference in the fiscal treatment of classified tourist furnished rentals.
A classified tourist furnished rental benefits from a more advantageous tax deduction than a standard furnished rental. Specifically, a classified tourist furnished rental can enjoy a flat deduction of 71%, meaning only 29% of the rental income will be taxable. By comparison, an unclassified furnished rental is subject to a 50% deduction under the micro-BIC regime. This difference makes classification particularly attractive for owners looking to optimize their taxes.
Flexibility
Regarding flexibility, tourist furnished rentals offer greater liberty to owners, especially because they allow renting for short periods. Stays can last a few days, weeks, or months, depending on tourism demand. This enables owners to adjust prices based on seasonality and tourist demand. Short-term rentals are especially suitable for tourist-heavy areas with significant demand fluctuations.
Conversely, a furnished rental is generally aimed at long-term tenants seeking stable housing solutions, for example as a primary residence. Such rentals are less flexible in terms of tenant turnover but provide greater stability for the owner, with renewable one-year leases. The tenant rotation being lower also reduces daily management efforts.
Conclusion
In summary, the choice between a furnished rental and a tourist furnished rental depends on your objectives as an owner. If you aim to maximize income through short-term stays, tourist furnished rentals are ideal. However, for more stable rental management, furnished rentals remain a reliable solution.
