Capitale Partners - EN
What kind of lease ?

What kind of lease ?

Having access to a real estate specialist provides a guarantee for your transactions and access to up-dated information about your rights and obligations.

CAPITALE PARTNERS, both as an intermediary and consultant, will assist you at each of the various rental stages, particularly in drawing up a lease which is fair and adapted to your personal circumstances.

Therefore, the joint provisions in our leases include:

The duration and the methods of terminating the lease are however now subject to the ‘Loi de cohésion sociale’ (Tax Exemption Law), or Borloo Law, of January 2005 and Loi Alur of March 2014.

A lease duration decided by common consent

The parties together agree on the length of the lease and can in this way adapt the contract to their own requirements. A renewal, its duration and periodicity may be planned either tacitly or expressly as a function of the tenant’s position, whether as an individual, a corporate body, or even a student.

Warning: if you own more than four furnished properties intended for rental, you are subject to the provisions of Article 126 of the law of 26th July 1998, codified under Articles 632-1 et seq. of the Code de la Construction et de l’Habitation (Building and Housing Code) which restricts the flexibility of a lease (minimal rental term of one year, reduced notice period, reasons for said notice,…).

Individual person in principal residence: the lease must be agreed for a duration of one year renewable by tacit agreement.

Individual person in secondary residence: the duration can be written into the lease for at least one year, renewable, either by express agreement of the two parties, or by tacit agreement.

Corporate body, for a seconded worker, the duration is decided by common consent and renewable between the parties.

Student: the rental is considered as the principal residence of a student for the duration of the academic year even if he lives with his parents for tax purposes, the lease being concluded for a period of nine months without tacit renewal.

Means of terminating a lease

By the tenant:

The tenant, an individual, for his principal residence, may terminate a lease at any time, provided he gives the lessor one month’s notice by registered letter with proof of receipt.

The tenant of a secondary residence, an individual, may terminate a lease at any time, provided he gives the lessor three months' notice by registered letter with proof of receipt, the notice period may be reduced to one month in the event of a transfer, loss of employment...

The tenant, a corporate body, may terminate a lease at any time, provided he gives the lessor three months' notice by registered letter with proof of receipt. This period applying to the occupant and not to the current tenant, the notice period may be reduced to one month – unless otherwise specified – in the case of the occupant’s duly justified professional reasons, (transfer, occupant’s loss of employment).

A student tenant may terminate a lease at any time, provided he gives one month’s notice.

By the landlord:

The landlord, can terminate the lease of a tenant of a principal residence by giving the tenant three months’notice before the scheduled expiry of the lease or of one of its renewal periods, by registered letter with proof of receipt, justifying his decision (regaining the accommodation for himself or for sale, for legitimate and genuine reasons…)

The landlord of accommodation that is classed as a temporary or secondary residence, may give notice for the expiry of the lease, three months before the expiry date of the lease, by registered letter with proof of receipt,without having to give any reason.

The idea that a landlord may regain possession of a furnished apartment, whenever he wishes during the lifetime of the lease, must be abandoned.

The tenant and the landlord must both respect their obligations until the end of the notice period.

See the chapter Practical Guide to furnished lettings A flexible legal framework, protected… contractual freedom.

Warning: if you own more than four furnished properties intended for rental, you are subject to the provisions of Article 126 of the law of 26th July 1998, codified under Articles 632-1 et seq. of the Building and Housing Code which restricts the flexibility of a lease (minimal rental term of one year, reduced notice period, reasons for said notice,…).

Rents now controlled in Paris...

In Paris, monthly rents –excluding charges- are now controlled and fixed by the Prefect of the Ile de France region (Order of 25 June 2015: 2015-175-0007) for all contracts for individuals with effect from 1st August 2015. Paris comprises 14 zones; the assessment to the nearest centime is determined depending on the type of rental (furnished or unfurnished), the number of rooms, age of building. It can be weighted higher up to a justified maximum of 20%. Rental charges are added to the determined controlled rent. None of the other French départements (administrative regions) are subject to this control.

.. but exceptional rental supplements are possible

For accommodation that is in a highly desirable location or that is particularly comfortable, an “exceptional rental supplement" may be added to the basic rent for services that have not been taken into account by the Observatoire des loyers (parking, terrace, view of a monument, view across a park, outstanding location, modern day comforts, multimedia, etc.). Details to be specified by decree.

The tenant, however, has the right to challenge this additional rent by lodging an appeal to the Commission Départementale de Conciliation (Local Conciliation Commission) within three months of signing the lease.

Our Production Department can provide you with a personalized and calculated study as well as a free evaluation of your property. Right from the very first contact you will benefit from the services of a specialist team.

Service and maintenance charges included

The service and maintenance charges, known as charges “recoverable” by the owner may be included at a flat rate within the rent. In this case, the charges will be provisional, adjusted at subsequently at duly justified and agreed dates. These charges represent the maintenance charges for the building, the common parts, hot water, central heating, the caretaker’s salary or surveillance and possibly local rates.

In furnished property, the charges are often included and fixed due to the fact that the rentals may be for less than one year and that the annual statement of charges may arrive well after the tenants have left. The estimated amount must however be realistic. With the Law Alur, the amount even fixed of building charges must be written on the lease

Increase in rents

The contract allows for an increase in rent each year on the contract’s anniversary date, the increase being in accordance with the reference index that is given.

Note: The Cost of Construction Index – ICC was replaced by the Rental Reference Index – IRL in February 2008. This index is published each quarter by the INSEE - the National Institute of Statistics and Economic Studies.
The latest index to appear was that for the 4th quarter of 2014: 125,29. Over one year this represents an increase of 0.37%. In the case where the index falls and even becomes negative, the tenant is justified in asking for the rent to be reduced…

Method of calculating the annual revision:

Year N + 1

Current rent X news IRL index
old IRL index

Year N + 2

Already revised rent X new index
IRL index for year N+1

Good news: forgotten to increase the rent? A retroactive claim can be made against the tenant for a period of up to 5 years. (

Guarantees and/or security deposits required from the tenant

For furnished rentals, a security deposit of 2 months’ rent is required for all our contracts. For unfurnished rentals, the security deposit represents 1 month rent. It is used to guarantee that the tenant fulfils his obligations and cannot be used for investment purposes by the landlord. It will not acquire interest, and will be reimbursed to the tenant within a maximum of two months after his vacating the premises and his return of the keys.

Having studied the rental candidate’s file, it may be necessary to request a personal or bank guarantee.

For this there are two solutions :

- A bank guarantee whose duration corresponds to that of the lease, drawn up by a (French) bank where the tenant has an account.

- A personal or joint guarantee, set up for the duration of the lease and its renewal period(s) by our Legal department, whereby a person or a company presenting excellent guarantees undertakes to pay the rent and charges should the tenant be unable to pay.

An insurance policy covering rental risks:
The tenant is obliged by law to take out a multi-risk household insurance policy on the date of entry to the premises which covers all “risks for the tenant” (i.e. fire, water damage, etc.). CAPITALE PARTNERS can a variety of policies that are among the best on the market, negotiated with our AXA broker.

Systematic inspection report and inventory of the contents:
A detailed inspection report and inventory of the contents are prepared with both parties being present, or at the request of either of the parties, by a bailiff (“huissier de justice”). These documents are drawn up by CAPITALE PARTNERS at the time when a tenant takes possession and when he vacates the property. They must be prepared as carefully as possible in order to avoid any possible conflicts. These documents should then be attached to the lease.

Compulsory maintenance of individual items of equipment:
The tenant must take out an annual maintenance contract for each individual item of equipment (e.g. gas boiler,...). The tenant is solely responsible for paying the annual maintenance. If the contract remains in the landlord’s name, the latter can then ask to be reimbursed. Example of compulsory maintenance Example of individual items of equipment

Compulsory cleaning of the premises at the end of the contract:
According to the contract, the tenant is obliged to return the rented premises in a good state. Under the terms of the lease, the tenant may if he wishes employ the specialist cleaning services of CAPITALE PARTNERS for a preset fee.

Obligatory property diagnoses

Following the extensive reworking of the Building and Housing Code in 2005 and 2006, from now on for any empty or furnished rental property, it is advisable to prepare in order to be appended to the lease:

The Statement of natural, mining and technological risks -ERNMT (dated less than 6 months ago):
This document in application of Articles L 125 - 5 and R 125 - 26 of the Code of the environment, includes the prefectoral decree, the charter and the situation of the building. It warns of possible natural risks, where applicable: flood, drought, landslip, presence of quarry…) and technological risks (industrial, biological…) to which the building could be exposed.

This document although having only an informative value, is obligatory and its absence could lead to the lease being annulled. Example of the Statement of natural and technological risks -ERNT

Energy efficiency diagnosis-DPE (dated less than 10 years ago):
This document, valid for 10 years, has been mandatory since 1st July 2007 for rentals. The DPE must be carried out by a specialist engineer. It reports on the amount of power consumed by the property as a function of several measured parameters. Thanks to its informative value, the tenant will make his choice of accommodation in possession of all the facts. In the case of a bad energy efficiency report and its recommendations for improvements, the compliant owner will be able to take such measures as are necessary to make the apartment or the house more comfortable from this point of view (double glazing, insulating a north-facing gable, etc.). Example of Energy efficiency diagnosis-DPE

Lead diagnosis-CREP:
The initial CREP diagnosis is mandatory for rentals of properties built before 1st January 1949. It lasts for six years. In the absence of lead, it is valid indefinitely. Its purpose is to detect, where applicable, the presence of lead in the paintwork. It serves to limit the risks of poisoning in young children due to their exposure to lead. This diagnosis is of a more constraining nature than the two preceding ones : where lead is present, the removal of the offending paintwork is obligatory in order to eliminate the risk. A new investigation must then reveal that no lead is present. Example of Lead diagnosis-CREP

Diagnosis asbestos:

This test indicating the presence or absence of asbestos must be carried out in buildings whose building permit was issued before 01/07/1997. The report is valid indefinitely. It must be kept available for the tenant but not attached to the lease. The Alur Law specifies that it must be attached to the lease from 2016.