When can I terminate my tenant’s lease and under what conditions can I increase the current rent? The termination of a lease and the revision of a rent are steps that should not be taken lightly since they are heavily regulated by law. We offer you a brief overview of the current regulations on this subject.
Conditions for Terminating a Lease
Whether you are a landlord or a tenant, certain rules must be taken into account to terminate a lease. Both furnished and unfurnished rentals are subject to the same rules with some nuances regarding the notice periods.
Both the tenant and the landlord must give notice and respect a notice period. The tenant can terminate their lease at any time with notice, while the landlord can only do so at the end of the lease term. To do so, it is sufficient to send the notice by registered mail with acknowledgment of receipt. The notice period will take effect from the receipt of the registered letter, notification by a bailiff, or hand delivery.
1 – For the Landlord
In the case of lease termination initiated by the landlord, the notice periods are as follows:
It should be noted that the landlord can terminate the lease only for the following reasons:
However, special attention must be paid to so-called protected tenants, who have additional protection, especially those aged 65 or over at the end of the lease with income below certain thresholds determined by decree.
2 – For the Tenant
Unlike the landlord who can only give notice at the end of the lease and must justify their decision, the tenant can terminate their lease at any time and without reason. The law of July 6, 1989, known as the Mermaz law, governs the relations between landlords and tenants. Article 12 allows the tenant to “terminate the lease at any time,” provided they respect a notice period with the following legal durations:
Since the Macron law of August 6, 2015, all unfurnished rental contracts benefit from all the reduced notice reasons provided by the Alur law, regardless of their signing date. Thus, the tenant can benefit from a reduced one-month notice in the following cases:
When and under what conditions can I increase my tenant’s rent?
The revision of rents within a lease is highly regulated. Therefore, it is strongly recommended to be well informed before undertaking such a step. The rent can be revised in three scenarios:
1 – During the Lease
The rent can be revised at the landlord’s initiative once a year, on the date indicated in the lease or on the contract’s anniversary date, provided a revision clause expressly provides for it in the contract. From the date specified in the lease, the landlord has one year to request the revision from the tenant. The new rent will apply from the day of the request.
It can also be increased following renovation work carried out by the landlord. The tenant’s agreement is then necessary to increase the rent. In this case, a clause in the lease (or an amendment) must indicate the amount of the rent increase after the completion of the work.
The annual rent increase cannot exceed the variation of the Rent Reference Index (IRL) published quarterly. Article 17 c of the law of July 6, 1989, requires that the new rent be set “by reference to the rents usually observed in the neighborhood for comparable housing.” The landlord must then prove that their rent is “manifestly undervalued.”
The annual revision is calculated as follows:
Rent revision is not automatic and is not mandatory.
2 – Rent Revaluation Upon Lease Renewal
At the time of lease renewal, the landlord can propose a rent increase if it is manifestly undervalued.
To do this, the landlord can propose to the tenant at least six months before the lease’s end (lease duration reminder: 3 years for unfurnished rentals, 1 year for furnished rentals) a new rent set by reference to the rents usually observed in the neighborhood for comparable housing according to the IRL by sending their proposal by hand-delivered letter, registered letter, or notification by a bailiff.
The proposal must cite Article 17-2 II of the law of July 6, 1989, and contain the precise references justifying the new rent:
The increase is then decided by agreement between the tenant and the landlord or by court decision:
Good to know: CDCs (Departmental Conciliation Commissions) are organizations that help landlords and tenants find a solution to their dispute without going to court. They intervene for free. To consult the list of CDCs, click here.
3 – Setting the Rent When Renting Out the Property
The methods for setting rents vary depending on the geographical location of the rental property.
Rent Setting in Tight Zones:
A tight zone is defined as “urban areas of more than 50,000 inhabitants where there is a marked imbalance between housing supply and demand, leading to serious access difficulties to housing in the entire existing residential park, characterized in particular by high rent levels, high acquisition prices for old housing, or a high number of housing applications compared to the number of annual moves in the social rental park.”
In tight zones, the rent amount is regulated. The rent amount must be the same as that of the previous tenant.
To find out if your housing is in a tight zone, click here.
The rent can be set freely only if the housing:
The rent can be re-evaluated upon re-rental:
On an experimental basis for five years, some municipalities can set additional rent controls by establishing ceilings. In this case, the rent cannot exceed both:
To date, these cities apply this system (by mid-2024):
Montpellier and Bordeaux will join the system as soon as the legal decrees will be published.
Rent Setting in Loose Zones:
In loose zones where rental pressure is not high, the rent is freely set between the landlord and the tenant.
Content provided for informational purposes and does not replace the current regulations. Without consultation with our experts, PATRIMOLINK cannot be held responsible for any consequences of applying the advice and information provided in this article.
