A guide to renting out your holiday home in France
Many second-home owners in France choose to let their holiday home. It can be a fantastic way to earn a few extra pennies and cover the costs of the upkeep of the property. Whether you’re buying a French country farmhouse or luxury apartment in Monaco, if you’re thinking of buying a property in France to rent out as a holiday let, it’s important that you do your research.
Here are our top tips when renting out your French property.
Where are the best locations for holiday rentals in France?
If you’re planning to rent out your French holiday home, consider what the area has to offer. Generally speaking, holiday makers want some amenities close by. While you may have fallen in love with a rustic, rural gîte in the middle of nowhere, remember that not necessarily everyone will share your love of peace and quiet. So, if you’re investing in a property in France to provide a healthy return on investment make sure you do your research and find out what the local holiday rental market is like. Your French estate agent should be able to offer advice on this.
Good access is also crucial, if people can’t get to the property easily it’s unlikely to be their top choice for a relaxing holiday. Is the property easy to get to by road? Is there a train station nearby? How far away is the nearest airport? It’s also worth checking that airlines run flights all year round. Some airlines dramatically reduce their service out of peak season.
Properties in coastal areas and city-centre locations often provide an opportunity to charge premium rates, but don’t forget the price tag of the property is likely to be higher too. Properties in tourist hotspots that appeal to holiday makers year-round like Paris, Bordeaux or Nice, are more likely to have high occupancy rates whereas ski chalets and summer retreats will, of course, be subject to seasonal fluctuations.
So, depending on where in France your property is located you may find that there are vacant periods, out of peak season and you’ll need to budget accordingly. Which brings us on to our next point…
Consider all of the costs of renting your French property
Before committing to a property purchase in France it’s crucial that you make sure the finances work for you. Remember to factor in additional and ongoing costs, such as French property taxes, utility bills, management fees and maintenance costs.
There are always unexpected costs too – the boiler packing in, a leaky tap or a broken appliances – usually at the most inconvenient time! We recommend keeping some emergency funds in reserve to help take the stress out of these situations.
If you’re earning an income from your holiday rental, you’ll also need to pay income tax in France, which is charged at 20 per cent of the net income, whether you are resident in France or not. You will need to submit a tax return to the French authorities regarding your rental income in France as well as declare the income to the tax authority in your own home country. However, France has a double taxation agreement with most countries, and therefore it’s unlikely that you’ll need to pay tax twice, although you may be expected to pay the difference if the tax owed in France is lower than the amount you would owe in your home country.
In addition, currently non-residents of France are liable for a social charge (prélèvements sociaux) of 17.2 per cent of their net income. This is likely to change in 2019, with talks of the social charges being contrary to EU legislation. Nevertheless, there may be an increase in income tax and the introduction of a solidarity tax (prélèvement de solidarité) at 7.5 per cent, so watch this space!
It’s also worth considering whether it’s best to register as a professional landlord and pay these taxes under the régime reel as opposed to under the standard micro tax status as it can be more cost-effective depending on your earnings. In addition, if you choose to be taxed under the régime reel and have a mortgage on your French property, you are entitled to deduct the interest costs from your tax bill.
Managing your holiday bookings and property in France
If you’re planning on buying a property in France and are not based there yourself, you’ll need to consider who will manage your French holiday let. Who will handle the bookings? How will you receive payments? Who will be responsible for the cleaning, laundry and greeting guests?
Travel websites may, allow you to manage bookings and payments remotely from anywhere in the world. However, you’ll still need someone on site to handle cleaning, laundry, general maintenance and either greeting guests with keys or ensuring keys are left in a secure location for guests, so it might be more convenient to use a holiday lettings company that offers a full service, from taking bookings to cleaning and maintenance. This obviously comes at a greater cost though. Some people choose to use to manage their own bookings and use a local property management company or source a local individual that they can trust to handle the cleaning and key exchanges etc.
Remember that it may be more difficult to find someone to take on these duties in very rural areas that are difficult to access, or you might pay a premium for the service, as a result. So, before committing to buying a property in France check whether you can access these services in your area.
When viewing properties in France, ask around for recommendations of holiday letting management firms or individuals who provide these services in the region. You may find that if you’re buying a property that has previously been rented out as a holiday home, that you can just continue to use the services all provided.
Follow the French holiday rental rules
If you choose to rent out your French property you must inform your local Mairie (town hall). You will also need to apply for a ‘non-professional Siret number’, which proves you are properly registered as having a rental property. This can be done easily enough at the local tax office.
As mentioned above, you must also declare your rental income from the property with the tax authority and pay any taxes owed. It’s worth noting that the tax year runs from January to December in France.
Get French holiday home insurance
Make sure that your property in France is adequately insured as a holiday home as opposed to a standard building and contents policy. Does the policy cover public liability insurance? Are you covered for when your property is not occupied? Does it cover you for loss of rent or income?
Standard home insurance policies are usually geared up for main residences and are not necessarily fit for purpose for a holiday let. For instance, standard home insurance policies are usually only valid if the property is not unoccupied for more than 30 days a year, which may not be the case. So, make sure the policy meets your full requirements.
For more information about the cost of buying property in France or any other queries about buying property in France, please contact our friendly team on 01244 478 911 or email firstname.lastname@example.org.
You can also download our handy Buying in France guide!
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Article published: December 20, 2018