Real estate in France is governed by a set of property laws and regulations designed to protect the rights of owners, tenants, and to ensure transparency and security in real estate transactions. Whether you're French or a foreigner looking to buy real estate in France, it's important to understand the laws, regulations, and different property statuses.
In real estate listings, we often find two areas: the total area and the Carrez area, which corresponds to the private part of the home, thus excluding the exterior, stairs, or areas with too low ceilings, for example. This law applies only to condominium properties!
The DPE is a mandatory diagnosis for any sale or rental of a real estate property in France. It assesses the energy performance of the property by providing information on its energy consumption and environmental impact. The DPE ranks the property on a scale of letters (from A to G) to indicate its energy efficiency, as well as an evaluation of greenhouse gas emissions.
Since 2023, regulations around the DPE have tightened in France. Today it has become prohibited to rent a property rated G, and soon the same will apply to properties rated F and E.
Real Estate Investment Incentive Laws: Malraux Law, Denormandie Law, and Pinel Scheme
Pinel Scheme: The Pinel scheme offers tax reductions on rental investment for new housing, if the owner commits to renting the housing unfurnished as a primary residence for a minimum period of six years.
The Urban Pre-emption Right (DPU) gives certain local authorities the right to purchase a real estate property for sale on their territory in priority. Buyers must be aware of the existence of this right and check if it applies to the area where they wish to purchase.
The Scrivener law, or “withdrawal law,” was established to protect buyers using a mortgage loan, offering them a ten-day reflection period to carefully examine the bank's offer.
France, known for its rich architectural heritage, has implemented special protection rules in certain villages and regions to preserve their historical character. "Historic Monuments," "Classified Sites," and "Protected Sectors" are subject to strict rules governing construction, renovation, and even the color of facades. These regulations concern classified properties but can also affect nearby buildings.
The Local Urban Plan is a town planning document that sets the general rules for land use in a municipality's territory. It determines, in particular, the constructible zones, rules of height and density, reserved locations, etc. Foreign buyers must consult the PLU to understand the urban planning constraints applicable to the area where they wish to purchase.
In France, constructions must comply with quality and safety standards defined by current regulations. This includes thermal standards (RT2012), energy performance standards, seismic standards, etc. Buyers must ensure that the property they intend to purchase complies with these standards.
In many French cities, urban development and architecture plans are developed to guide urban development and preserve the identity of neighborhoods. These plans can define specific rules regarding architecture, landscape, construction materials, etc.
In France, there are several property statuses, each with its own legal and fiscal implications:
The owner holds full ownership of the real estate property, which gives them the right to freely dispose of it (sell, rent, bequeath).
The owner retains the right to use and collect income from the property, while the usufructuary has the right to use it. For example, a parent may hold the usufruct of a property and allow their child to occupy it.
The owner holds the property but does not have the right to use it. However, once the usufruct ends, bare ownership transforms into full ownership.
Being aware of French regulations regarding property, construction, and heritage preservation is important when purchasing real estate and can help avoid surprises! Make sure to thoroughly understand the legislation surrounding your property to know which renovations are feasible!
