Tourist furnished rentals: securing the operability of the asset (registration, change of use, co-ownership)

The City of Paris is actively policing short-term lettings, the platforms are blocking listings without a registration number, and the Law of 19 November 2024, known as the Le Meur law, has tightened the whole regime. For an investor, an institutional landlord or a purchaser, the question is no longer whether a unit earns more as a short-term let than as an unfurnished let: it is whether the unit will remain usable for short-term letting in three years, and in whose hands. The operability of a tourist furnished rental (meublé de tourisme) rests on three separate, cumulative authorisations, issued by three different authorities, two of which may disappear on resale. This guide sets out these three locks, the chronology of inspections and sanctions, and what the discount on a unit already operated as a short-term let frequently conceals from the incoming owner.

Three cumulative locks, three distinct legal logics

The most costly confusion in practice is to treat short-term letting as a single regime. It in fact falls under three bodies of rules that do not pursue the same object and never offset one another.

• The declaration at the town hall falls under the French Tourism Code (Article L. 324-1-1). It is declaratory, identifies the property and its lessor, and results in the issue of a registration number.
• The change of use falls under the French Construction and Housing Code (Articles L. 631-7 et seq.). It requires authorisation, protects the housing stock and, in Paris, conditions the operation of premises that are not the lessor's main residence.
• The co-ownership regulations (règlement de copropriété) fall under contract law and Law No. 65-557 of 10 July 1965. They are enforceable between co-owners and may prohibit the activity independently of any administrative authorisation.

A perfectly regular administrative authorisation does not neutralise an exclusive residential-use clause (clause d'habitation bourgeoise). Conversely, the tacit agreement of the co-owners does not cure any lack of change-of-use authorisation. These three locks add up, and each is enforced by its own authority and procedure: the municipality and the public prosecutor for change of use, the municipality for registration, the co-owners' association (syndicat des copropriétaires) for the regulations. In addition, at the periphery, are planning law, residential tenancy law and, since the Le Meur law, energy performance. The regime of prior declaration and authorisation of lettings arising from the ALUR law is examined in our article on the rental permit (permis de louer) under Article L. 635-1 of the Construction and Housing Code.

Lock No. 1: the tourist furnished rental declaration and the registration number

What the declaration covers, and what it does not

A tourist furnished rental is defined as a furnished villa, apartment or studio offered to a transient clientele who stay there for a period characterised by letting by the day, the week or the month, and who do not take up residence there (Article L. 324-1-1 of the French Tourism Code). The declaration is addressed to the town hall of the municipality where the property is located. In municipalities that have introduced the registration procedure, it results in a thirteen-character tourist furnished rental registration number, which must appear on every listing, whatever the platform.

This number is not an authorisation. It is neither permission to operate, nor recognition that the premises are regular as regards change of use, nor validation of the intended use of the building. It is a control identifier: it allows the municipality to match the declared premises against the nightly counts transmitted by the platforms and to detect breaches of the annual cap applicable to main residences. The opposite reasoning, which infers from the obtaining of a number that the operation is secure, is one of the most frequent audit errors.

The timetable under the Le Meur law

Law No. 2024-1039 of 19 November 2024 aimed at strengthening the tools for regulating tourist furnished rentals at local level, published in the Journal officiel of 20 November 2024, extends the registration procedure to the whole territory, through a national online service, according to a timetable fixed by the law and its implementing texts, with a roll-out deadline in 2026. Registration thus ceases to be an option reserved to municipalities in tight-market areas and becomes the ordinary regime.

The law at the same time reinforces documentary obligations: the municipality may require the declarant to produce supporting documents, in particular those showing that the premises are indeed the lessor's main residence, and may suspend or withdraw the number in the event of an inaccurate declaration. For a multi-unit operator, this power of withdrawal is a risk of immediate interruption of operations, without any court being involved.

Sanctions and practical effects

Failure to register exposes the owner to a civil fine imposed by the president of the judicial court (tribunal judiciaire) sitting under the accelerated procedure on the merits (procédure accélérée au fond), on the application of the municipality. The ceilings, raised by the Le Meur law, reach €10,000 for failure to register and €20,000 in the event of a false declaration or use of a number obtained by fraud. Exceeding the annual cap on letting a main residence is penalised separately. The operation of this procedural route and its interplay with summary proceedings (référé) and the summons for a fixed-date hearing (assignation à jour fixe) are the subject of our article on the accelerated procedure on the merits.

To these sanctions is added an operational effect that is often more immediate: platforms are obliged to remove listings without a valid number in the municipalities concerned and to automatically block lettings beyond the annual cap. Loss of the number is, in practice, equivalent to the end of marketing.

Lock No. 2: change of use and compensation

The principle and its scope

Article L. 631-7 of the French Construction and Housing Code makes the change of use of premises intended for residential use subject to prior authorisation, in municipalities of more than 200,000 inhabitants and in the départements of Hauts-de-Seine, Seine-Saint-Denis and Val-de-Marne. The text expressly states that repeatedly letting furnished premises intended for residential use for short periods to a transient clientele who do not take up residence there constitutes a change of use.

"Repeatedly letting furnished premises intended for residential use for short periods to a transient clientele who do not take up residence there constitutes a change of use within the meaning of this Article." (Article L. 631-7, paragraph 6, of the French Construction and Housing Code)

The compatibility of this regime with the Services Directive has been settled: the Court of Justice of the European Union, in its Cali Apartments judgment of 22 September 2020 (joined cases C-724/18 and C-727/18), held that such an authorisation regime could be justified by an overriding reason relating to the public interest, namely combating the shortage of housing intended for long-term letting. The Cour de cassation drew the consequences in a series of judgments of 18 February 2021, validating the Paris regime subject to a proportionality review of local rules. The argument of incompatibility with EU law, still pleaded, no longer has a serious future.

The main residence exception and the annual cap

Change of use is not required where the let premises are the lessor's main residence, meaning the home occupied for at least eight months a year. The counterpart is the cap of 120 days of letting per calendar year. The Le Meur law now allows municipalities that have introduced registration to lower this cap by resolution, down to 90 days a year. This power changes the yield structure of a unit operated as a main residence without any individual formality being required: a simple resolution of the municipal council is enough to cut operating capacity by a quarter.

Compensation in Paris: surface area, sectors, commerciality title

In Paris, authorisation of a change of use for premises that are not the lessor's main residence is subject to compensation, on the terms set by the municipal regulation adopted by the Council of Paris. Compensation consists of converting into housing premises of another use, of a surface area equivalent to that subject to the change of use, this surface area being doubled in the enhanced compensation sectors covering the central arrondissements and western Paris.

In practice, an operator that has no premises to convert acquires a commerciality title (titre de commercialité) from a third party, on a secondary market where the price per square metre makes up most of the entry cost. This mechanism explains the gap, often poorly anticipated, between the purchase price of a unit and the real cost of bringing it into tourist operation. The Le Meur law has also given municipalities the possibility of fixing, by reasoned resolution, a maximum number of temporary change-of-use authorisations, and of delimiting in the local urban plan (plan local d'urbanisme) sectors where new buildings are reserved for main residences. Access to the regime is being rationed: the stock of existing authorisations gains in value, but the prospect of new authorisations is closing.

Personal authorisation or authorisation attached to the premises: the decisive distinction

This is the point that determines the real asset value of a unit operated as a short-term let. Article L. 631-7-1 of the French Construction and Housing Code provides that the change-of-use authorisation is in principle granted on a personal basis and ceases to have effect when the beneficiary's professional activity is definitively brought to an end. But where the authorisation is subject to compensation, the title is attached to the premises and not to the person.

The consequence is immediate in due diligence. A unit operated under a temporary personal authorisation, issued without compensation, transfers nothing to the purchaser: the purchaser will have to apply for its own authorisation, with compensation, at today's market price. A unit benefiting from an authorisation with compensation, on the other hand, transfers a real right attached to the premises, which can be capitalised. Two physically identical units, showing the same tourist revenue, can thus have radically different operating values. Examination of the title, its nature, its duration and the surfaces compensated must precede any price negotiation.

Sanctions: the civil fine under Article L. 651-2 and return to residential use

An irregular change of use exposes the owner to a civil fine imposed by the president of the judicial court, on the application of the mayor or the public prosecutor, capped at €50,000 per irregularly converted premises (Article L. 651-2 of the French Construction and Housing Code). The judge further orders the return to residential use within a time that he or she fixes, under a periodic penalty payment (astreinte) of up to €1,000 per day and per square metre of usable floor area. On expiry of the period, the authorities may act of their own motion at the offender's expense and the eviction of the occupants may be ordered.

The sanction is therefore not only financial: it entails a return to unfurnished letting or residential use, that is, destruction of the operating model. It falls on the owner of the premises, including where the operation is run by a third party, which calls for particular attention to guarantee clauses in management mandates and in leases granted to operators.

Lock No. 3: short-term letting and co-ownership

Intended use of the building and residential-use clause

The co-ownership regulations are the law of the building. They are the lock most often overlooked, even though they are the only one that can be invoked by immediate neighbours, without administrative delay and with a periodic penalty payment at stake. The analysis rests on the distinction between two types of clause.

The simple residential-use clause (clause d'habitation bourgeoise) allows the practice of liberal professions, and even certain non-commercial activities, alongside residential use. The exclusive residential-use clause reserves the building for residential use alone and prohibits any professional or commercial activity. It is accepted in French law that operating a unit as a tourist furnished rental, characterised by sustained turnover of transient clientele, para-hotel services and permanent marketing, amounts to an activity of a commercial nature incompatible with an exclusive residential-use clause. The courts assess the activity in concrete terms: frequency of stays, average length, existence of ancillary services, nuisance recorded, use of the common parts.

The analysis must be based on the exact text of the regulations, including their published amendments, and not on a generic formula. A clause that prohibits any "furnished letting" or reserves the units for "private and residential use" does not call for the same reading as a clause admitting the practice of liberal professions.

What the Le Meur law changed in co-ownership

The Law of 19 November 2024 reinforced the information and decision-making power of the co-owners' association. A co-owner who declares a tourist furnished rental must now inform the managing agent (syndic), who brings this information to the attention of the general meeting. The question of placing on the agenda a prohibition or regulation of short-term letting thus becomes a recurring item in the life of co-ownerships.

The law also allows the general meeting, in buildings whose regulations provide for an exclusively residential intended use, to decide to prohibit the letting of tourist furnished rentals by the reinforced majority of Article 26 of the Law of 10 July 1965. Finally, co-ownership regulations drawn up after the law came into force must state expressly whether the letting of tourist furnished rentals is authorised or prohibited. The risk for the investor therefore changes in nature: it is no longer enough to comply with the current regulations, it is necessary to assess the likelihood that the co-ownership will adopt a prohibition in the medium term, according to the make-up of the building and the majorities that can be mobilised. On the different majority regimes applicable depending on the clause of the regulations that the meeting intends to amend, see our analysis of amendment of the co-ownership regulations.

The association's action and its timetable

The co-owners' association, or even a co-owner acting individually to defend his or her rights, may bring proceedings before the judicial court for an order to cease the activity under a periodic penalty payment, on the basis of Article 9 of the Law of 10 July 1965 and the co-ownership regulations, together with damages for loss of enjoyment. Summary proceedings may be used where a manifestly unlawful nuisance is established, which is frequently accepted in the presence of a clear clause and an activity established by a bailiff's report. Personal actions arising from the application of the 1965 law are time-barred after five years (Article 42 of the Law of 10 July 1965, as worded following the ELAN law of 23 November 2018).

The peripheral locks: lease, planning, energy performance

Three constraints complete the regime and condition operability over time.

• The residential lease. A tenant may not sublet without the landlord's written agreement, including as to price (Article 8 of Law No. 89-462 of 6 July 1989). Unauthorised tourist subletting exposes the tenant to termination of the lease and to the return to the landlord of the sub-rents received, characterised as civil fruits (fruits civils) of the property. For an institutional landlord, detecting listings relating to its units is a recovery stream in its own right.
• Planning law. Change of use within the meaning of the Construction and Housing Code is not the same as change of intended use (changement de destination) within the meaning of the French Town Planning Code, which distinguishes residential use from hotel and tourist accommodation. Works, a change to the facade or a structured para-hotel operation may trigger a prior declaration or a permit, with an autonomous regime of criminal penalties.
• Energy performance. The Le Meur law subjects tourist furnished rentals located in tight-market areas to energy performance certificate requirements, immediate for new lettings and deferred, according to the timetable fixed by the law, for the existing stock. The future operability of an energy-inefficient unit must therefore be assessed in light of renovation capex, exactly as for a commercial asset subject to the Éco Énergie Tertiaire scheme.

What the discount on a unit operated as a short-term let conceals

A unit sold with a tourist operation in place is sometimes negotiated at a discount presented as linked to occupancy or to age. This discount often covers an identifiable legal liability.

• A non-transferable personal authorisation, which does not survive the sale and requires the incoming owner to acquire a commerciality title.
• A pending procedure before the judicial court brought by the City, whose civil fine and periodic penalty payment will follow the premises and their owner.
• An inspection report already drawn up by the competent municipal department, not yet followed by a summons.
• A recent general meeting resolution prohibiting or regulating short-term letting, or a proposal placed on the agenda of the next meeting.
• Ongoing co-ownership litigation, or a formal notice from the managing agent that has gone unanswered.
• An energy performance certificate (DPE) incompatible with the timetable applicable to tourist furnished rentals in tight-market areas.

The minimum audit checklist, before signing a preliminary sale agreement (promesse de vente), comprises: the registration number and the declaration receipt, the change-of-use authorisation order with its nature and duration, the commerciality titles and evidence of the surfaces compensated, the co-ownership regulations and all of their published amendments, the minutes of general meetings for the last three financial years, the statement of proceedings provided by the managing agent, and the nightly counts for the last two years. The condition precedent must relate to the effective transferability of the right to operate, and not merely to the production of a registration number.

The tax treatment, in particular the tightening of the micro-BIC allowances by the Le Meur law to the detriment of unclassified tourist furnished rentals, enters into this reasoning only as one dimension of arbitrage among others. A favourable tax regime never makes up for a lack of authorisation: it only increases the opportunity cost once operations have stopped.

Deciding on operability, not on the advertised yield

The yield of a tourist furnished rental is an instantaneous figure; its operability is a legal datum, rationed and revocable. The Le Meur law has shifted decision-making power to the local level and to the general meeting: a municipal resolution may lower the annual cap, cap authorisations or reserve sectors for main residences; a majority of co-owners may prohibit the activity in the building. An investor who values an asset on the basis of past nights without having secured the real and transferable nature of its title is buying a flow, not a right.

Before any acquisition or any arbitrage on a unit operated as a short-term let, have a complete statement of the operating title drawn up: nature of the change-of-use authorisation, existence and amount of the compensation, intended-use clause of the co-ownership regulations and general meeting resolutions for the last three financial years. Make the price and completion conditional on that statement, and not on the mere existence of a registration number.

Frequently asked questions

Is the tourist furnished rental registration number enough to operate an apartment lawfully in Paris? No. The registration number results from a simple declaration under Article L. 324-1-1 of the French Tourism Code and serves to monitor compliance with the annual cap. If the premises are not the lessor's main residence, a change-of-use authorisation with compensation, issued under Articles L. 631-7 et seq. of the French Construction and Housing Code, remains indispensable. The co-ownership regulations must also permit the activity.

Is the change-of-use authorisation transferred to the purchaser of the unit? Only if it was made subject to compensation. Article L. 631-7-1 of the French Construction and Housing Code provides that the authorisation is personal, except where it is accompanied by compensation, in which case it is attached to the premises. A temporary personal authorisation therefore ceases to have effect for the incoming owner, who will have to put together its own application. This is the first point to check before valuing an existing operation.

Can a co-ownership prohibit short-term letting where the regulations are silent? Yes, subject to conditions. The Law of 19 November 2024 allows the general meeting, in buildings whose regulations provide for an exclusively residential intended use, to decide to prohibit the letting of tourist furnished rentals by the reinforced majority of Article 26 of the Law of 10 July 1965. Moreover, even in the absence of an express prohibition, an exclusive residential-use clause is frequently enough to stop the activity, tourist operation being analysed as commercial.

What sanctions apply to short-term letting without a change-of-use authorisation? Article L. 651-2 of the French Construction and Housing Code provides for a civil fine of up to €50,000 per irregularly converted premises, imposed by the president of the judicial court on the application of the mayor or the public prosecutor. The judge orders the return to residential use under a periodic penalty payment of up to €1,000 per day and per square metre of usable floor area. The authorities may then act of their own motion at the offender's expense.

Can the 120-day cap be reduced? Yes. The Le Meur law allows municipalities that have introduced the registration procedure to lower by resolution the annual cap on letting a main residence, down to 90 days per calendar year. No individual formality is required: the resolution applies to the existing stock. Any business model built on 120 nights must take this regulatory risk into account.

Can a tenant put their home on the tourist rental market? Not without the landlord's written agreement, including as to the price of the sublet (Article 8 of the Law of 6 July 1989). Failing that, the landlord may seek termination of the lease and the return of the sub-rents received, these being analysed as civil fruits belonging to the owner. For an institutional landlord, monitoring listings is a direct recovery lever.

What should be checked in the general meeting minutes before acquiring a unit operated as a tourist furnished rental? One must look for any resolution relating to short-term letting, any proposal placed on the agenda, any formal notice sent by the managing agent to an operating co-owner, and the statement of ongoing court proceedings provided by the managing agent. A prohibition voted between the preliminary agreement and completion deprives the purchaser of its operating model. The preliminary agreement should therefore include an express condition precedent on this point.