Complete rental management: Landlord's guide

Introduction

Rental management represents a set of legal, fiscal and administrative obligations that all landlords must master to secure their real estate investment. Between drafting the lease, collecting rent, managing the security deposit and annual regularization of charges, the steps are numerous and governed by a dense legislative arsenal: law of July 6, 1989, ALUR law of 2014, ELAN law of 2018, without forgetting the provisions of the Civil Code. This guide is aimed at the small owner with one to three properties as well as the seasoned investor or professional manager. It covers the essential points of compliant, profitable and sustainable rental management, emphasizing good practices and pitfalls to avoid.

1. Drafting and signing the lease

The lease contract is the cornerstone of the rental relationship. Since the ALUR law of March 24, 2014 and its implementing decree of May 29, 2015, the residential lease must comply with a mandatory standard model for empty (main residence) and furnished rentals. It must mention in particular the identity of the parties, the precise description of the accommodation, the living space (Boutin law), the amount of the rent, the duration (3 years for an empty lease, 1 year for a furnished one), and the terms of revision.

Several mandatory annexes must accompany the lease: technical diagnosis file (DPE, report of the risks of exposure to lead, state of natural and technological risks), information notice of the rights and duties of the parties, and co-ownership regulations if applicable. Since July 2021, a DPE classified F or G is subject to rent review restrictions, and since 2023, housing classified G+ is prohibited for rental.

In tense areas (28 urban areas defined by decree), rent control applies, particularly in Paris, Lille, Lyon, Montpellier and Bordeaux. The lessor must respect an increased reference rent under penalty of administrative sanctions.

2. Rent management and annual review

Regular collection of rents constitutes the heart of rental profitability. The lessor must issue a receipt free of charge upon each request from the tenant (article 21 of the 1989 law). The rent can only be revised once a year, on the date agreed in the lease, on the basis of the Rent Reference Index (IRL) published quarterly by INSEE.

Since the law of August 16, 2022 relating to purchasing power, the increase in the IRL is capped at 3.5% for housing classified A to E, and frozen for thermal strainers (F and G). In the event of unpaid debts, the lessor has several levers: formal notice, activation of the termination clause, order to pay by bailiff, and referral to the protection disputes judge. Unpaid rent insurance (GLI) or the Visale public guarantee system can secure income.

3. Security deposit and inventory

The security deposit is strictly regulated: it cannot exceed one month's rent excluding charges for an empty lease, and two months for a furnished one. It must be returned within one month after handing over the keys if the exit inventory is in compliance, or two months in the event of damage. Beyond that, penalties of 10% of the monthly rent per month of delay apply.

The inventory of entry and exit premises, carried out contradictorily, constitutes the key document to justify any deduction. It is advisable to complete it with dated photographs and a detailed inventory for furnished accommodation.

4. Regularization of charges

The lessor may request monthly provisions on recoverable charges (decree no. 87-713 of August 26, 1987) including water, collective heating, maintenance of common areas and household waste tax. A mandatory annual regularization must be carried out with supporting documents, communicated to the tenant one month in advance. In the absence of regularization within three years, the lessor loses his right to recall.