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Investment Property France: How to deal with a tenant who is not paying rent in France

The buyer would ideally been informed by a French lawyer in the process of french investment and acquiring properties for sale in France.<br>When buying an investment property in France, you donu2019t think the tenant could not pay rent. It happens sometimes with rental properties in France (French Alps, riviera, Paris u2026).<br>The rental income of this French property funds the payment of your mortgage. You have to move quick and efficient. Only a specialized lawyer in France can provide you with this results on the long term.

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Investment Property France: How to deal with a tenant who is not paying rent in France

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  1. French Leaseback

  2. Leaseback Properties Contract written with wilful misrepresentation (indemnited’eviction) Leaseback properties in France. Private individuals agreed to a leaseback scheme in France (buying and renting to an operating company)

  3. Summary • The operator (tenant) waives the eviction compensation in the commercial lease, knowing that this waiver is not valid (not enforceable). • The judges cancel the lease. The operator of the French leaseback property (tourist residence) is not entitled to an eviction indemnity (damages called in French : indemnitéd’éviction). • The bad faith of the tenant, who drafted the commercial lease turns against him. • This case law could be a huge step forward in the right of owners of a French leaseback property.

  4. Abstract The (tenant) lessee, is a company specialized in the management of leaseback properties. However, the operator writes the lease with bad faith. Because he pretends to waive in advance his right to damages, if the the lessor end the contract. (eviction indemnity/(damages called in French : indemnitéd’éviction).

  5. BUYING / SELLING or RENTING a real estate in France can be tricky You want to buy or sale a French Leaseback or a property.

  6. Many issues arise when you buy and sell or rent real estate in France : • Breakdown of appliances before settlement • Rent review in France • Buying real estate in France: Preliminary agreements • Deposit after signing a preliminary agreement ? • What contract should my French lawyer review ? • Selling Real Estate in France • Choosing a Real Estate Agent in France • What kind of contract should I sign with the real estate agent in France ? • Eviction of a Tenant in France (unpaid rent) • Buying property in France that needs refurbishing • Real estate Latent Defects (hidden defects) • Can I terminate the lease ?

  7. LEASE BACK INVESTMENTS IN FRANCE ARE COMPLICATED

  8. There are specific considerations for French lease back investments : • Termination of a Commercial Lease due to unpaid rents • Termination of a Commercial Lease in France • Charges and Commercial Lease in France • Obligations of the managing/operating company • Responsibilities for lease hold repairs. • Selling a Commercial Lease in France • Legal solutions and Litigation in France • The notice period under the French Law • What should I do if my tenant in France is not paying rent ? • 4 pitfalls to avoid when investing in a student residence • Trap: serviced residence rents which are too high • Service premises in a co-ownership

  9. French leaseback problems

  10. Since the 80’s and the 90’s, several thousand of owners bought leaseback property in France. The operating company states the return profit would be 4 % to 5 % per year. Sometimes the builder sells himself the real estate.

  11. During the 2000s, the operators marketed the French Leaseback overseas and especially in the UK and Italy. It was marketed as a risk-free and high return investment. The leaseback schemes were aimed to put enough renting properties on the touristic areas of France. The government and the big leaseback companies present it as a win-win solutions for operator, investor and the economy. The leaseback companies lobbied the MP’s int the French Parliament.

  12. A lot of buyers thought they will be able to have a holiday home in France after 9 years (or at least 20 years).

  13. Tax cuts, vat refund and rental income

  14. The purchaser benefits of a VAT refund, because his deal is funding a new build in France. The operating companies and/or the construction company doesn’t has to finance with costly bank loans.

  15. The french tax agency does not collect VAT on these sales. This tax cut comes from the french law voted by the Parliament. The French government wants to boost the real estate industry. Construction and tourism are creating a lot of jobs in France. The idea is to put on the market enough holiday homes and flats to rent for few days or a week.

  16. Theleaseback scheme works around an operator, who rents to tourists or students. The operating company has to paid guaranteed rent. It means the yearly rent is the same, even if the flat isn’t rented during the low-season. The leaseback owners are supposed to be paid every year without having to care about the daily business of the tenant.

  17. THANK YOU FOR WATCHING OUR PROJECT Please Visit Our Wabesite https://frenchrealestatelaw-traesch.fr/leaseback-indemnite-eviction/ https://frenchrealestatelaw-traesch.fr

  18. THE END

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