##Rent Controls in France
Although, as a general rule, landlords are free to set their own rents on new tenancies, over the past decade several controls have been introduced.
These controls apply more stringently in areas of housing stress and to the energy performance of the dwelling.
Short-term furnished rentals are exempt from any such regulations, provided the property is not the principal residence of the tenant. Accordingly, those who let a gite or other similar holiday accommodation are not affected by the rules.
For all other dwellings, provided there is provision in the rental agreement, a landlord can increase the rent once a year.
Nevertheless, the increase cannot be any greater than the increase in a rental index, called the Indice de Référence des Loyers (IRL), which the government publishes every quarter.
This index applies on a national basis, with no variations for the location of the property. It applies across the country.
Since August 2022, the IRL has been overridden by a rental shield, called the bouclier loyer, which is in place until at least March 2024. Rents cannot rise higher than 3.5%.
In addition, since August 2022, owners of properties with a F and G energy performance rating whose rental contract has been concluded, renewed or tacitly renewed after that date can no longer increase the amount of their rent annually, or to new tenants.
Within areas of housing stress rents are also frozen there are also maximum rents that apply, called l’encadrement des loyers.
The rent on a new tenancy cannot exceed the rent level of the previous tenant. These areas are:
Ajaccio, Annecy, Arles, Bastia, Bayonne, Beauvais, Bordeaux, Draguignan, Fréjus, Genève-Annemasse, Grenoble, La Rochelle, La Teste de Buch-Arcachon, Lille, Lyon, Marseille-Aix-en-Provence, Menton-Monaco, Meaux, Montpellier, Nantes, Nice, Paris, Saint-Nazaire, Sète, Strasbourg, Thonon-les-Bains, Toulon and Toulouse.
From 1st Jan 2024, this list will be substantially extended by over 2,000 additional communes, whose names can be found at Décret n° 2023-822 du 25 août 2023. The councils in these communes will have the right to impose the controls, but many may choose not to do so.
Separately, in some areas maximum rents apply, which vary by location, type and size of property. In exceptional circumstances, it is possible for a property with unique characteristics to exceed the maximum.
In such areas the rent cannot be mechanically increased each year in line with the IRL unless it is below the local reference rent (by type, size and condition of property) set by the government.
In practice the communes who apply this rule are mainly in the Paris region, but there is growing interest by local councils in many other areas of the country to adopt the measure.
The communes are Paris, Lille, Hellemmes, Lomme, Aubervilliers, La Courneuve, Épinay-sur-Seine, L'Île-Saint-Denis, Pierrefitte-sur-Seine, Saint-Denis, Saint-Ouen-sur-Seine, Stains, Villetaneuse., Lyon, Villeurbanne, Bagnolet, Bobigny, Bondy, Le Pré Saint-Gervais, Les Lilas, Montreuil, Noisy-le-Sec, Pantin, Romainville, Montpellier, and Bordeaux. To this list will be added Marseille at the end of 2023, and 24 communes in the inter-communal council of Pays Basque in 2025.
Reports are widespread of landlords in breach of the rule, with a recent investigation carried out by a French television station finding that 40% of rentals they examined were non-compliant, often through the use of a 'complément de loyer' for an allegedly higher specification property.
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