Furnished Lease Agreement

The letting of a furnished dwelling is governed by specific legal rules that differ significantly from those applying to unfurnished lettings. Whether you are a landlord wishing to let your property furnished or a tenant looking for an equipped home, mastery of the contractual framework is essential to secure the letting relationship. The furnished lease agreement is the central legal instrument that organises the rights and obligations of each party, determines the conditions of enjoyment of the property and governs the terms of termination.

Definition and characteristics of a furnished dwelling

Legal criteria for a furnished letting

A dwelling is legally classed as furnished where it is fitted with furniture in sufficient number and quality to allow the tenant to live there normally. This definition, which comes from case law, implies that the dwelling must be delivered with all the equipment necessary for daily life.

Decree No. 2015-981 of 31 July 2015 clarified this requirement by establishing a minimum list of mandatory items. A furnished dwelling must therefore include:

• Bedding including a duvet or blanket
• Window blackout devices in the living rooms and bedrooms
• Hobs, an oven or microwave, a refrigerator and a freezer
• Crockery needed for taking meals
• Kitchen utensils (saucepans, frying pans, cutlery)
• Table and chairs, storage shelving
• Light fittings, a vacuum cleaner, an iron

The absence of one or more of these items may lead to the agreement being reclassified as an unfurnished letting, with the legal consequences that this implies for the landlord.

Distinction from seasonal letting

A furnished letting of a main residence is clearly distinct from a seasonal or short-term letting. The former is the tenant's main home for a minimum term of one year, whereas the latter meets temporary needs for holidays or business travel. This distinction has important consequences for the applicable legal regime and the protection of the tenant.

Applicable legal framework

Ordinary law and special provisions

The furnished lease agreement is governed mainly by Article 1714 of the French Civil Code and by the provisions of Act No. 89-462 of 6 July 1989, amended in particular by the ALUR Act of 24 March 2014. However, certain specific rules apply differently depending on whether the dwelling is furnished or unfurnished.

Article L353-20 of the French Construction and Housing Code provides that "in the event of a furnished sub-letting, the rent may be increased by the rental price of the furniture". This provision illustrates the economic specificity of furnished lettings, where the rental value includes not only the use of the real estate but also that of the furniture.

Protection of the tenant

Contrary to popular belief, the tenant of a furnished dwelling benefits from substantial protection, although less than that of the tenant of an unfurnished dwelling. The ALUR Act considerably strengthened this protection by partly aligning the status of the furnished tenant with that of the tenant of an unfurnished dwelling.

The prefect may thus control rents for furnished lettings in tight-market areas, in the same way as for unfurnished lettings. The rules on the security deposit, service charges and the conditions for rent review also apply, with a few adaptations.

Structure and essential clauses of the agreement

Mandatory particulars

The furnished lease agreement must state:

• The full identity and address of the parties
• The start date and the term of the agreement
• The precise description of the dwelling (surface area, number of rooms, equipment)
• The amount of the rent and charges, and how they are reviewed
• The amount of the security deposit
• The detailed inventory of furniture and equipment

The absence of these particulars may result in the nullity of certain clauses or create presumptions in favour of the tenant.

Contractual term

The minimum term of a furnished lease agreement is one year for a dwelling that is the tenant's main residence. This term may be reduced to nine months where the tenant is a student, provided that this status is established at the time the agreement is signed.

For furnished dwellings that are not the tenant's main residence, the term may be freely set by the parties. This category covers in particular seasonal lettings and tourist furnished accommodation.

Amount and review of the rent

The rent of a furnished dwelling is in principle freely set by the parties, except in areas subject to rent control where ceilings apply. The increase compared with an unfurnished dwelling is justified by the provision of furniture and equipment, but must remain reasonable.

Annual rent review follows the rules of ordinary law by reference to the rent reference index (indice de référence des loyers, IRL) published by INSEE. The landlord may also request a reassessment in the event of a significant improvement in the furniture or equipment.

Security deposit

The security deposit may not exceed two months' rent excluding charges for a furnished dwelling, as against one month for an unfurnished dwelling. This increase is justified by the greater risk of damage to the furniture and equipment.

The landlord has a maximum period of one month after the return of the keys to return the security deposit, less any justified claims. This period may be extended to two months if the exit inventory shows damage.

Reciprocal obligations of the parties

Obligations of the landlord

The landlord of a furnished dwelling must:

Deliver a decent dwelling: The dwelling must meet the decency criteria defined by Decree No. 2002-120 of 30 January 2002, particularly in terms of surface area, sanitary facilities and safety. Article L129-8 of the French Construction and Housing Code requires the landlord to notify the landlord's insurer of the occupation of the dwelling for "furnished lettings". In certain municipalities, letting is also subject to a declaration or an authorisation, presented in our article on the rental permit (permis de louer).

Keep the furniture in good condition: Unlike an unfurnished dwelling, where maintenance falls largely on the tenant, the landlord retains the obligation to maintain and replace faulty furniture, except in the case of deterioration attributable to the tenant.

Respect peaceful enjoyment: This classic obligation takes on a particular dimension in furnished lettings, where the landlord must ensure that all the equipment provided remains functional throughout the term of the letting.

Obligations of the tenant

The tenant undertakes mainly to:

Use the dwelling as a prudent occupier (en bon père de famille): This obligation extends to the furniture and equipment provided. The tenant must use them in accordance with their purpose and promptly report any malfunction.

Pay the rent and charges: The charges may include items specific to furnished lettings, such as maintenance or replacement of household appliances.

Allow the necessary checks: The landlord may periodically check the condition of the furniture, subject to complying with the conditions of access to the dwelling.

Inventory and condition report

Legal importance of the inventory

The inventory of furniture is an essential contractual document which is conclusive evidence of the equipment handed to the tenant. It must be drawn up jointly when the keys are handed over and annexed to the lease agreement.

This inventory must describe each item precisely: make, model, condition, serial number for household appliances. A summary description exposes the landlord to evidential difficulties in the event of a dispute over the condition on return.

Entry and exit condition reports

The condition report is of greater importance in furnished lettings because of the multiplicity of items concerned. It must cover the dwelling itself but also all the furniture and equipment.

The parties have an interest in carrying out a photographic condition report, particularly for valuable items or those showing pre-existing signs of wear. In the event of disagreement, they may call on a bailiff (huissier de justice), the costs then being shared equally. The conduct and evidential value of this report are detailed in our article on the exit condition report by a bailiff.

Termination and end of the agreement

Notice by the tenant

The tenant may give notice at any time with one month's notice, as against three months for an unfurnished dwelling. This shorter period is a counterpart to the lesser protection enjoyed by the furnished tenant.

Notice must be served by registered letter with acknowledgement of receipt, bailiff's document or hand delivery against signature. The effective date runs from receipt of the notification by the landlord.

Notice by the landlord

The landlord may give notice only in exhaustively listed cases: recovery for personal or family occupation, sale of the dwelling, legitimate and serious ground. The notice period is three months, the same as that applying to unfurnished lettings.

The notice procedure must comply with strict formalities, in particular precise indication of the ground and of the applicable legal references. An irregular notice is deemed void and the agreement continues on the previous terms.

Tacit renewal

Failing notice, the agreement is tacitly renewed for a term identical to the initial period. This renewal takes place on the same terms, unless the parties agree to amend certain clauses.

A landlord who wishes to change the terms of the agreement must notify the proposal at least six months before expiry. The tenant then has four months to accept or refuse the proposed changes.

Tax and social security specifics

Tax regime of the landlord

Income from furnished lettings falls under industrial and commercial profits (bénéfices industriels et commerciaux, BIC), unlike unfurnished lettings taxed in the category of property income. This classification has important consequences for the reporting arrangements and the deductible expenses.

The landlord may opt for the micro-BIC regime with a flat-rate allowance of 50% on gross receipts, or for the actual regime allowing deduction of actual expenses and depreciation of the furniture. On the tax and corporate consequences of a furnished letting carried out by a civil company, see our analysis of furnished letting through an SCI (French property holding company).

Social security status

The activity of furnished letting may fall under the social security regime for self-employed workers where it is professional in nature. This classification depends in particular on the amount of annual receipts and the landlord's personal involvement in management.

Disputes and remedies

Jurisdiction

Disputes relating to furnished lease agreements fall within the jurisdiction of the judicial court (tribunal judiciaire), unlike unfurnished lettings, which may be brought before the departmental conciliation commission and then before the district court (tribunal d'instance).

This difference in jurisdiction is explained by the commercial classification of the activity of furnished letting, which falls outside the protective status of the 1989 Act.

Amicable remedies

Before any court action, the parties have an interest in favouring alternative methods of dispute resolution: mediation, conciliation before the mayor or a court conciliator. These procedures often make it possible to find pragmatic and quick solutions.

Instructing a lawyer who focuses on real estate law is recommended in order to assess the chances of success of an action and to negotiate an amicable solution on the best terms.

Frequently asked questions

Is a free furnished lease agreement found on the internet legally valid?

A free furnished lease template may be an acceptable working basis, provided that it is adapted to the specific situation and complies with all mandatory legal provisions. However, these standardised templates do not take into account the particularities of each property or recent developments in case law. It is recommended to have the agreement checked by a real estate law professional before signing, particularly for valuable properties or complex situations.

Can an unfurnished lease be converted into a furnished lease during the term?

This conversion requires the express agreement of the tenant and the signing of an addendum substantially amending the contractual terms. Simply adding furniture is not enough to convert an unfurnished lease automatically into a furnished one. A new inventory must be drawn up, the amount of the rent and security deposit adapted, and the clauses on term and conditions of termination amended. Legally, this operation amounts to entering into a new agreement.

Can the tenant bring their own furniture into a furnished dwelling?

The tenant may generally bring additional personal furniture, unless the agreement provides otherwise. However, the tenant may not replace or remove the furniture provided by the landlord without express authorisation. The contractual inventory is conclusive evidence of the equipment that must be returned at the end of the lease. It is advisable to document in writing any special arrangement concerning the addition or modification of the existing furniture.

What is the difference between a furnished lease agreement template and an unfurnished lease agreement?

A furnished lease agreement template differs from an unfurnished lease agreement on several essential points: the minimum term (one year as against three years), the notice period for termination by the tenant (one month as against three months), the amount of the security deposit (two months as against one month), and the mandatory inclusion of a detailed inventory of furniture. The furnished agreement must also provide for the arrangements for maintenance and replacement of the equipment provided, as well as the specific conditions for rent review including the rental value of the furniture.

Can the landlord enter the dwelling to check the condition of the furniture?

The landlord retains a right of visit to check the condition of the dwelling and the furniture, but this right is exercised under strictly regulated conditions. The landlord must give the tenant reasonable notice (generally 24 hours at least), give reasons for the request, and respect usual visiting hours. These checks may not be too frequent or interfere with the tenant's peaceful enjoyment. In an emergency relating to safety or major repairs, the conditions of access may be relaxed.

How is the rent of a furnished dwelling calculated compared with an unfurnished dwelling?

The rent of a furnished dwelling includes the rental value of the real estate plus remuneration for making the furniture and equipment available. This increase must remain proportionate and may be assessed according to the quality, age and value of the furniture provided. In areas subject to rent control, a maximum supplement is set by regulation. It is recommended to rely on a professional valuation of the furniture to justify the amount of rent requested and avoid disputes.

What happens if the furnished dwelling does not comply with the minimum list of equipment?

The absence of items in the minimum list in Decree No. 2015-981 may lead to the agreement being reclassified as an unfurnished letting, with retroactive application of the corresponding legal regime. This reclassification may lead to repayment of the overpayment of rent and security deposit, and to application of the rules on term and notice specific to unfurnished lettings. The tenant may also require the dwelling to be brought into compliance or request a rent reduction proportionate to the missing items.

Drafting a furnished lease agreement requires particular attention to the specifics of this legal regime. Although free templates may serve as a basis, the need to adapt to the particular circumstances of each letting and the constant evolution of regulation justify seeking legal advice from a practitioner in this field. Before any contractual commitment, have your situation assessed by a real estate law professional who will be able to adapt the agreement to your specific needs and inform you of the latest developments in case law.