French finance Act 2025: What Measures Target Airbnb Rentals?

The Finance Act for 2025 has introduced new regulations aimed at better controlling short-term furnished rentals, such as those offered on platforms like Airbnb. These measures, often referred to as the "anti-Airbnb law," respond to a growing demand to rebalance the rental market in high-demand areas, where the rise of short-term rentals has contributed to a shortage of long-term housing. Here is a comprehensive overview of the main provisions and their implications for property owners.

1. Reduction of Tax Benefits

One of the key measures in this law is the reduction of tax benefits for short-term rentals, aiming to limit their financial attractiveness compared to long-term leases.

New Tax Regime

According to information from the Ministry of the Economy, the flat-rate tax deduction under the micro-BIC regime (Industrial and Commercial Profits) has been modified as follows:

• For non-classified tourist accommodations, the deduction is reduced from 50% to 30%, with an annual revenue cap set at 15,000 euros.

• For classified tourist accommodations and bed-and-breakfasts, the deduction is reduced from 71% to 50%, with an increased cap of 77,700 euros.

These changes aim to encourage property owners to reconsider their rental strategies, balancing the financial benefits of short-term rentals with those of traditional leases.

Expected Impact

According to a report by the General Directorate of Public Finances (DGFiP), these tax adjustments could lead to a significant decline in the number of non-classified tourist rentals, while encouraging property owners to meet the official classification criteria to benefit from a more favorable deduction.

2. Mandatory Energy Performance Diagnosis (DPE)

The law now requires property owners of tourist rentals to include an Energy Performance Diagnosis (DPE) in their rental documentation.

Why a DPE?

• Until now, the DPE was mandatory for long-term rentals but excluded from tourist rentals. This measure aligns the obligations between these two types of rentals.

• The goal is also environmental: to incentivize the renovation of energy-inefficient properties.

Consequences for Property Owners

• Properties rated F or G (considered "energy sieves") could be banned from short-term rentals in the future, as is already planned for long-term rentals.

• Compliance could represent a significant cost for owners of older properties.

3. Reduced Maximum Rental Duration

Primary Residences

The law maintains the limit of 120 days per year for renting out a primary residence, but it allows municipalities to reduce this threshold to 90 days in high-demand areas.

Secondary Residences

For secondary residences, property owners must request an authorization for change of use, often linked to compensation measures (see below).

Strengthened Penalties

Rental platforms like Airbnb are also affected. They must verify that listed properties comply with these limits, under penalty of administrative and financial sanctions.

4. Compensation and Change of Use

In major cities like Paris, Lyon, or Bordeaux, where rental pressure is high, compensation and change of use are key tools for regulating tourist rentals.

What Is Compensation?

Compensation requires property owners to convert an equivalent surface area used for tourist rentals into traditional housing. For example:

• In Paris, each square meter dedicated to short-term rentals must be compensated by transforming another space (e.g., offices or shops) into residential housing.

• In some neighborhoods, the rule is stricter: 2 square meters must be compensated for every 1 square meter converted.

Procedures for Change of Use

1. Declaration to the City Hall: Any change of use (from residential to commercial) must be approved by local authorities.

2. Obtaining Authorization: This can be temporary or permanent, often conditional on compensation.

3. Regular Monitoring: Municipalities conduct inspections to ensure compliance with granted authorizations.

Penalties for Non-Compliance

Property owners who fail to meet these obligations may face sanctions, including:

• Fines of up to 50,000 euros.

• A ban on listing the property on rental platforms.

5. Strengthened Local Regulations

Focus on Paris

• Paris is one of the strictest cities. Beyond compensation, authorities actively monitor listings to ensure compliance with maximum rental durations and mandatory registration numbers.

• According to the City of Paris, nearly 300 inspections are conducted each month, with systematic sanctions for non-compliance.

Other Major Cities

• Lyon, Bordeaux, Marseille: These cities have adopted similar rules, including registration requirements and rental duration caps.

• Tourist Areas: Coastal and mountain resorts adapt these rules to their specific contexts, notably to preserve housing access for seasonal workers.

With the provisions introduced by the Finance Act 2025, the French government aims to regain control over the short-term rental market. While these reforms promise to rebalance housing supply, they also raise concerns among property owners and platforms, who will need to adapt their practices to avoid heavy penalties.

For property owners, a precise understanding of tax and regulatory obligations becomes essential. As for travelers, these measures could result in a more limited offer or even higher prices, especially in major cities.

These adjustments mark another step in regulating a booming sector, and further measures could follow if tensions in the rental market persist.

urraient suivre si les tensions sur le marché locatif persistent.