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What is a progressive exit lease from the 1948 law?

Verified 11 January 2023 - Directorate for Legal and Administrative Information (Prime Minister)

The owner of a dwelling subject to the 1948 law may decide to discontinue this scheme to rent at market price, under certain conditions (depending on the category of the dwelling and the resources of the tenant). He must sign with the tenant one phase-out lease of 1948 act, lasting 8 years. Then, the landlord and the tenant can sign a new lease, with a rent corresponding to the market price.

The accommodation must be classified in Category II B or Category II C.

These categories include good, or even fairly good, accommodation.

The landlord is authorised to make a proposal for a progressive exit lease when the resources of the housed persons exceed a certain amount.

This amount depends on the number of people housed:

General case

1 person

The amount of resources of the person housed must exceed €31,703.

These resources correspond to the taxable net income received during calendar year preceding the proposal.

2 people

The combined resources of the 2 persons housed must exceed €38,688.

These resources represent the total taxable net income received by the lessee and other occupants during calendar year preceding the proposal.

3 people

The accumulated resources of the 3 persons housed must exceed €45,674.

These resources represent the total taxable net income received by the lessee and other occupants during calendar year preceding the proposal.

4+

The accumulated resources of the 4 persons housed must exceed €52,659.

This amount shall be increased by €6,985for each additional person.

These resources represent the total taxable net income received by the lessee and other occupants during calendar year preceding the proposal.

In Ile-de-France

1 person

The amount of resources of the person housed must exceed €42,271.

These resources correspond to the taxable net income received during calendar year preceding the proposal.

2 people

The combined resources of the 2 persons housed must exceed €51,584.

These resources represent the total taxable net income received by the lessee and other occupants during calendar year preceding the proposal.

3 people

The accumulated resources of the 3 persons housed must exceed €60,897.

These resources represent the total taxable net income received by the lessee and other occupants during calendar year preceding the proposal.

4+

The accumulated resources of the 4 persons housed must exceed €70,212.

This amount shall be increased by €9,313 for each additional person.

These resources represent the total taxable net income received by the lessee and other occupants during calendar year preceding the proposal.

Determination of rent

The rent must be determined by reference to the prices usually applied in the neighbourhood, in the last 3 years and for comparable housing.

FYI  

this rent will be phased in. The difference between the old rent and the new rent will be spread over the entire duration of the phase-out lease (8 years).

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Up to 1 million inhabitants

The landlord must rely on a minimum of 3 rental references.

Some references (period of construction of a building, type of accommodation...) can be obtained from the network of local observatories.

FYI  

these references must be mentioned in the proposed progressive exit lease to be sent to the tenant.

Agglomeration of more than one million inhabitants

The landlord must rely on a minimum of 6 rental references.

Some references (period of construction of a building, type of accommodation...) can be obtained from the rent observatory of the Paris city centre (Olap) or network of local observatories.

FYI  

these references must be mentioned in the proposed progressive exit lease to be sent to the tenant.

Submission of proposal by owner

The landlord who wishes to discontinue this plan must send the tenant a proposal for phase-out lease by registered letter with notice of receipt or by deed of the Commissioner of Justice (former act of judicial officer).

The proposed lease should include the following information:

  • Name or name of the owner, his domicile or registered office, and those of his authorised representative, if necessary
  • Effective date and duration of phase-out lease (8 years)
  • Building concerned and its destination
  • Accommodation concerned and, if necessary, enumeration of the facilities and common areas to which the tenant has access
  • Amount of rent, method of payment and annual review rule
  • Amount of security deposit, if required
  • Living area of the dwelling concerned
  • Written reproduction of Article 25 and Articles 28 to 33 of Law 86-1290 of 23 December 1986
  • List of references used to fix the rent (at least 3 or 6 references of rent, depending on the size of the settlement where the dwelling is located)

Tenant Response

Within 2 months of receipt of the proposal for phase-out lease, the tenant can do one of the following:

  • Respond to Owner that resource conditions for a progressive exit lease are not being met. The tenant must then provide the necessary supporting documents.
  • Refuse the proposal of the owner and, if the tenant has done work at his own expense that has substantially improved the comfort or equipment of the accommodation, request their reimbursement
  • Accept the landlord's proposal and, if the tenant has done work at his own expense that has substantially improved the comfort or equipment of the dwelling, ask for their reimbursement

The tenant must send his answer by registered letter with notice of receipt or by deed of the Commissioner of Justice (former judicial officer and judicial auctioneer).

If the tenant chooses not to reply to the landlord, this absence of reply is denying.

Procedure according to the tenant's answer

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In case of agreement

The phase-out lease takes effect 6 months after the date of the proposal sent by the owner, unless otherwise specified.

The new rent does not apply immediately. The increase between the old rent and the new rent is progressive. It must be spread out by the eighth annual, that is to say over 8 years.

The annual review according to theIRL: titleContent may be applied on condition that a clause of the lease so provides.

If the tenant has requested the reimbursement of work, the amount is fixed and the reimbursement made when signing the phase-out lease. Upon request of the owner, the refund may also be staggered during the phase-out lease. If the debt still exists at the end of this lease, the landlord then settles the balance to the tenant.

In case of disagreement or without response from the tenant

Within 3 months of receiving the proposal by the tenant, the landlord or tenant may refer the matter to the Departmental Conciliation Commission. This procedure is not mandatory, the protection litigation judge can be brought directly before the court.

The judge may be seised within 6 months of the owner's proposal.

Warning  

if the case is not referred to the judge within 6 months of the owner's proposal, the dwelling remains subject to the 1948 act.

Who shall I contact

The judge decides on the tenant's and landlord's requests and determines the amount of the new rent.

The progressive exit lease is considered to be subject to the terms and conditions set by the judge.

The new rent will not apply immediately. The increase between the old rent and the new rent is progressive. It must be spread out by the eighth annual, that is to say over 8 years.

The annual review of the amount of rent according to theIRL: titleContent may be applied, provided that a clause of the lease so provides.

At the end of phase-out lease of 8 years, a new lease must be concluded.

This new lease is subject to the law of July 6, 1989.

The rent is fixed freely by the owner, in accordance with statutory provisions.

However, if the tenant who, at the end of the 8-year lease, is over 65 years of age or is disabled, the landlord will not be able to give him leave. And he won't be able to raise the rent when the lease is renewed.

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