The most important real estate laws in France

The Hoguet Act governs the exercise of the function of real estate agent

Adopted on 2 January 1970 under the chairmanship of Georges Pompidou, the so-called Hoguet law was adopted in a context where the profession of real estate agent was insufficiently or unregulated. The spirit of this law was therefore to put some order back into the hands of customers.

It is since this law that real estate professionals must display the amount of services provided by their agency. Similarly, the Hoguet Act requires real estate agents to take out civil liability insurance as part of their profession. In addition, they must now have a professional card, as well as keep a register of directories and mandates. Finally, this law regulates the remuneration of the real estate agent

The Alur law, for real estate professionals

The Alur law was promulgated on 26 March 2014, 44 years after the Hoguet law, which it modernizes. Indeed, the Alur law extends the obligations imposed by the latter to condominium associations, which were not concerned by the Hoguet law. In addition, the Alur law introduces an additional constraint for real estate professionals, by obliging them to undergo training in order to be able to practice.

Above all, the historical scope of the Alur law concerns the framework of rents it organizes in Paris and Lille, cities considered by the legislator as "tense areas". However, this experiment will end in 2017. The Alur law also introduces many changes, the most notable of which are the reduction from 3 to 1 month of the notice period for tenants located in these areas, the creation of a mandatory information notice to be given to the tenant or the delivery to the latter of a gas and electricity diagnosis.

The Elan Act, President Macron's emblematic text on real estate

Published in the Official Journal on 24 November 2018, the Elan Act is the reference text for Emmanuel Macron's majority in the real estate sector. The spirit of this law aims to make it easier for vulnerable people to access housing and to facilitate the process of building new housing. Like the Hoguet and Alur laws before it, the Elan law introduces multiple changes regulating the activity of real estate professionals.

These include the generalization of the Visale guarantee to students, the simplification of procedures for requisitioning vacant premises, and the strengthening of sanctions against abusive seasonal rentals such as Airbnb. In addition, this law aims to overhaul the system for allocating social housing, through the generalization of the rating system in large urban areas and greater transparency of the criteria applied by landlords. Finally, President Macron has set himself the rule through this law that no additional constraints should be added for the construction of new buildings, in order to compensate for the lack of housing in certain tense areas.

The Pinel law, a very popular real estate tax exemption system

The particularity of the Pinel law is that it has crossed several political majorities. Initially introduced in the 2015 Finance Act, this scheme was extended in 2018 for a period of three years. In general, and in line with the Duflot scheme it replaces, the Pinel law provides an incentive for households to invest in rental property through a progressive tax exemption system. It applies to housing located in so-called tense areas.

The idea is simple: the longer a household rents its property, the greater the tax reduction. In exchange, the rent of the apartments or houses concerned is capped, and their allocation is subject to resource conditions applied to tenants, in order to give easier access to people who are traditionally excluded. Thus, the Paris conurbation as well as most of the major French cities are concerned by this system. Under this Pinel law, the maximum amount of the tax-exempt investment is limited to €300,000 per year.