Paris Airbnb rentals are in the news again with the Loi Le Meur (Meur Law), and it’s a topic of interest to many 56Paris blog readers.
While these short-term online rentals have revolutionized the industry all around the world, our city is pushing back, in an attempt to stop their popularity.
We take a look at the pros and cons – and at what changes are happening with the new law.
A double-edged sword
Since they debuted some 15 years ago, short-term rentals from companies such as Airbnb and Booking.com have changed the way tourists travel and stay in their chosen destination.
Now, instead of just hotels, there’s a whole new world of options. And they’re accessible with a few clicks on a computer – or taps on a cellphone.
At first, they might seem like a good thing. More visitors to a city, all spending more, all contributing to the local economy.
But they come with a major downside – a depleted housing stock for those wanting to stay longer or to work. It’s exacerbated in Paris, where the properties are historic and there is very little new housing constructed annually.
It’s this reason our city is resisting, and trying to stop the rise of Paris Airbnb rentals.
It’s a topic we’ve covered in an earlier blog. But now, more changes are happening.
The upside of Airbnb
First. Let’s start with the positives. What does Airbnb bring to the French economy?
There’s little doubt that short-term rental platforms such as Airbnb are a major economic driver in France, including Paris.
According to a recent study, in 2023 alone these websites accounted for 176 million nights booked in our country. 89% of travelers were European – actually 64% were French.
During these stays, the travelers generated a total of €43 billion in turnover for the French economy.
This amounts to 0.8% of France’s overall GDP.
On average, these travelers spent €99 per day during their stays. With an average stay of five days, that’s around €440 per person, per stay.
In terms of tax, the same travelers generated €4.9 billion in net tax revenue, including around €300 million in tourist tax.
Just Airbnb alone – not counting other rental websites – paid tax of €31.7 million to the city of Paris for the period November 2022 to October 2023.
The same study also suggests that online rentals now take second place for all accommodation bookings in France – this places them after hotels but ahead of camping, which is the third most popular choice.
However, these numbers, though impressive, only tell one side of the story.
And the downsides…
So it’s clear that Airbnb and similar online platforms do generate vast sums of money – for both the national economy and the one locally in Paris.
However, they also raise concerns about housing availability – particularly for people wanting to live and work in the city.
As the popularity and prevalence of Airbnb has grown, many landlords are finding it more profitable to list their apartments on these platforms – earning more money from tourists rather than renting on a longer-term lease.
The current rent control laws (on longer-term leases) prevent landlords from charging market value for their properties, so Airbnb offers a tempting and more lucrative option. And there is also the issue of eviction laws in France, which can be restrictive for the property owner to gain back control of their property.
Airbnb can seem like an easier way to rent, avoiding these issues.
These are just some of the possible reasons which have led to a decrease in the number of rental properties available – exacerbating Paris’ already tight rental market.
With a high demand for housing and a seemingly shrinking supply of long-term rental properties, some residents struggle to find places to live they can afford.
Paris Airbnb rentals Meur Law – what is changing?
The government recently announced plans to shake things up.
Beginning fall 2024, France is introducing even stricter rules for short-term online rentals. But what exactly is changing?
Back in May, the government overwhelmingly voted for the Loi Le Meur (Meur Law).
This aims to address a much-criticized tax loophole – one that benefits online short-term rentals.
The new law reduces tax relief on income from letting a furnished tourist apartment from 50-71% to just 30-50%. A significant reduction.
Increased fines too
The Meur Law also proposes harsher fines for landlords who don’t follow the rules.
Despite the Senate rejecting a proposal to reduce the maximum number of days a primary residence can be rented out from 120 days to 60, substantial penalties will still apply to illegal rentals.
The maximum fines for illegally renting out second homes short-term will double, from €50,000 to €100,000. This 100% increase highlights the seriousness with which the Paris authorities are tackling the issue.
Their hope is that by increasing the financial penalty for flouting the rules, landlords won’t be as keen to make a ‘quick buck’ using these websites.
Even stricter rules proposed – the PLU
Paris is planning to make even more changes to protect its housing stock – and to deter the number of Airbnb rentals.
Known as the Local Urban Plan or ‘PLU’, this proposal will be voted on by the end of 2024.
It suggests banning the creation of any new furnished tourist accommodation for most of the city – from the 1st to the 11th arrondissements (districts) along with the Montmartre area in the 18th.
This would mean no more converting residential or warehouses into homes for short-term rental.
And all districts would be banned from converting office spaces into residential rental properties.
Other major European cities are facing similar problems with their housing stock listed online. But the measures being proposed in Paris are the most restrictive of all.
The government deems this necessary to protect the long-term rental market – and to make sure Paris remains an affordable place for its residents.
Only time will tell whether the plans are confirmed, and what effect they may have on the property market.
Here to help you rent or buy in Paris
At 56Paris, we don’t manage Airbnb rentals. Instead, we offer a portfolio of carefully-selected properties for rent.
To speak to a local property expert in our team about renting or buying, please do contact us.
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Photo: Vincent Rivaud