The buyer would ideally been informed by a French lawyer in the process of french investment and acquiring properties for sale in France. When buying an investment property in France, you don’t think the tenant could not pay rent. It happens sometimes with rental properties in France (French Alps, riviera, Paris …). The rental income of this French property funds the payment of your mortgage. You have to move quick and efficient. Only a specialized lawyer in France can provide you with this results on the long term.

1. Welcome
To
French Leaseba

4. FRENCH LEASEBACK : TERMINATION OF THE LEASE
WITHOUT DAMAGES (INDEMNITÉ D’ÉVICTION)The (tenant) lessee, is a company specialized in the
management of leaseback properties.
However, the operator writes the lease with bad faith. Because
he pretends to waive in advance his right to damages, if the
the lessor end the contract. (eviction
indemnity/(damages called in French : indemnité d’éviction).
According to the French law, the tenant (lessee) cannot waive
in advance and in the lease his right to an eviction indemnity
in case of non-renewal of the commercial lease.
He can waive this right to damages AFTER signing the
commercial lease.
But in this case, the operator is a pro of this industry. He
waives his right knowing well that this clause has without

6. The buyer of the French leaseback property signed a
leaseback contract with a operating company. However only
the tenant wrote the lease contract. The waiver to an eviction
indemnity could only appear as a decisive element of the deal.
Most importantly, the buyer of the French leaseback would (or
might) not have signed the contract. If their attention had not
been attracted by this financial interest, they might not have
contracted. Indeed, the cost of more than € 13,000 claimed as
compensation for eviction weakened the profitability of the
operation for the owners. The legitimate belief in a waiver of
the lessee continued throughout the lease. They served a
notice without eviction compensation. It was served in
accordance with paragraph 6 of the lease.

10. French leaseback
problemsSince the 80’s and the 90’s, several thousand of owners bought
leaseback property in France. The operating company states the
return profit would be 4 % to 5 % per year. Sometimes the
builder sells himself the real estate.
During the 2000s, the operators marketed the French Leaseback
overseas and especially in the UK and Italy. It was marketed as a
risk-free and high return investment. The leaseback schemes
were aimed to put enough renting properties on the touristic
areas of France. The government and the big leaseback
companies present it as a win-win solutions for operator,
investor and the economy. The leaseback companies lobbied
the MP’s int the French Parliament. A lot of buyers thought they
will be able to have a holiday home in France after 9 years (or at
least 20 years).

13. Tax cuts, vat refund and rental income
The purchaser benefits of a VAT refund, because his deal is funding a new build
in France. The operating companies and/or the construction company doesn’t
has to finance with costly bank loans. The french tax agency does not collect
VAT on these sales. This tax cut comes from the french law voted by the
Parliament. The French government wants to boost the real estate industry.
Construction and tourism are creating a lot of jobs in France. The idea is to put
on the market enough holiday homes and flats to rent for few days or a week.
The leaseback scheme works around an operator, who rents to tourists or
students. The operating company has to paid guaranteed rent. It means the
yearly rent is the same, even if the flat isn’t rented during the low-season. The
leaseback owners are supposed to be paid every year without having to care
about the daily business of the tenant. Tax cuts, vat refund and rental income
are the main reasons for buying a leaseback scheme.

16. Why is there a problem with
French Leasebacks?
Why are so many owners are trying to sale by publishing on
real estate websites specialized in french leaseback resales ?
Many buyers have been misled by the leaseback companies.
The purchasers and future owners think themselves as
consumer. But under the French law, they are more merchant
and professional, regarding the lease (and not the buying of
the real estate). So, the owner is a commercial lessor and the
lessee (tenant) is supposed to be the weak party, like a
consumer ! Yes, it is outrageous ! But why? The buyer of
a French leaseback property signs a commercial lease, when
buying the real estate. The year lease is a commercial lease. It
means that a complicated set of rules applies to this contract.

19. The common expenses and fees of
the managing company are increasing
After 9 years (or 18 years), the
management company raises
the fees and the common
expenses of the real estate
increase. The guaranteed yearly
return is decreasing too.

20. The operator is looking for a
rent drop
A second issues concerns the rent. After
the first lease of 9 years usually, the tenant
can fill a case in court to ask for a new
calculation of the rent. The court will
appoint a judicial/court expert in order to
decide on the proper rent according to the
market of accommodations. The rent will
often decrease. If the yield decrease, the
value of the property sinks. Some owners
regroups. Other try to ask to the European
Union to intervene.

23. For More Information Please
Visite The Below Link
https://frenchrealestatelaw-
traesch.fr/leaseback-indemnite-
eviction/
https://frenchrealestatelaw-
traesch.fr

24. Thank Yo