Automatic lease renewal: everything you need to know

When you are a tenant, your situation is governed by a lease—a contract strictly regulated by French law. This document authorizes you to occupy a dwelling or building in exchange for monthly payment. Several types of contracts exist, the main ones being residential, commercial, and professional leases. For a standard residence, the duration is generally 3 years. At the end of this contract, several options are available to you.

You might wonder: "is automatic lease renewal the rule?" It all depends on the nature of the property and the legal framework. The subject can seem complex, which is why the Colonies team is breaking down every essential point for you. Generally, if no action is taken by either party upon expiry, the contract is de facto renewed at no extra cost.

The Standard Situation: Unfurnished Rentals

The majority of leases concern unfurnished rentals, occupied for a fixed term of 3 years. In some specific cases, a landlord may offer a shorter duration (minimum one year) if their personal or professional situation justifies it (such as upcoming retirement). Most of the time, the automatic lease renewal occurs based on the initial contract without requiring a new signature. To clarify the situation, a landlord must submit their request 6 months before the expiry date, while a tenant must give 1 to 3 months' notice.

A landlord can only oppose this renewal for three legitimate reasons:

• The sale of the property.

• The intent to occupy the property (for themselves or a close relative).

• A serious and legitimate motive (non-payment or negligence by the tenant).

Furnished Rentals: Terms and Specifics

A furnished rental has a shorter contract duration compared to an unfurnished one, according to the law of July 6, 1989, revised by more recent measures such as the 2014 Alur Law. For standard furnished housing, the lease is for one year, and the automatic lease renewal occurs via tacit agreement.

The student lease, very common in France, has its own rules: it has a fixed duration of 9 months and does not allow for any automatic lease renewal. In return, young student tenants may receive special state aid such as APL or ALS. Finally, seasonal leases limit occupancy to 90 or 120 days depending on the zone (high-demand areas or large cities), with no possibility of tacit renewal.

Signing a New Contract vs. Tacit Renewal

Quite often, the continuity of your stay relies on an unofficial agreement: this is known as tacit renewal. This means that the automatic lease renewal is not explicitly written into a new deed but results from the continuation of the relationship. This process effectively ends the old lease and creates a new contract, either on the same terms or with modifications. You will typically need to negotiate with the landlord unless they decide to proceed with the renewal on their own.

The landlord must absolutely send you a registered letter to officially end the lease. In the event of a sale, a notice period of 3 months (furnished) or 6 months (unfurnished) is required. If you are kept as a tenant, the rental contract is automatically transferred to the new owner.

Renewal of Commercial and Professional Leases

A commercial lease, with a minimum duration of 9 years, does not expire automatically at the end of the term. The professional must request a renewal 6 months before the deadline. The automatic lease renewal for commercial properties is protective of the business owner: a refusal by the landlord usually triggers the payment of eviction compensation.

For a professional lease (6 years minimum), automatic lease renewal does not exist. An explicit agreement between both parties is necessary, although the restart usually occurs on the same basis as the initial agreement.

Lease Renewal and Rent Increases

When a lease ends and is renewed, the landlord may choose to increase the rent within certain limits. To do this, they rely on the Rent Reference Index (IRL) published quarterly by INSEE. Such an increase can only take place if the rent was clearly underestimated compared to the geographical area, and within legal limits set by the IRL's percentage increase. Don't worry, the law protects you against abusive rent hikes: you can contact the city hall or issue a formal notice to your landlord in case of a breach of duty.