Legally, it is the landlord’s responsibility to carry out renovation and compliance works in the leased building. Under certain conditions, the law allows the tenant to carry out these works themselves. It is not uncommon for tenants to apply for a loan to expand the bathroom or renovate the fireplace of the house they have been renting for several years. Let’s see how this contractual relationship materializes in practice.
Concept of Tenant Lease
The renovation lease is a modality of the main residence lease. It is a contract whereby, in exchange for the tenant’s commitment to perform certain works, the landlord grants them one or more benefits for a specified period (which can exceed 9 years):
- Either waive the right to terminate the lease;
- Or waive the right to request rent revision;
- Or grant a reduction or waiver of rent;
Nature of the Works
The works referred to by the legislator are of any type except those which, under the law, are the responsibility of the tenant. Generally, this includes renovation works, major repairs, and compliance works on the leased property.
This last scenario will allow the tenant to temporarily inhabit a non-compliant building.
Formalities
An oral agreement is insufficient. The law requires a written agreement between the parties, which can be made at any time during the ongoing lease. It is therefore entirely possible to modify a main residence lease into a renovation lease.
The contract must also stipulate that the tenant undertakes, at their own expense, to carry out specified works in the leased property and set the deadline for the completion of these works. In addition to its duration, the contract must mention the consideration provided by the landlord.
Regarding works to bring the leased property into compliance with basic safety, health, and habitability requirements, the law imposes additional conditions.
These conditions include a precise description of the works, a reasonable deadline for starting the works, and no rent being payable during the agreed duration of the works, provided that this duration cannot be shorter than reasonably necessary to complete them.
Furthermore, the landlord must concede at least one additional commitment besides those mentioned above, usually refraining from terminating the lease.
Finally, at the request of the most diligent party, there will be a joint inspection of the works upon their completion. This way, the landlord can ensure that the agreed works have been properly executed.
Recommendations
Although the formula is attractive for both parties, offering significant benefits for the landlord against free occupation for the tenant, caution is still required.
Firstly, do not forget to take out insurance for works of such magnitude because only your liability may be incurred if necessary.
As it is a lease, the landlord can terminate it at any time, with a 3-month notice, for personal occupation, for example. Therefore, make sure to include a clause that provides for reimbursement of the cost of the works if the lease is terminated within a timeframe coinciding with the completion of the works.
Conversely, if you leave the premises and the works are not completed, you may be liable to compensate the landlord for the value of the unfinished works.
