Usage of Leaseback Property

I would suggest that they are breaking the rules - in that -  if they are renting out of season then they cannot be offering breakfast etc as there will be no one on the site your lease probably staes its for seasonal rentla ie Easter to Halloween

Operator will often rent a portion of apartments long-term or find tenants for winter lets and also rent to tourists in summer peak July Aug (or Jan-Feb in ski resorts).

The benefit to operator is they don't have to collect 10% TVA or pay TVA on those lets as they are not Residence de Tourisme lets.
An operator will often use another sister company for the non RdT lets so in this case the operator is probably RdT compliant as they just manage tourist for a few weeks in summer but the other company can manage non RdT lets and not charge TVA. Operator paid the long-term rental income by sister company later.

An operator that doseent bother using a sister compant is non RdT compliant. Have a look at their accounts. The operators tax bill should cover 10% TVA on all rent and equivalent of taxe d'habitation paid for owners. So "turnover" = rental-income should at very least be just 10 times amount of tax paid. If "turnover" or rental-income in accounts is 30 40 or more tax paid then you know a large proportion of the rental-income is not "tourist revenue" and generated from winter or longterm rentals.

Some operators tourist revenue may only be a small portion of total rental income especially in resorts which could never attract many tourists due to poor locations etc.

In other words...they are crooks...as we all know!

Agreed crooks, bandits, legalised thieves

I have a question along the same line. Are the so called "Residence de Tourism" solely for tourists? Can they not be rented for longer periods, say by students or anyone for period of 6 months to a year? Or suppose you are an owner and decided to live in  your unit for as long as you like? Does the law prohibit you from doing that? 

Dont think there is any law forcing you to rent to tourists but if you got TVA back as part of leaseback scheme you probably would need to make your apartmenmt available for toiurist rental for some portion of year.
Owmers who are in self-mange setups may have lease with someone to provide required para-hotel facilites for a few weeks in summer but use for personal use for remainder of year.
Operators often rent longterm during off season but they probably should be charging 10% tourist TVA on those rentals as their leases would be under leaseback Residence de Tourisme scheme

I have another question along the same line. I have an apartment which I bought under the Leaseback scheme; it is located in a commercial zone (for tourism?) and was operated by Pierre et Vacances for 9 years. I leased it to a new operator who is the probably the worst in the business. Needless to say, I am getting out after 6 years. So, I have operated it for tourism for 15 years.  Can I now sell it to a buyer who would live on it permanently (not as a tourist) but may occasionally lease it out to students rather than short-term tourists? Does the law require the new owner  to operate it for short term tourism only?  Would the present operator of the Residence have a say in how it will be operated?  Eating facilities will not be needed  since the Residence is surrounded by restaurants, movie houses, etc. Your reply and any advice you can give will be very much appreciated.

• Option 1:

  I'm asking what might be an obvious question:? Is the 2nd operator willing to cancel your lease or have you asked them?If they are willing to cancel lease then you can sell to a new buyer freehold with no lease or contracts attached to your apartment and can then sell at full market value. You  have 5 years left under TVA leaseback scheme so you would have to pay back 5 years or 25% or of original purchase TVA if you cancelled lease and sold. 

• Option 2:

 The new purchaser could buy with the lease in place. However the value he/she would pay is dependent on the rent and conditions they would have to operate under for 5 years or more of lease. The "or more" is important as the 2nd operator is not forced to cancel lease in 5 years so new owner would have to take that into account. This means only specialist buyers would be interested and difficult to sell an apartment with a lease attached through a normal estate agent.Your specific question is down to lease clauses but many apartments in Residence de Tourisme resorts could have winter Oct to June lets and then tourists for summer or visa-versa if a ski resort.There is also the option of cancelling with 2nd operator and getting a smaller operator to provide the para-hotel facilities or doing so yourself in a self-manage to maintain your leaseback setup and avoid TVA repayment. However 2nd operator would need to agree to cancel lease first so you first port of call may be to negotiate with 2nd operator.
In that scenario you ciould keep renting for 5 years and then sell. However generally if 2nd operatror still in resort they are unlikely to agree to such a setup.

I just want to thank Mr Macdara for his reply on 23 September to the question I posted on 22 September. It has been most useful and I appreciate very much his kindness to help.Thank you so much Mr Macdara.  More power to you!

Since the last time I raised the question (see my previous postings in this Discussion) of whether or not I can sell or rent my apartment in a Residence de Tourism  located in a Parisian suburb, the Operator has  issued some of us owners a Conge and released us from our Lease Contract. So, I decided to try and sell it in the open  market.To my surprise my sales agent and myself received a letter from the Mayor's Office of Urbanism informing us that my apartment can be used by SHORT-TERM tourists ONLY. It CANNOT even be occupied by the owner himself permanently or long-term or rented out to students.  We were totally surprised. Is the Mayor's policy correct? What can we do?  We are now looking for a lawyer to help us. Can anyone recommend one? We would greatly appreciate getting some advice and help in locating a lawyer or whoever can help. Thank you very much.

Hi Charlie, 

I am afraid I did receive the same few times. Some time the Town hall accept to change the destination of the residence but sometime refuse to change it in habitation residence. I have numerous examples unfortunately, I have tried to find a way around this at the moment but I have not yet found the loop around. 

If the residence has been built or turned into a tourism / business tourism residence it has received a planning permission from the town hall which has it has part of their town / city planning. 

In order to change the destination of the residence, owners need to vote it in an AGM were 100% of the owners are present or represented. If the change is voted and agreed in the agm, then the Syndicat / trustee needs to apply to the town hall. 

The town hall then give their decision. Some times they ignore it totally and owners do what they want but like yourself, a refusal is often sent. Fines could be important so you have to be very careful. 

I have contacted few solicitors and the institute of tourism residences (https://www.residence-tourisme.org/) whom given me the same information everytime. 

Regards, 

Eddy

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In some examples I have, the town hall are taking actions against the person living in even if they have bought the property to live in. The only option for the owners are then to take legal actions against the Notary whom did not inform them properly. 

For the rental, in this particular case if the town hall is hands on it is impossible to rent seasonal or you could be facing fines up to €5,000. 

Like you said, I have example of owners doing what they want and nothing is happening but they are taking a risk as some others example, owners who were doing it are now facing fines and tax audits (because of course if was not declared either). 

It is a risk. 

Regards, 

Eddy

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