Private landlords and tenants: who pays what?

Do you practise or are you considering rental property investment? An effective way to build up a property portfolio at lower cost, provided your calculations are sound! Between the owner and their tenant, not all housing-related costs are split according to each person’s wishes. The law sets out in detail the charges – and responsibilities – that you can pass on to your tenant, so don’t get it wrong and follow the guide!

Charges related to a property

Let us begin by clarifying some definitions. Owning a property incurs inherent charges that must be paid by the owner. These may include certain taxes (local property tax or waste collection tax primarily), physical maintenance of the property (and the building where applicable), payment of contractor and supplier bills (energy, water, routine maintenance of common areas and the lift, various repairs, etc.) or the remuneration of the freehold management company where applicable.

Among these charges, some can legitimately be recovered by the owner from their tenant. Known as letting charges, the law of 6 July 1989 groups them into 3 categories:

• services rendered related to the use of the various elements of the rented property;

• routine maintenance expenses and minor repairs on elements of common use of the rented property;

• taxes corresponding to services that the tenant directly enjoys.

The lease must list exhaustively the portion of charges attributable to the tenant. Their amount and precise breakdown must be clearly stated. The owner, for their part, retains the obligation to pay certain expenses more related to the property’s value and overall condition.

The split in practice

Firstly, the tenant has a duty to pay for consumables such as cold water, electricity and gas. Hot water and heating come on top when they are communal. In a house, these expenses are directly contracted and paid by the tenant who therefore does not reimburse the owner.

The next part of letting charges concerns routine maintenance of the common areas of the building (where applicable). This includes cleaning generally outsourced to a cleaning company, lift maintenance, garden maintenance and other services that may be taken out by the freehold owners.

Finally, taxes relating to the smooth day-to-day running of the rental are recoverable from the tenant: street cleaning and waste collection.

The owner, for their part, must pay alone all expenses relating to major maintenance of the building (façade renovation, lift compliance works, roof and chimney maintenance), creation of gardens and other exterior or communal decorations.

Similarly, replacement of communal equipment (door entry system, bins) or equipment related to the property (boiler, water heater, windows, or kitchen equipment if the kitchen is rented fully equipped from the outset) are their responsibility.

Freehold management company fees and other management costs remain entirely their responsibility.

The caretaker’s salary is subject to division: 75% is payable by the tenant if the employee handles communal cleaning and bin management, 40% otherwise.

The tenant’s responsibility

While the owner must rent out a property in good condition and carry out major works or repairs, the tenant’s primary obligation is to occupy the property peacefully and not make significant alterations to it. We mention the notion of responsibility here, because it may generate additional costs for the tenant that are not included in the charges.

They must also maintain it in its original condition, through cleaning activities in particular: walls, floors, exterior areas, etc. The tenant is also responsible for minor internal repairs. This is worth noting as it is the main source of dispute between tenants and landlords regarding the assessment of the tenant’s effectiveness in this matter – with the deposit paid at the move-in at stake.

It should also be noted that the tenant is obliged to take out insurance covering the property against accidents and other letting risks (natural disaster, water damage, fire, burglary, etc.). They will be required to provide proof to the owner, annually if requested.

The financial burden split between an owner and their tenant is defined by law, which makes it possible to take action against the owner if necessary. However, legal ambiguity persists on certain points that regularly give rise to disputes and leave the deposit reimbursement to the owner’s discretion: the condition of walls, for example, or an item that may have been damaged by the tenant or through wear and tear. It is best to choose your tenant carefully, and vice versa!

You should also read: Your property is occupied illegally: what recourses do you have?