Learn how France’s vacant property tax will rise to 60% of rental value in 2027. Discover who is affected, potential costs, exemptions, and how to comply with the new vacant property tax regulations.
Vacant Property Tax in France Set to Skyrocket: What Owners Need to Know Before 2027
France is gearing up for a major overhaul of its approach to vacant property taxation, a move that is likely to impact thousands of property owners across the country. Starting in 2027, new government reforms will merge and significantly raise the taxes on vacant housing, with maximum rates reaching as high as 60% of the property’s rental value in the most sought-after areas. With the possibility of bills reaching several thousand euros a year, this seismic policy shift aims to encourage owners to make better use of their properties amidst a national housing shortage.
The 2027 Transformation: TLV and THLV Merge Into One
For years, French property owners with unoccupied homes have faced two taxes: the “Taxe sur les Logements Vacants” (TLV) and the “Taxe d’Habitation sur les Logements Vacants” (THLV). Both targeted properties left intentionally unoccupied, but varied in rate and municipal application. In August 2026, a decree established the list of municipalities where these rules apply.
From 2027, these two taxes will be merged into a single, standardized vacant property tax, with the collected revenue being funneled directly into municipal and inter-municipal budgets. The unified approach aims to simplify administration—and, crucially, to empower local authorities to set punitive rates where housing demand is highest.
How High Will the Vacant Property Tax Go?
In High-Demand Areas
- Year 1: The vacant property tax will start at a fixed rate of 17% of the property’s “valeur locative cadastrale” (theoretical rental value).
- Subsequent Years: The rate jumps to 34% annually.
- Optional Increases: Local authorities can ratchet the tax up to 30% in the first year and a whopping 60% from the second year onwards.
- This means a property with an assessed rental value of €12,000 could attract a tax bill of up to €7,200 per annum at the top rate.
In Lower-Demand Areas
- Local authorities may opt to deploy the vacant property tax, but the maximum annual rate is capped at 50%.
- Each council is free to decide whether to implement the tax and at what rate, up to this cap.
Important: These rates only apply to properties vacant for periods specified by law (generally over one or two years, depending on local circumstances).
How Is the Tax Calculated?
The key determinant is the cadastral rental value:
- This is not the actual market rent or the purchase price.
- It’s a theoretical rental income, set by French tax authorities, used as the base for various property-related taxes.
- If the rental value is missing from your tax notice, it can be obtained from the local tax office.
Real Tax Bills in Practice:
| Rental Value | 17% Rate | 34% Rate | 60% Rate | 50% Rate (outside high-demand) |
|---|---|---|---|---|
| €5,000 | €850 | €1,700 | €3,000 | €2,500 |
| €8,000 | €1,360 | €2,720 | €4,800 | €4,000 |
| €12,000 | €2,040 | €4,080 | €7,200 | €6,000 |
As shown, tax bills can quickly escalate, particularly for high-value properties or those left vacant for extended periods.
What Qualifies as a Vacant Property?
The tax is targeted at habitable dwellings that are both unoccupied and unfurnished. A property is only deemed vacant if:
- It is suitable for occupation (not derelict or dangerous).
- It is left unoccupied and unfurnished (or insufficiently furnished for normal use) throughout the qualifying period.
- A furnished property used as a second home is generally exempt from this tax, but may still face the separate “taxe d’habitation sur les résidences secondaires” (second home tax), which some municipalities may also increase.
Key Point: Declaring the correct status of your property on the “Gérer mes biens immobiliers” (Manage my real estate) digital portal at impots.gouv.fr is crucial. False or outdated information could trigger an erroneous tax demand.
How Will the New Tax Be Monitored and Enforced?
The French tax authorities plan to rely heavily on the data provided by owners via the “Manage my real estate” online portal. Each year, you must declare whether your property is:
- Your main home
- A second home
- Rented out (or available for rent)
- Lent to another person free of charge
- Unoccupied
Giving inaccurate information may lead to your property being misclassified—and an incorrect or inflated vacant property tax bill. If you believe the tax is wrongly applied, the burden of proof rests with you to demonstrate the property’s actual use (utility bills, residency proofs, rental agreements, etc.).
Are There Any Exemptions or Ways to Avoid the Tax?
Legal Exemptions
An owner can avoid or reduce the vacant property tax in specific circumstances:
- Genuine Sale or Letting Attempts: If you can prove you tried to sell or rent the property at a market-appropriate price, but with no success.
- Acceptable evidence includes real estate agency reports, copies of property listings, correspondence with prospective buyers/tenants, and a market-consistent asking price. Asking above the market rate may invalidate your claim.
- Major Renovation Works: If the property is uninhabitable due to substantial refurbishment or repair, you can claim exemption.
- Must be evidenced with work estimates, planning permissions, photos, and invoices.
- Recent Occupation: If your property was occupied for more than 90 consecutive days during the reference period, it is not liable for the vacant property tax.
Not Enough to “Put Up for Sale”
Simply listing your property for sale isn’t sufficient. It must be a genuine effort, and your price needs to reflect true market value. Overpricing or lack of evidence of marketing activity will see your claim dismissed.
Wealth Tax Overlap
Beware: For owners also subject to the French real estate wealth tax (IFI), a mismatch between the property’s declared value (for the sale) and its stated worth in tax declarations may prompt cross-inquiry by the authorities.
Second Homes and Furnished Properties: Tax Differences
Not all unoccupied properties are taxed equally:
- Secondary residences (furnished): Not subject to vacant property tax, but may be liable for ramped-up secondary home taxes in many cities.
- Unfurnished, unoccupied dwellings: Directly targeted by the new vacant property tax.
Always update property status on impots.gouv.fr to avoid mistakes.
Why Is France Increasing Its Vacant Property Tax?
The Rationale
French cities struggle with housing shortages, particularly in urban and coastal zones. Many properties are left empty for speculative or inheritance reasons, despite strong rental demand. By making vacancy more expensive, the government hopes to:
- Incentivize owners to rent or sell unused homes.
- Increase market supply, easing price/rent inflation.
- Discourage “speculative vacancies”—properties bought but deliberately left empty.
- Generate additional funds for local housing initiatives.
Municipal Autonomy
The reforms grant municipalities much greater control:
- Cities in crisis zones can dramatically increase their vacant property tax, targeting absentee owners and speculative investors.
- Outside hotspots, councils can choose whether or not to impose the new tax, and at what rate (up to 50%).
This local flexibility ensures the ruling can respond to regional housing needs and market pressures.
Case Study: How Much Could You Pay?
- Jean owns a vacant one-bedroom flat in Paris with a cadastral rental value of €8,000.
- With a 60% vacant property tax, his annual bill will reach €4,800, up from about €1,360 under the old regime.
- Marie inherits an empty country house with a €5,000 rental value in a non-hotspot town.
- Her local authority applies the 50% cap, so she faces an annual charge of €2,500 if she doesn’t rent out or use the property.
- A property needing €30,000 of repairs to be habitable:
- Marie can provide evidence of renovation works (photos, invoices, permits) and claim exemption for the tax year(s) the house is genuinely unrentable.
Practical Steps for Property Owners
1. Check Your Cadastral Rental Value:
Contact your local tax office or check your tax notice to find the assessment used for calculating the vacant property tax.
2. Update Declarations:
- Log into the “Manage my real estate” digital service on impots.gouv.fr.
- Accurately declare your property’s status.
- Update promptly if your situation changes.
3. Prepare Documentation:
- If you’re selling, keep estate agent reports, listings, and correspondence.
- For renovations, retain all work-related paperwork.
- For rental attempts, keep ads, messages with prospective tenants, and evidence of a market-level rent.
4. Don’t Overprice:
Authorities may deem your vacancy intentional if you attempt to sell at well above market price.
5. Don’t Ignore Notices:
If you receive a vacant property tax bill and believe it’s in error, quickly assemble your evidence and submit a formal challenge.
Proactive Steps Essential Before 2027
The coming changes to the vacant property tax in France are dramatic, with the potential for bills running into several thousand euros a year—especially in desirable towns and cities. The measures are clearly designed to free up desperately needed housing stock, but the new regime places significant new burdens (and risks) on property owners.
Act now to audit your property portfolios, understand your exposure, and prepare for 2027:
- Review whether you can sell, rent, or make genuine use of empty properties.
- Gather and organize all necessary documentation.
- Keep all declarations accurate and up to date through official digital channels.
By staying informed and proactive, you can reduce or potentially eliminate your liability, avoid costly surprises, and contribute to addressing France’s ongoing urban housing shortages.
For more news and expert advice on French property taxation, subscribe aesgium news and bookmark this site for updates on the latest regulatory changes.
Need help or clarification? Contact your local tax office or a qualified French property tax advisor to understand your situation and rights under the new regime.
References:
- French Public Finance Directorate: Manage my real estate
- Decree of August 25, 2026 (coming into force in 2027)
- Guidance from French tax professionals and real estate agencies
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