How rent caps work in Lyon and Villeurbanne

Since November 1, the two cities have put in place ceilings for rents. This is intended to reduce the current strong rental tension. Explanations.

After Paris (from 2015 to 2017 and again since 2019), Lille* (since 2020) and the cities of Plaine Commune** in Seine-Saint-Denis (since June 2021), Villeurbanne and Lyon have set up the ceiling on rents since November 1.

A tense sector

These two municipalities meet the criteria of high rental tension set by the Elan law. This is, on the one hand, the level of rents (large difference in rents between private housing and social housing and the median level of rent), and on the other hand, the dynamics of construction. "Indeed, Lyon and Villeurbanne present a particularly tense market and concentrate 71% of the private rental stock of the whole of the Metropolis of Lyon", specified a press release from the Rhône prefecture at the end of September.

In 10 years, the metropolis of Lyon has welcomed 150,000 additional inhabitants. "An attractiveness which is not without consequence on the housing market and which has a strong impact on prices and the ability of a large part of the population to access affordable housing in certain sectors of the territory", specifies the metropolis. The median rent calculated by the Local Rent Observatory (OLL) in 2020 was €11.90/m², €12.6 in Lyon and Villeurbanne. For small surfaces, the highest rents can reach €22.60/m2 with a median rent of €15.6/m². In 2020, out of 70,606 requests for social housing, only 7,443 were satisfied.

The accommodations concerned

The rent control system, which is based on data from the OLL for which the urban planning agency of the Lyon metropolitan area was approved in February 2021, concerns for 2 years rental contracts for empty or furnished (including joint tenancies with multiple leases) for use as a main residence or for mixed professional use and main residence subject to the law of July 6, 1989) or in a mobility lease (lease of 1 month to 10 months of a dwelling furniture).

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It applies to leases signed from November 1 for a first rental, a change of tenant, a lease renewal. On the other hand, it does not apply to housing owned or managed by HLM or SEM (mixed economy company) organisations, to Anah (National Housing Agency) approved housing, to housing subject to the law of 1948, seasonal rentals or furnished accommodation in certain serviced residences.

How the device works

Lyon and Villeurbanne have been divided into 4 zones (geographic sectors). The reference rents therefore vary from one area to another and in each area rent variations are also established according to: the geographical area, the type of accommodation (T1, T2, etc.), the year of construction of the accommodation , and whether the accommodation is rented empty or furnished.

The rent framework is based on these references, increased by 20% (increased reference rents) or reduced by 30% (reduced reference rents). The rents applied by lessors can no longer exceed the increased reference rents. But "a rent supplement may be applied if the accommodation has location or comfort characteristics justifying it, in comparison with accommodation of the same category located in the same geographical area. For furnished accommodation, a unit increase per square meter is applied to the reference rent to take into account the difference in rents observed between empty rented accommodation and furnished rented accommodation", specifies the metropolis.

To find out the reference rent, a tenant or landlord can use a calculator: https://demarches.toodego.com/logement/cadre-des-loyers/

Are there any penalties for non-compliance?

If a tenant notices that his rent does not respect the ceiling, he must send a letter with acknowledgment of receipt to his landlord to ask him to comply at least 5 months before the end of the contract. If the owner does not act, the tenant can seize the Departmental Commission of conciliation to carry out a mediation. If an agreement is still not found, the tenant can go to court.

The tenant must also inform the Métropole de Lyon that his rent does not comply with the rent framework, via the address: cadredesloyers@grandlyon.com. The metropolis of Lyon will transmit the report to the State services.

When a lease contract does not comply with the rent ceiling, the prefect may give formal notice to the lessor, within two months, to bring the contract into conformity and to refund the overpaid rents. The metropolis of Lyon specifies: "If this formal notice remains unsuccessful, the Prefect may impose a fine on the lessor, the amount of which may be up to €5,000 for a natural person and €15,000 for a person morality. This decision is substantiated and indicates the means and deadlines for appeal. The pronouncement of the fine does not preclude the tenant from taking action to reduce the rent".

*including Hellemmes and Lomme, two former municipalities now associated with the city of Lille

**Aubervilliers, Épinay-sur-Seine, Île-Saint-Denis, La Courneuve, Pierrefitte-sur-Seine, Saint-Denis, Saint-Ouen-sur-Seine, Stains and Villetaneuse