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Property rental with option to purchase

For many years, organisations that provide social housing offered a scheme known as location-attribution for the benefit of those living in social housing.

The Law of 12 July 1984 replaced this scheme with the location-accession scheme.

  • What is location-accession?

    • Location-accession is a scheme by which a tenant may purchase the home that they rent, when they have rented it for a certain time agreed with the owner when the contract was signed.

    • The property involved may be residential or mixed use, collective or individual, finished or under construction, old or new. Although the scheme is not limited to this sector, it mainly applies to social housings.

  • What does one have to do?

    • Any location-accession contract involves the drafting of a notarised instrument which has to be signed by the owner and the prospective buyer.

    • The deed, which is registered on the land register, stipulates the two distinct phases of the operation:
      - an initial period of use during which time the prospective buyer, who is neither a tenant nor the owner, pays a fee. This fee is made up of two parts: the first part (rental part), which the seller keeps, covers the use of the property; the second part (purchase part), is a down payment towards the purchase of the property. This is returned to the tenant, after the deduction of an indemnity, if the option to purchase is not exercised at the end of the contract or if the contract is terminated.
      - exercise of the option to purchase: at the end of the period of use, the prospective buyer must choose whether to buy the property or not. If they choose to do so, the prospective buyer must pay the balance of the price in order to acquire ownership of the property.

  • Is any assistance available?

    • In order to help people buy their home, a loan scheme was set up in 2004.

    • It is known as the prêt social location accession (PSLA) [loan scheme for those on modest incomes]. State regulated, it provides specific tax assistance. However, it only applies to new property.

  • Find a notaire

    • Find the details in the Directory of Notaires of France.
      The special technical features of locations-accessions require the notaire's expertise and your notaire should be involved from the start of the project.