Reader Question: My daughter moved out of the flat she was renting and I was surprised when the owner said she, rather than the agency or some government rental bond department) had the deposit. Is this normal?
The payment and return of security deposits or rental guarantees (dépôts de garantie) are covered by regulations in France, however, there is no requirement for a renting agency or government scheme to manage it.
Even in cases where a renter has only interacted with a rental agency (and paid the deposit directly to them), the agency sometimes passes the deposit to the landlord.
The agreement between the landlord and the agency will dictate who keeps the deposit. Whichever party is responsible for keeping it is also responsible for paying it back to the tenant when the tenant moves out.
Unlike in some other countries (such as the UK), deposits do not have to be stored in a government-backed deposit protection scheme.
In the event of a tenant opening a legal case over a dispute surrounding the deposit, however, the landlord is always the target of the complaint, even if the tenant has not interacted with the property owner themselves.
How is the deposit paid?
If paid directly to them, or returned to them by a rental agency, the landlord can do whatever they wish with the deposit, including spending or reinvesting the money.
The only requirement is that, in the event of no disagreements during the état des lieux (moving out inventory), the deposit is paid back to the tenant within one month of the keys being returned.
In the case of a dispute over deductions from the deposit, the limit is generally two months. Note that it may be paid back minus any relevant deductions that the landlord can justify, such as unpaid rent or charges, amounts to pay for damage, or for works that the tenant should have carried out but did not.
In most cases the payment (both the initial payment of the deposit and the return) is made via bank transfer.
However, it is possible to pay the deposit with cash, and the tenant can ask the landlord (or agency) for a receipt acknowledging the payment if so. This does not mean that the landlord is obliged to repay the deposit in cash.
What is the maximum amount of a deposit?
Deposits for furnished accommodation can be no more than the equivalent of two months’ rent (excluding rental fees and agency charges if applicable). This can be required to be paid alongside the first month’s payment of rent.
It should be no more than one month’s rent for an unfurnished flat.
The amount of the security deposit cannot be modified during the rent, but also in subsequent contract renewals with the same tenant.