November 2017

Investing in and financing
a new home in 2017

Acquiring property is no longer just a pipe dream for the majority of the French. Institutions help homebuyers to carry out their property acquisitions through various schemes.

Interest-free loans (PTZ)

This scheme is certainly the most widely known to the general public. It is available to means-tested first-time buyers and is known in French as the Prêt à Taux Zéro (PTZ). The loan may finance up to 50% of the total cost of a new home built in France. Its amount depends on the location of the property and the taxable household. The PTZ may not exceed the amount of other loans involving more than two-year terms that are also earmarked to finance the building project.

Home-savings loans (PEL/CEL)

Have you taken out a special Plan Épargne Logement (PEL) or Compte Épargne Logement (CEL) savings account with a French bank over the last several years? That bank will likely offer you a loan at a regulated interest rate. The amount depends on the term of the loan and the interest earned by the account holder over time.  Obtaining this type of financing also renders the individual eligible for a government subsidy, the amount of which is also based on the interest earned over the term of the PEL/CEL, the date when the loan is taken out and the intended use of the loaned amounts.

The prêt action logement housing loan

This loan is reserved to employees in a non-agricultural private company with less than 10 employees, as well as to persons recently retired (less than 5 years) who also worked for the same type of company.  Formerly known as the 1% housing loan, it is intended for those persons who would like to buy (or build) their primary residence subject to RT 2012 requirements.  It is especially known for its preferential interest rate max of 1%.

Other financial assistance in 2017

Other financial assistance for homebuyers may also be available to owners looking to ease their mortgage payments.  They are known as the APL, ALS and ALF. Local authorities also grant low-interest loans, subsidies and premiums.  Finally, note that you will be exempt the first two years following the termination of your home from paying the taxe foncière (property tax) since the building is new.


Every taxpayer who is a tax-resident of France and who acquires a new house between 1 January 2006 and 31 December 2017 is eligible to benefit from the PINEL Law. PINEL investments are eligible for a tax reduction of up to €6000 per year from 9-12 years.

The tax reduction depends on the rental term:

For a term of 6 years’ rental the tax reduction is 12%.
For a term of 9 years’ rental the tax reduction is 18 %.
For a term of 12 years’ rental the tax reduction is 21 %.


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