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Short-term rental vs long-term rental: which model should you choose to optimize your real estate investment?
In 2025, rental investment remains a preferred lever for building wealth and generating income. In this context, two main strategies are opposed: short-term rentals (LCD), often implemented via platforms such as Airbnb or Booking, and long-term rentals (LLD), a classic model known for its stability. While short-term rentals are attractive because of their potentially higher profitability, long-term rentals are reassuring because of their ease of management. This article provides you with an in-depth analysis of the two models, their respective advantages and disadvantages, as well as the fiscal and legal implications, in order to help you choose the strategy that best suits your wealth goals.
Profitability: why short-term rentals attract investors
Short-term rentals are mainly characterized by their high profitability potential. Indeed, an accommodation rented by the night can generate much higher income than that of a traditional rental. For example, in a tense or tourist area, an apartment that would be rented 1,000 euros per month for long-term rentals can easily produce between 2,000 and 3,000 euros in monthly turnover in the short term, provided it maintains a good occupancy rate.
This increased profitability is also explained by the price flexibility available to the owner. He can adjust his prices according to the season, local demand or even particular events. This ability to adapt makes it possible to maximize income, which is impossible in long-term rentals, where the rent is regulated and fixed for the entire duration of the lease.
Another significant advantage of short-term rentals is the virtual absence of risks of non-payment. Indeed, travelers pay for their stay before arrival via secure platforms. Conversely, long-term rentals expose you to unpaid bills, with eviction procedures that are often long and complex.
Management: greater involvement in short-term rentals
While short-term rentals offer higher returns, they also require greater involvement. Each departure of a tenant involves cleaning, the rehabilitation of the home, and often a personalized welcome. The logistics are therefore heavier than in the context of a traditional lease, where the property is occupied on an ongoing basis.
However, there is an effective solution to alleviate this burden: call on a specialized concierge. These service providers take care of the entire management of the property (reception, cleaning, maintenance), for an average commission of 20% on the income generated. Thus, the owner can benefit from the profitability of short-term rentals while maintaining time and serenity.
Taxation: the advantages of short and long-term furnished accommodation
Taxation is a major lever in optimizing a real estate investment. On this point, furnished rentals, whether short or long, benefit from a tax framework that is much more advantageous than traditional bare rentals.
In bare long-term rentals, the income received is taxed in the property income category. The owner can deduct certain expenses, but the possibilities for optimization remain limited. The land deficit can only be attributed up to a limit of 10,700 euros per year, and fiscal profitability remains moderate.
Conversely, furnished rentals (whether short or long term) fall under the Industrial and Commercial Benefits regime (BIC). Under the micro-BIC regime, the taxpayer benefits from a flat rate allowance of 50% (or 30% for unclassified furnished tourist accommodation), but cannot deduct any real charge. On the other hand, the real regime allows the deduction of all operating expenses as well as the depreciation of the property and furniture. This possibility of amortizing your property often leads to zero tax results, and therefore to an exemption from tax on rental income for several years. The real LMNP status thus becomes a powerful fiscal tool to optimize net profitability.
Regarding the increase in value on resale, the rules vary. In LMNP, the individual capital gains regime applies, with total exemption from tax after 22 years of ownership and from social security contributions after 30 years. Above all, past amortization is not included in the calculation of capital gain, which is a considerable advantage. In LMP, on the other hand, the capital gain is calculated according to the regime for professionals, with reintegration of depreciation, except in the case of possible exemption after 5 years of activity and if the income remains less than 90,000 euros.
Regulation: the growing impact of the Le Meur law on short-term rentals
The Lemeur law, adopted at the end of 2024, provides a more stringent framework for furnished tourist rentals. In particular, it provides for a reduction in the micro-BIC tax allowance for unclassified furnished apartments, the possibility for municipalities to limit the duration of rental of main residences to 90 days per year, and a strengthened power given to general condominium meetings to prohibit short-term rentals by a two-thirds majority vote.
Faced with these restrictions, some investors are considering alternatives to continue to benefit from the advantageous taxation of furnished apartments without falling within the scope of these constraints. Among these solutions are long-term furnished rentals with a mobility lease (1 to 10 months), the request to classify the accommodation as furnished tourist accommodation to benefit from a 50% discount, or even investment in areas not subject to authorization for change of use.
Conclusion
Short-term rentals have a much higher potential for profitability than long-term rentals, provided that management constraints and the legal framework are well controlled. Thanks to the real LMNP tax regime, it often makes it possible to neutralize taxation for several years, while maximizing income. However, it requires increased vigilance in the face of constantly changing regulations. Long-term rentals, on the other hand, remain more stable, less time-consuming, but less fiscally optimised. The choice between the two will therefore depend on the management capacity, financial objectives and fiscal profile of each investor.
sourcing
In 2025, rental investment remains a preferred lever for building wealth and generating income. In this context, two main strategies are opposed: short-term rentals (LCD), often implemented via platforms such as Airbnb or Booking, and long-term rentals (LLD), a classic model known for its stability. While short-term rentals are attractive because of their potentially higher profitability, long-term rentals are reassuring because of their ease of management. This article provides you with an in-depth analysis of the two models, their respective advantages and disadvantages, as well as the fiscal and legal implications, in order to help you choose the strategy that best suits your wealth goals.
LMNP, LMP, micro-BIC or real: how to optimize the taxation of your furnished rental in 2025?
In 2025, furnished rentals are one of the most popular investments for individuals wishing to build up a wealth while generating income. More flexible and more profitable than bare renting, it allows you to benefit from considerable tax advantages, provided you master the different statuses and tax regimes. Between the status of Non-Professional Furnished Rental Company (LMNP) or Professional (LMP), and micro-BIC or real regimes, the choice of taxation can have a decisive impact on the net profitability of your investment. This article guides you clearly and comprehensively to understand the issues and make the right choices.
LMNP or LMP: two statuses to supervise your activity
The status LMNP (Non-Professional Furnished Rental) is the most frequently used by individuals. It concerns landlords who receive less than 23,000 euros in annual revenue from furnished rentals, or whose income is lower than the other income from the tax household (salaries, BIC, etc.). The LMNP status offers great management flexibility, reduced taxation, and above all the possibility of opting for the real regime in order to benefit from the depreciation of the property.
The status LMP (Professional Furnished Rental Company), for its part, is aimed at lessors whose furnished rental income exceeds 23,000 euros per year and exceeds all other business income. It is therefore a professional activity, which involves more stringent social and fiscal obligations, but opens the way to certain advantages, in particular the possibility of imputing deficits to total income, and under certain conditions, to be exempt from tax on capital gain upon resale.
Micro-BIC or real: choosing the most advantageous tax regime
The Micro-Bic diet is a simplified regime applicable automatically if revenue does not exceed certain thresholds: 77,700 euros for a classic furnished rental, 15,000 euros for unclassified furnished tourist accommodation, and up to 188,700 euros for classified furnished apartments or guest rooms. It provides for a lump-sum reduction on revenue: 50% for classic furnished furniture, 30% for unclassified furniture, and 50% for classified furniture. This regime is simple but not very optimized, as no real load can be deduced.
On the other hand, the Real regime allows you to deduct all real expenses: loan interest, notary fees, notary fees, works, insurance, condominium fees, as well as the depreciation of real estate and furniture. This depreciation greatly reduces, or even eliminates, the tax result, which often makes it possible not to pay taxes for several years. The real regime is particularly suitable for investors with a mortgage or significant expenses.
Social security contributions and deductions: what are the impacts on your income?
In LMNP, net income is subject to social security contributions up to 17.2%. However, you are not liable for URSSAF social security contributions, unless you exercise the activity professionally and are registered as such.
In LMP, the lessor is affiliated to URSSAF and must pay social security contributions on the profit made, at a rate of between 35% and 45%. In return, this income is not subject to social security contributions at 17.2%. It is therefore essential to compare the total social security contributions according to the system chosen.
Real estate capital gains: LMNP or LMP regime?
Until 2024, LMNP investors could depreciate their property each year to reduce their tax base, without these depreciations being reinstated during the resale. This allowed for extremely advantageous taxation, as the capital gain was calculated only on the difference between the sale price and the purchase price, depreciation not taken into account.
Since the 2025 finance law, this fiscal niche has been Deleted. From now on, the amortization applied must be reintegrated into the calculation of capital gain. This means that the tax base is increasing, which leads to an increase in resale taxation. For example, a property purchased 200,000 euros, amortized to the tune of 100,000 euros and sold for 300,000 euros, will be considered for tax purposes as having been acquired 100,000 euros, thus generating a taxable capital gain of 200,000 euros.
In LMP, depreciation had already been reinstated for several years. An exemption is still possible if the lessor has been active for more than 5 years and if his income does not exceed 90,000 euros per year.
VAT and CFE: additional obligations
Furnished rentals are, with some exceptions, not subject to VAT. VAT becomes applicable if the rental company offers at least three para-hotel services: reception, daily cleaning, linen supply, breakfast. In the majority of cases, furnished renters therefore avoid this obligation.
On the other hand, the CFE (Contribution Foncière des Entreprises) is due by all furnished renters, from the first year of activity. The amount varies according to the municipality, but is generally between 200 euros and 800 euros per year.
Conclusion
The 2025 reform marks a turning point for the taxation of furnished rentals. The LMNP status, long considered a tax haven, is seeing its attractiveness reduced due to the reintegration of depreciation into capital gain. However, it is still interesting if the objective is to generate regular income. The choice between LMNP, LMP, micro-BIC or real must be carefully considered, depending on the investment strategy, the volume of expenses and the resale horizon. It is strongly recommended to carry out accurate simulations with a professional to adjust your taxation to your wealth objectives.
Sources:
- impots.gouv.fr - Furnished rental
- service-public.fr - Income from a furnished rental
- jedeclaremonmeuble.com - LMNP/LMP taxation
- PAP - Furnished rental taxation
- Bofip - LMP/LMNP capital gains
- Legalstart - Furnished rental, which tax regime should you choose?
- Journaldelagence.com
- Socic.fr
In 2025, furnished rentals are one of the most popular investments for individuals wishing to build up a wealth while generating income. More flexible and more profitable than bare renting, it allows you to benefit from considerable tax advantages, provided you master the different statuses and tax regimes. Between the status of Non-Professional Furnished Rental Company (LMNP) or Professional (LMP), and micro-BIC or real regimes, the choice of taxation can have a decisive impact on the net profitability of your investment. This article guides you clearly and comprehensively to understand the issues and make the right choices.
Le Meur Law or “Anti-Airbnb Law”: What furnished apartment owners need to know in 2025
La Le Meur law, promulgated on November 19, 2024, aims to strengthen the tools for regulating furnished tourist accommodation at the local level. Faced with the rise of short-term rentals via platforms such as Airbnb, this law introduces measures to regulate this practice and preserve the supply of housing intended for primary residence.
Main provisions of the Le Meur Act:
Mandatory declaration at the town hall
As of January 1, 2025, all owners offering furnished tourist accommodation, whether it is their main or secondary residence, must file a declaration at the town hall. This procedure aims to ensure better traceability of tourist rentals.
Limitation of the rental period of main residences
Municipalities now have the option of reducing the maximum rental period for main residences from 120 days to 90 days per year. This measure allows municipalities to better control the use of housing on their territory.
Restrictive zoning
Municipalities can define areas reserved exclusively for main residences in their local urban plan, thus prohibiting furnished tourist rentals in these areas. This provision is aimed at maintaining permanent habitat in certain urban areas.
Suspension in case of unsanitary conditions
In the event of a finding of unsanitary conditions, the town hall may suspend the authorization to rent the furnished tourist accommodation concerned, thus guaranteeing decent housing conditions for the occupants.
Energy performance requirements
The Energy Performance Diagnosis (DPE) is becoming mandatory for furnished tourist accommodation. Housing classified E, F or G will gradually be banned for tourist rentals, requiring owners to carry out renovations to comply with energy standards.
Tax changes
The law changes the tax allowances for furnished tourist rentals. For classified properties, the allowance increases to 50% with a ceiling of €77,700 in annual rental income. For unclassified goods, the reduction is 30% with a ceiling of €15,000. These new rates will apply to rental income received as of January 1, 2025.
Implications for condominiums
Modification of the condominium regulations
Condominium regulations established after November 21, 2024 must explicitly mention the authorization or prohibition of the rental of furnished tourist accommodation. For previous regulations, the general meeting of co-owners may decide to prohibit this practice by a two-thirds majority, thus simplifying the procedure that previously required unanimity.
Obligation to inform the trustee
Any co-owner or tenant offering their lot as a furnished tourist accommodation must inform the trustee as soon as the rental is the subject of a declaration or registration. This measure reinforces transparency within condominiums.
Distinction with long-term furnished rentals
It is important to note that some restrictions in the Le Meur Law do not apply to long-term furnished rentals. For example, rental period limitations and certain reporting obligations relate specifically to short-term rentals for tourism purposes. In addition, the allowances and revenue ceilings under the micro-BIC regime remain unchanged. Furnished rentals used as a main residence over a long period of time are not subject to these same restrictions.
Penalties for non-compliance
Failure to comply with the obligations imposed by the Le Meur Law may result in sanctions, including administrative fines of up to €5,000 per unit concerned. Controls will be strengthened to ensure compliance with regulations.
Conclusion on the Lemeur Act
The Le Meur Law marks a major turning point in the regulation of furnished tourist rentals in France. Faced with the explosion of short-term rentals via platforms such as Airbnb, the legislator wanted to regain control locally to maintain the balance of real estate markets, especially in tense areas where rental tension deprives residents of accessible housing.
Thanks to this law, local authorities now have reinforced tools: reduction of the maximum rental period, creation of areas reserved for permanent housing, a ban in case of unsanitary conditions, and the possibility for condominiums to prohibit furnished tourist accommodation by a two-thirds majority. At the same time, the advantageous fiscal niche for furnished tourist accommodation is reduced, restoring a certain degree of tax equity between the different types of rentals.
It is important to note that the Le Meur Law does not target long-term furnished rentals, which maintain their current tax regimes and remain unaffected by the new constraints. Owners must therefore clearly distinguish their rental method in order to apply the right regulations and optimize the profitability of their property legally.
For investors, this law implies more rigor but also offers more clarity. By relying on specialized rental management or concierge services, it is possible to remain in compliance while maximizing income. More than ever, the management of furnished tourist accommodation is becoming an activity to be professionalized, and knowledge of fiscal and legal rules is becoming a strategic lever for renting effectively, sustainably... and without surprise.
sourcing
The Le Meur Law, enacted on November 19, 2024, aims to strengthen the tools for regulating furnished tourist accommodation at the local level. Faced with the rise of short-term rentals via platforms such as Airbnb, this law introduces measures to regulate this practice and preserve the supply of housing intended for primary residence.
