Searching for tenants, guarantees…: habits of owners
The National Agency for Housing Information published a survey in June 2019 on the “ practices and appetites » of owners when renting their property and protecting themselves against the risk of non-payment (1).
This survey was carried out using questionnaires sent from June to September 2018 to more than 2,400 landlord owners who came to consult an ADIL (2).
Although the audience surveyed may not reflect all homeowners (the survey is subtitled ” practices and preferences of lessors who have consulted an ADIL “), its results provide useful information on the habits of owners in terms of searching for and selecting tenants (HAS) as a recourse to a guarantee (B).
Finally, they highlight the unpopularity of a global security system which would deprive owners of the ability to choose their tenant or the amount of the rent (C).
A) Search and selection of tenants
According to the ANIL survey, half of owners are looking for a tenant by posting an ad on the internet (a figure that is increasing).
42% of owners rely on their connections and word of mouth, with this figure reaching almost 50% in high-demand areas.
Only 13% of owners who consult an ADIL use an agency to find a tenant.
The solvency of the candidate tenant is obviously a selection criterion for almost all landlords. However, it is not an imperative criterion for 50% of the landlords questioned. When the tenant does not have a fixed income, the landlord is most often satisfied with providing a deposit (a deposit is for example requested in 66% of rentals to a student).
While real estate agencies are rather strict on solvency criteria, owners renting without an intermediary attach importance to more subjective criteria.
50% of owners thus make the “good impression” produced by the candidate tenant an imperative criterion. The rental contract is certainly a contract intuitive personthat is, a contract concluded in consideration of the person.
More generally, the ANIL notes that the requirements of owners are stricter for the owner of a single rental property than for the owner of several properties, the latter being able, among other things, to “dilute” the risk of non-payment.
B) Use of a guarantee against the risk of non-payment
The survey reveals that two thirds of owners cover the risk of non-payment via a dedicated instrument.
47% of owners use a surety commitment (stable figure).
This success is explained above all by the simplicity of its implementation. The personal guarantee is also designed as an instrument of accountability via the ” social control ” In the words of a retired couple of owners quoted by the survey, ” This forces the tenant to say to himself: be careful, I have my parents behind me. “. Owners also appreciate being able to count on the ” family solidarity ” in case of a hard blow. Let us specify that ” This family solidarity often seems to be understood by landlords as intergenerational solidarity, between parents as guarantors and children as tenants. Indeed, 72% of landlords whose tenant is a student request a guarantor from a natural person, while 24% of landlords housing retired households use this mechanism. “.
Far behind, “unpaid rent” insurance is taken out by 14% of the owners surveyed. Most often, it is taken out on the proposal of a real estate agency (42% of lessors practicing delegated management take out GLI).
During the survey conducted in the summer of 2018, only 3% of owners used the VISALE guarantee. Although its implementation is facilitated, the ANIL emphasizes that the VISALE guarantee is still little known, while the force of habits keeps the use of guarantees at a high level.
A third of the owners surveyed said they rented out a property without providing a guarantee (this figure reaches 40% for owners renting directly and falls to 15% in the case of delegated management). Most often, the owners surveyed gave the reason for this lack of guarantee either because their tenant's “good record” makes a guarantee superfluous – in their view – or because of the added complexity that setting up a guarantee entails, or because it is impossible to take out, for example, an “unpaid rent” guarantee (due to the tenant's failure to meet the required eligibility criteria).
More broadly, owners are reluctant, when faced with certain groups (especially elderly tenants), to demand a guarantee or fear that formalising the risk of non-payment would be ” perceived as distorting the relationship of trust established with the tenant “.
However, guarantee requirements remain high in “tense” areas (only 11% of lessors rent their property without guarantee).
C) Against a security system at the cost of free choice of tenant and rent
ANIL took the opportunity of its survey to gauge the interest of owners in what it calls a ” global security system “. Are owners prepared to benefit from a guarantee against non-payment and damage in exchange for a rent cap and/or the selection of the tenant by a third party, in particular Action Logement?
The results of the investigation are clear. Only one in ten landlords are prepared to give up both the choice of tenant and the choice of a free rent.
Beyond the financial disadvantage of such a global system, the owners seem resolutely attached to the character intuitive person of the rental contract. As mentioned above, the vast majority of owners base their rentals on a relationship of trust.
Frederic Zumbiehl • UNPI Lawyer
(1) “Securing your rental against the risk of non-payment (practices and preferences of lessors who have consulted an ADIL)”, Aline Abauzit, Maxime Chodorge, Clément Pavard, ANIL, June 2019
(2) Departmental Housing Information Agency