France to impose new high rate of tax on vacant homes

France’s 2026 budget contains a major overhaul on the property taxes charged on vacant homes, allowing for higher rates on homes that sit empty for long periods.

Previously the owners of empty homes were charged either the taxe annuelle sur les logements vacants (TLV) or the taxe d’habitation sur les logements vacants (THLV), depending on where the property was situated.

The 2026 budget streamlines this into a single empty homes tax known as the taxe sur la vacance des locaux d’habitation. 

Here’s how it works;

What is an ’empty’ home?

The property is classed as vacant if it is;

• A dwelling space
• Unfurnished, or furnished in a manner that would not allow someone to live there (e.g., no bed)
• Equipped with basic services such as electricity and running water
• Empty for a certain period (more on that below)

This, therefore, does not affect second homes, even if their owners have not been able to visit for a long time – second-home owners pay a different tax called taxe d’habitation.

What is the vacancy period?

The bill allows for the application of different rules depending on whether the home is in an area with a housing shortage or not.

In areas with a housing shortage, the tax applies if the property has been vacant for at least one year as of January 1st of the tax year. Property tax bills are sent out in the autumn, but are based on the situation of the property on January 1st of that year.

In areas without a housing shortage, local authorities have more discretion over whether to impose the tax, with the usual rule being that the property has been vacant for at least two years on January 1st of the tax year.

Authorities in areas with a housing shortage can also impose higher rates of tax.

The list of ‘housing shortage’ areas will be published by decree at a later date, but is likely to be similar to the list of areas declared zones tendus, where local authorities can impose higher taxes on second homes.

How much will the tax be?

Like all property taxes, the vacant homes tax will be based on the rentable value of the property, which is listed on tax bills as the valeur locative.

This rentable value is then multiplied by a rate fixed by the government – this is the same formula as the one used to calculate the other property taxes (taxe foncière which is paid by all property owners and taxe d’habitation which is paid by second-home owners), but the rates for the vacant homes tax are, in general, higher.

• Basic rate – rentable value multiplied by a tax rate of 17 percent
• Rate charged in the second year of imposition and all subsequent years – 34 percent

Local authorities in areas with a housing shortage can impose a higher rate if they choose, up to the following ceilings;

• Basic rate in areas with a housing shortage – 30 percent
• Subsequent years in areas with a housing shortage – 60 percent

It’s likely that local authorities in areas with a severe housing shortage, such as Paris, will choose a rate at or close to the maximum, as they have already done with the optional extra taxes on second homes.

When does this start?

The changes take effect from 2027.

This won’t, therefore, change the property tax bills that are sent out from September to November this year.

But it will affect property tax bills sent out in the autumn of 2027, with the calculation for whether a home is vacant or not based on the state of the property on January 1st 2027.

Are there any exemptions?

There are three possible exemptions from this tax

• If the property is vacant due to circumstances beyond the owner’s control (for example it has been for sale or for rent, at the market value, but no tenant or buyer can be found)
• If the property has been occupied for at least 90 consecutive days in the previous year
• If the property is owned by a social housing organisation (habitations à loyer modéré or HLM)

In each case, it would be up to the owner to apply for the exemption and supply proof of their right to an exemption.