France’s zero‑interest mortgage rules shape property sales and rentals

In France, a prêt à taux zéro (PTZ) must finance a primary residence occupied at least eight months a year for the first six years after disbursement. During this period, renting the property is generally prohibited; doing so can trigger the bank’s demand for immediate full repayment of the PTZ and possible administrative penalties. The law does allow limited exceptions—such as professional relocation, divorce or partnership dissolution, recognized disability, or unemployment longer than one year—where temporary rental is permitted under rent‑cap and tenant‑income limits. After the six‑year window, owners may rent freely, and selling a PTZ‑financed home simply leads the notary to deduct the remaining PTZ balance from the sale price, affecting the seller’s net proceeds.

Separate guidance addresses the use of a prêt‑relais, or bridge loan, to coordinate buying a new home while an existing one is still being sold. Although bridge loans are often viewed as risky credit, they can be viable if borrowers assess repayment capacity, consider alternative financing, and remain aware of potential interest‑rate changes—such as recent hikes by the European Central Bank—that could affect loan costs.