Loi Malraux: investing in heritage property in Paris

The loi Malraux provides a tax reduction of 22 to 30% on the cost of restoration work for heritage buildings located in protected areas. In 2026, with a ceiling of 400,000 euros of eligible works over four years, the maximum reduction reaches 120,000 euros. This scheme, which is not subject to the overall cap on tax benefits, is particularly suited to high-income investors targeting Parisian heritage property.

Introduction

Paris contains an exceptional concentration of listed buildings and protected heritage areas. The Marais, the Ile Saint-Louis, the Quartier Latin, the area around the Grands Boulevards: these historic zones house buildings whose restoration qualifies for the Malraux scheme, one of the most powerful tax incentive mechanisms in French tax law.

Since 2011, our property hunters have regularly identified Malraux-eligible properties during their searches. This guide presents how the scheme works, its eligibility conditions and how it fits into a property investment strategy in Paris in 2026.

Table of contents

• How does the loi Malraux work in 2026?
• Which properties and areas are eligible?
• Which Paris districts are eligible?
• What does a Malraux investment return?
• What rental obligations apply?
• What does a property hunter do on a Malraux project?

How does the loi Malraux work in 2026?

The loi Malraux cuts income tax by 30% of the cost of restoration works in a Site Patrimonial Remarquable covered by a PSMV, and by 22% under a PVAP. The works ceiling is 400,000 euros over four consecutive years, giving a maximum reduction of 120,000 euros, outside the overall cap on tax benefits.

The Malraux scheme grants an income tax reduction calculated on the cost of restoration work for a heritage building located in a protected area. The reduction rate depends on the level of protection:

• 30% for properties in a Site Patrimonial Remarquable (SPR) covered by an approved Plan de Sauvegarde et de Mise en Valeur (PSMV)
• 22% for properties in an SPR covered by an approved Plan de Valorisation de l’Architecture et du Patrimoine (PVAP)

The ceiling for eligible works is set at 400,000 euros over four consecutive years. The maximum tax reduction therefore reaches 120,000 euros (30% of 400,000 euros) over four years, averaging 30,000 euros per year.

A key point: this reduction is not subject to the overall cap on tax benefits of 10,000 euros per year. A taxpayer who already uses tax credits for home help, Pinel investments or other capped schemes can stack the Malraux reduction without limitation. This is what makes Malraux particularly attractive for high earners.

Eligible works include the complete restoration of the building: structural work, roofing, facades, common areas, bringing up to standard, as well as interior fittings if the restoration is comprehensive and supervised by an Architecte des Batiments de France (ABF, or Heritage Architect).

Which properties and areas are eligible for the loi Malraux?

Two criteria stack up: the property must sit in a Site Patrimonial Remarquable, with an approved PSMV for the 30% rate or an approved PVAP for the 22% rate, and the works must amount to a complete restoration of the building, authorised and supervised by an Architecte des Batiments de France. Isolated works, such as refreshing a flat or changing a kitchen, are excluded.

Eligibility for the Malraux scheme rests on two cumulative criteria: the property’s location in a protected area and the nature of the works undertaken.

Eligible areas are the Sites Patrimoniaux Remarquables (SPR), which replaced the former secteurs sauvegardes, ZPPAUP and AVAP designations in 2016. For the 30% rate, the SPR must be covered by an approved or under-review PSMV. For the 22% rate, an approved PVAP suffices.

The nature of the works must correspond to a complete building restoration, declared in the public interest or authorised by the ABF. Isolated works (refreshing a single apartment, changing a kitchen) are not eligible. The restoration must cover the entire building and be carried out under ABF supervision, which typically means a development programme led by a specialised developer.

The property must be acquired in a pre-restoration state or the owner must undertake a comprehensive restoration themselves. In both cases, the works must receive special ABF authorisation.

The impact of the energy performance rating (DPE) should be factored in: a well-executed Malraux restoration significantly improves the building’s energy performance, which enhances value on both the rental market and at resale.

Which Paris districts are eligible for the loi Malraux?

The Marais, in the 3rd and 4th arrondissements, is the most emblematic perimeter: its PSMV, approved in 2013, covers around 160 hectares and qualifies for the maximum 30% rate. The 7th around the Faubourg Saint-Germain, the 5th in the Quartier Latin and the 6th in Saint-Germain-des-Pres also hold eligible properties, with areas under classification in the 9th and 10th.

Paris has one of the largest SPR perimeters in France. The Marais PSMV, approved in 2013 and covering the 3rd and 4th arrondissements, is the most emblematic. It protects approximately 160 hectares of historic urban fabric, housing buildings whose restoration qualifies for the maximum 30% rate.

The 7th arrondissement, with its mansions in the Faubourg Saint-Germain, also offers Malraux opportunities, as does the 5th arrondissement around the Quartier Latin and the 6th arrondissement within the Saint-Germain-des-Pres perimeter.

Beyond the central arrondissements, areas being classified or having their protection plans revised exist in the 9th and 10th arrondissement, notably around the Grands Boulevards and the Canal Saint-Martin.

The Parisian advantage is threefold: a concentration of eligible buildings, strong rental demand that secures the rental obligation, and long-term capital appreciation prospects for restored properties in historic neighbourhoods.

What does a Malraux investment return in Paris?

Overall profitability runs between 3 and 5% a year, combining the tax saving, a gross rental yield of 2.5 to 3.5% and capital appreciation prospects. On a 50 sqm flat in the Marais bought for 350,000 euros with 250,000 euros of works, the 75,000 euro tax reduction brings the net cost down to 525,000 euros for a restored property valued at 600,000 to 650,000 euros.

A Malraux investment in Paris breaks down into two components: the property (acquisition in a pre-restoration state) and the works (restoration under ABF supervision).

Here is a concrete example. A 50 sqm apartment in the Marais, acquired for 350,000 euros (property) with 250,000 euros of eligible works. The Malraux tax reduction amounts to 75,000 euros (30% of 250,000 euros), spread over the years of works payment. The net cost of the operation, after the tax benefit, falls to 525,000 euros for a restored property valued at 600,000 to 650,000 euros on the market.

Financing is generally through a loan, with interest deductible against property income under the actual expenses regime. The mortgage amplifies the tax leverage by simultaneously reducing the property income tax base and generating a tax reduction on the works.

Notary fees apply to the property and the share of works already completed at the time of acquisition. They represent 7 to 8% of this base. Works carried out after acquisition are not subject to transfer duties.

The overall profitability of a Parisian Malraux investment, incorporating the tax saving, rental yield (2.5 to 3.5% gross) and capital appreciation prospects, generally falls between 3 and 5% per year, an attractive level for an investment in Parisian heritage property.

What rental obligations does the loi Malraux impose?

The property must be let unfurnished, as the tenant’s primary residence, for at least 9 years, with the letting starting within 12 months of the completion of works. The rent itself is not capped, unlike under the Pinel or Loc’Avantages schemes, and no income conditions apply to the tenant.

The Malraux tax benefit is conditional on renting out the restored property. The conditions are as follows.

The property must be rented unfurnished as the tenant’s primary residence. Furnished or seasonal rental does not meet this requirement. The minimum rental commitment is 9 years from the start of the rental, which must begin within 12 months of the completion of works.

Unlike the Pinel or Loc’Avantages schemes, the rent is not capped under Malraux. The owner can set a market rent, which is a considerable advantage in Paris where market rents often exceed regulatory caps. A restored two-room apartment in the Marais rents for 1,200 to 1,800 euros per month, with no cap constraint.

The choice of tenant is also unrestricted: no income conditions are imposed, which simplifies management and reduces vacancy risk.

In case of non-compliance with the commitment (resale before 9 years, cessation of rental), the tax authorities reclaim the tax benefit granted, plus late-payment interest. This constraint requires a long-term vision of the investment, consistent with the heritage logic of the Malraux scheme.

What does a property hunter do on a Malraux project?

They bring the dual expertise the scheme demands: knowledge of the Paris heritage market and of the protected perimeters. In practice, they compare the turnkey Malraux programmes of specialised developers, which are simpler, with individual restoration projects, which give better control over costs and outcomes.

Malraux investment in Paris requires dual expertise: knowledge of the heritage property market and mastery of protected area perimeters. Our property hunters identify programmes being marketed and individual restoration opportunities in eligible areas.

The advantage of working with a property hunter in Paris is the ability to compare turnkey Malraux programmes offered by specialised developers with restoration projects led by individual owners. The former offer simplicity, the latter better control over costs and outcomes.

For international clients interested in Malraux investment, our service for investors includes the tax and notarial guidance needed to structure the operation. Our guide to buying in Paris as a foreigner details the administrative specifics.

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Interested in Malraux investment in Paris? Our property hunters identify eligible properties and analyse the profitability of each operation. Contact Home Select for a personalised assessment.