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france 24 France

Paris makes rent cap regulations a reality

© Joseph Bamat, FRANCE 24 | A view of the Eiffel Tower and Paris skyline in June, 2015

Text by FRANCE 24

Latest update : 2015-08-01

Rent control regulations on all new or renewed leases went into effect in the French capital on Saturday as President François Hollande tried to make good on one of his key 2012 campaign promises.

The law seeks to cap rent increases from one lease to the next in the country’s largest cities as part of a sweeping housing reform, known in France by the acronym “ALUR”.

Rent in Paris has soared by 42 percent in the last 10 years, according to official data.

An OpinionWay poll published in June showed that 75 percent of French people supported the price-capping measure, although it has met with harsh criticism from estate agents and landlords.

So far the law is only being enforced in Paris, with the government making the controversial regulation optional in other French cities.

The Paris police prefecture has established a maximum rent – measured in euros per square metre – based on the date of construction and location of residences.

The measure could decrease the rent for around 60,000 dwellings in the capital in the coming years, according to business daily Les Echos. It could also raise rents for around 25,000 homes, the French newspaper added.

Legal fight brewing

Estate agent and landlords' associations have denounced the law, vowing to drag officials that wish to implement it into legal battles.

France’s National Federation of Estate Professionals (FNAIM) said the law “constricted” the housing market and would dissuade potential buyers from investing. It said it could file a suit with France’s Council of State.

Meanwhile, estate agents in Lille have reportedly blocked efforts to apply the law in the northern French city by withholding housing and rent data from authorities.

Local governments need the information to establish the average rent for a dwelling in a city and a pricing scale.

Only two other French cities, La Rochelle and Grenoble, are considering establishing rent controls similar to Paris.

“Housing in France is 50 percent more expensive than in Germany, it is a burden on families and limits their purchasing power" Grenoble Mayor Eric Piolle told France Inter radio this week.

Other European countries, including in Germany, Sweden, the Netherlands and Switzerland already implement similar rent control laws.
 

Date created : 2015-08-01

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