01 Jul 2019
Rent control was introduced once again in Paris, aiming to control the increasing cost of living of the French capital. Experts report that rent in European cities have rapidly increased because of low interest rates, the economic growth and as consequence of the huge impact of holiday renting website AirbnB.
Paris initially implemented laws controlling the amount of money that landlords may charge tenants as rent, back in 2015. The law was soon reversed, as a judge stated that it should cover the whole region and not just the capital. Paris mayor, Anne Hidalgo is inclined to see rent controlled and has thus come up with a way to help the middle-class and control the cost of living.
Deputy Paris mayor, Ian Brossat showed how every area in Paris will have a reference rent, and apartments in that area cannot be rented out with a price that is 20% higher than the amount set. This is bound to control the rent, which is assumed to have increased by 50% throughout the past 15 years.
Earlier this year, president of France’s National Real Estate Federation (FNAIM) Jean-Marc Torrollion stated that ‘By controlling rents, the government is creating a climate of distrust with landlords by accusing them of being the evil behind France’s housing (crisis).’ Furthermore, others have questioned how the reference rent will vary according to the different type of properties that are offered in the area.
House price inflation has become a rising problem in European cites and the U.S., which has led people from lower and middle-class families to move away from the city centres.