A week of political chaos has been punctuated by the sound of rent controls, thanks to a parliamentary report signed by MPs Annaïg Le Meur and Iñaki Echaniz.
What does this flash report reveal? That rent control in 72 French local authorities is working, since "all communes are satisfied and are seeing concrete effects". Period.
Never mind that there was no economic impact study to back up these impressions. It doesn't matter that no attempt has been made to compare rent trends with municipalities that do not apply rent controls. It doesn't matter that there are already mechanisms in place to control rents when they are renewed, or to index their progression to the IRL.
As a result, we need to make these rent controls permanent, avoid circumvention strategies such as civil leases, and take care to regulate coliving.
The message for investors is deleterious. Individuals understand that it's better to invest their savings in another product or in another country. Institutional investors are left scratching their heads to find arguments for investing in an asset class that will yield less than the 10-year OAT, and whose return prospects will be captive.
The dogma even seems to spill over into other asset classes. As in the case of retail, where the mayors of Lyon and Bordeaux have written a letter to Prime Minister Sébastien Lecornu in which they call for rent controls in city centers to "save local commerce" threatened by Amazon, Shein or greedy landlords. It's no longer clear who's the cause of what, by the way.
At a time when the level of public debt obviates any leverage for intervention, everything is being done to discourage private investment in real estate. And this will inevitably lead to a drop in supply.
On the contrary, we need to make real estate - France's leading industry, with over 10% of GDP and 2 million jobs - an attractive sector for investors. This can be achieved through a number of levers: taxation, simplification of standards and regulatory stability.
This requires us to stop dividing the debate between supporters of an administered economy and supporters of the invisible hand of the market, and to focus on the real issue: how to create a real estate offer that is adapted to the future needs of the population and the workforce, at a time when demographics are undergoing a major shift and uses are constantly evolving.
A subject so central to our societies... that no politician has really taken it on board.