France’s rent controls tighten amid housing crisis
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French lawmakers are debating stricter rent controls as housing shortages worsen, particularly in Paris. For eight years, France has used rent caps in around 70 communities, including Paris, Lyon, and Bordeaux, limiting rent increases on new leases to 20 percent above local reference rates.
The French Senate recently discussed extending these controls indefinitely and further tightening them, a proposal supported by mayors who fear soaring rents without them.
An economic report commissioned by the government found the caps dampened rent increases by two to five percent compared to similar cities, representing around 600 million euros transferred from landlords to tenants. However, the report also noted uneven benefits, with wealthier tenants in Paris benefiting more than low-income households elsewhere. The effectiveness of the controls is hampered by inconsistent oversight and limited data for monitoring compliance.
Experts warn that rent controls discourage investment in rental properties, especially older buildings needing renovation. Data from the portal Seloger shows rental listings in Paris dropped 74 percent from the end of 2020 to the end of 2023. Combined with a 2023 ban on renting out poorly energy-efficient properties, these regulations have lowered rental income and driven some landlords to sell, leave properties vacant, or switch to short-term rentals.
Paris now has the lowest gross rental yield of any major French city, at 4.1 percent.
