Sunday, August 2, 2015

Paris: rent control comes into force – France Soir

candidate Francois Hollande campaign promise in 2012 and Alur key measure of real estate law adopted in March 2014, the rent regulation in Paris came into force on Saturday, August 1.

Desired by tenants and opposed by the owners, this measure should cover 20% of new Parisian tenants. Applicable to the signing of a new lease or a renewal, it aims to limit the rise in rents in the capital (+ 42% in 10 years) or even lower them.

Paris was cut into quarters 80 and 14 zones. For each area, basic rent was fixed by experts, based on the number of rooms and year of construction of the building in particular. The owner may not exceed 120% of the basic rent.

However, he can add additional rent if the apartment has “certain characteristics of location or comfort,” such as a terrace, a garden or a beautiful view of the capital. Conversely, the rent can not be too low, it should not go below 30% of the reference price.

The Alur law, initiated by the former Minister of housing Cécile Duflot, originally anticipated to apply this rent control in 28 “tense areas” in France, but Prime Minister Manuel Valls has decided to put it up for now in Paris, “experimental.”

Other cities can theoretically adopt these measures when they are ready to put in place and the government has given the green light. The city of Grenoble has thus favored the measure of supervision, and the mayor of Lille Martine Aubry got Manuel Valls, after a tug-of-war between them, to be able to apply it in his city.

According to the calculations of the OLAP (Observatory of rents in the Paris area), the rent regulation in Paris could result in a rent decrease of up to 50 euros for third tenants signing a new lease of 50-100 euros for another third, and more than 100 euros for the remaining third.

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