Lhe government proposes to cap the rise in rents at a maximum of 3.5%, for one year, to limit the impact of inflation on tenants. Monday, June 27 at 2:30 p.m., the National Housing Council (CNH), a body bringing together housing stakeholders, is invited to give its opinion on this proposed measure – which the government calls “rent shield” – while the inflation is becoming a central issue for tenants.
A meeting of the Minister of Ecological Transition and Territorial Cohesion, Amélie de Montchalin, is also scheduled for the week with tenant associations, who were asking for a rent freeze. The “rent shield” device will be included in the amending finance bill, to be voted on by Parliament this summer. The government thus ensures that it has chosen “a balanced solution”, taking into account the constraints of owners and those of tenants.
READ ALSOWhich households are most affected by inflation?
A 3.5% increase in APLs
At the same time, the government intends to upgrade the APLs in order to support the tenants who need it the most. These personalized housing aids (APL) should be upgraded from 1is July, also by 3.5%, which for the State budget would represent an additional expenditure of 168 million euros. While the benchmark rent index could reach around 5.5% by the end of the year and be even higher during the first half of 2023, if the measure applied rents could at most increase by 3.5%, for one year.
A source at the Ministry of the Economy argued that this is “a positive measure that does not exist among our neighbours”. This 3.5% increase will be “the maximum that can be applied”, but “a significant part of the owners” will not go up to the ceiling. The government claims to have always ruled out “a pure and simple freeze on rents”, Prime Minister Élisabeth Borne having already said that it was “a false good idea”. He points out that owners are also affected by inflation, with increasing maintenance costs, or when they want to carry out energy renovation work in their homes. “Wanting to freeze rents is a false good idea, because it would seize up all the housing supply”, we insist at Bercy.
READ ALSOGas, inflation… Europeans are preparing for the storm