It is not just consumer prices that affect the purchasing power of households in France. With inflation reaching 4.8% over one year in April according to INSEE, the amount of rents could further strain the budget of tenants. The rent reference index (IRL), which serves as a tool for rent increases, thus reached 2.48% in the first quarter of 2022. A record since 2009.
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Several associations for the defense of access to housing are therefore asking for this index to be frozen. The Ministry of the Economy is thought to include the measure in the amending finance bill concerning purchasing power, which should be presented to the National Assembly after the legislative elections.
An index used to revalue rents
The index does not measure past rental price increases. It serves as a basis for calculating future changes in the rents of housing – empty or furnished – setting the maximum increases that owners may require during the rental.
The IRL is calculated from the average price change over twelve months, excluding tobacco prices and rents. It thus allows landlords to adjust rents according to inflation. Freezing it would therefore make it possible to contain the rise in rents for the months to come.
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Most leases include a review clause that allows the owner of private sector accommodation to increase the rent once a year, on a date specified in the lease. In the absence of this clause, the rent remains fixed throughout the duration of the lease. For example, for an apartment with a rent of €500 per month, the increase will be limited to 2.48%, or €512.40 in the event of a review, in the first quarter of 2022.
A strong increase
In recent months, inflation has reached records unequaled in France since the mid-1980s: 4.5% in March then 4.8% in April. A gradual increase which makes tenants’ defense associations fear a constant increase in the IRL until the end of the year. Until “more than 5%” fears the association Consumption housing living environment (CLCV), for which the freezing of the IRL proves “essential from July 1st” for a period of one year.
“In 2022, with the end of “whatever the cost” and the war in Ukraine, the situation has worsened further: to the rise in rents are added provisions for charges, whether for heating, maintenance or cleaning services, considers for its part the National Confederation of Housing (CNL) which also calls for the application of the measure.
Proprietor advocates, of course, disagree. According to them, a rent freeze would harm small landlords for whom the rental of real estate constitutes an additional pension and who are already seeing their costs soar, due in particular to the increase in property tax or renovation work. energy renovation.