Cries of alarm have multiplied in recent months. The housing crisis continues to worsen, amplified in 2023 by the rise in interest rates. “We hardly sell anything anymore,” Pascal Boulanger, the president of the Federation of Real Estate Developers, already warned in mid-November. In his general policy declaration, Gabriel Attal formulated several measures, showing his desire to cause a “supply shock”. But the new Prime Minister is on the wrong track, believes the promoters’ representative.
L’Express: The Attal government does not yet have a Minister of Housing, but the Prime Minister has been offensive on the subject. Is “supply shock” the key?
Pascal Boulanger: This is going in the right direction, and it is a good thing to have announced it. Except that this is no longer the subject since November 2022! With the rise in interest rates and the strict criteria set by the High Financial Stability Council (HCSF), we arrive at a situation where an enormous need and non-existent demand coexist. In this context, what is the point of having supply? The real challenge, more than urgent, is to find households who want to buy and who will be financed. The diagnosis is wrong, so treatment will not cure the disease.
Why this blindness?
The government is convinced that the prices of new housing can fall further. This is perhaps true to the tune of a few percent, no more, because we cannot reduce the cost of labor, that of raw materials, or the fees of the architect who produces the same work. Promoters’ margins are low, around 5%, and it is impossible to reduce them, otherwise the banks would no longer give us our financial guarantees.
So what do you recommend?
We made lots of proposals to the Ministry of Ecological Transition, to the Ministry of Housing, to Bercy. Measures that would cost the State nothing, such as loosening HCSF rules. The banks tell us of their wish to lend and judge that the precautionary principle goes too far. Furthermore, the decision was taken to stop Pinel at the end of 2024 when investor demand has already collapsed, so much so that the flow of new properties onto the rental market has dried up. It was not the moment. Bercy does not want to hear about the deduction of loan interest, because this measure would have an immediate cost.
Gabriel Attal also announced that he wanted to speed up the procedures, a good idea?
This concerns preventive architecture, building permit authorizations, etc. Twenty metropolises in tense areas would experiment with it. But it’s easier said than done, there are always sticking points.
It also plans a vast simplification operation. Which rules should be pruned first?
There are so many ! Between the architects of buildings in France who take forever to respond to us, the fire standards for wooden buildings which lead to having to surround them with concrete, the thirty months imposed to complete a building in Pinel, untenable at the moment…
What has been the feedback from FPI members lately?
We warned that there would be damage. The French Building Federation expects 150,000 worker job losses. We anticipate the same among white-collar housing workers: design offices, notaries, surveyors, etc. Every day, I hear about layoffs, job protection plans, bankruptcy filings. Promoters do not replace resignations or retirements, which initially relieves them financially. But they also lose a lot of know-how! Training an operation fitter takes time. These are professions that require legal, technical, negotiation, management, site coordination skills, etc. The day demand picks up again, we will sorely miss these employees.
.