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Money Matters and Legal / In Law

What Effect Has the ALUR Law Had on those Renting Property in Paris?


A recent survey aimed to gauge the effect of the 2014 ALUR laws on those renting property in Paris. Half of the respondents claim a significant effect on their activity, while one in ten have taken their rental property off the market altogether. 

Lodgis, a specialist agency in Paris, studied the sentiment among landlords renting property in Paris after two years of the ALUR laws being in place. Introduced in 2014, the package of measures includes, amongst other things, rent caps that set a minimum and maximum rent level by arrondissement, and increased regulation of short-term rentals in the capital (Airbnb, etc).

The laws aimed to help tenants access affordable property, in the face of rising rents in Paris. But how have they impacted landlords? The results of the survey indicate mixed feelings, with most (52%) saying that it has had some effect. 37% disagree, saying it has had no effect at all, with the remaining 11% stated that they had stopped all renting activity since the laws were passed.

The 52% have continued to rent their property out despite the effects they report. Of this 52%, almost one in five of them report reduced rental earnings. They also report various measures they have had to take since ALUR in order for them to continue renting property in Paris.

One of these is increased cautiousness: 82% say they are more selective with their tenants. This is because the ALUR laws have made evicting them more complicated, by stipulating that a landlord with tenants whose rents are outstanding must alert Ccapex, an organisation that mediates cases, two months before even filing for expulsion.

Meanwhile, 62% have applied for a complement de loyer, permission to charge a higher rent than the maximum allowed by rent caps. This can be done on the grounds that a property has particular qualities that set it apart from other comparable properties: possessing a great view of a monument or offering a special level of comfort could count.

On the positive side, 43% have reported lower maintenance and refurbishment costs for their property. The ALUR law has helped landlords as well as tenants, by covering portions of energy-saving renovation and refurbishment work.

New ALUR laws for 2017

There are several new laws that were announced as part of the ALUR package that will be phased in this year. One of these will be an obligatory diagnostic test (a DTG) for buildings more than ten years old, which could mean increased energy-saving refurbishment costs for some co-ownerships.

Co-ownerships will also have to be registered, starting with those comprised of over 50 properties. Local authorities will also be given increased powers to undertake construction to increase the number of properties within existing buildings.

image © Wikicommons


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