The tenants should not be too difficult to find

Establishing the system of tax exemption for housing rental investment that bears his name, Gilles de Robien, then Minister of equipment, transport and housing, promises, on 3 April 2003, a long-term measure. The law on national commitment to housing (ENL), promulgated on 16 July, the not betrayed. Among its most visible provisions: "Robien" remains in place "refocused. He is Assistant the "popular Borloo", intended to produce more accessible to middle-class rental housing.

This new system is based on the "Besson", set up, in 1999 by Louis Besson, now Mayor of Chambéry, and offers investors offset an interesting tax carrot compelled to cap their rent and to choose tenants whose incomes are also limited. The "refocused Robien" offers a cost a little less interesting, and in some areas, lower than those charged rent ceilings today. "This will be the investor based on profitability it wishes to obtain or its tax rates, choose the"Borloo"or the"refocused Robien"at the time where he will complete his statement of tax and the tenant that he will be chosen," said an adviser to the Minister of employment, social cohesion and housing, Jean-Louis Borloo.

Developers lack back today to assess the effectiveness of these new devices, but they participated in the development of these texts and are confident. "We had anticipated this reform, says Jean-François Gabilla, new President of the Federation of builders developers." It is a good decision, an evolution without revolution that will avoid the excess. The interest to hold together the two systems is to offer a choice between a free market, an attractive heritage investment and a citizen effort rewarded by a very significant tax benefit. So far, we did not found precipitation in sales offices. There will be no effect of boon favouring one or the other plan.

"Investors frightened too of regulation will choose the"refocused Robien", those who want to exempt the maximum go rather to"Borloo", predicted Raymond Leroy-Liberge, the President of the real estate group of Provinces, which has sold some 1,200 housing units in 2005. Almost two thirds of the French enter resource limits. The tenants should not be too difficult to find. Then, it is the Manager verify their creditworthiness, as in any real estate transaction.

Difficult cohabitation

The two schemes should coexist in time, in the same buildings and avoid the "Robien have been described excess." The former measure which peaked the rents to market levels, or even superior to them, is accused of fueled the inflation of the price. This system, unscrupulous promoters have built and sold housing presented as tax products promising to inaccessible returns in the very uncertain rental market cities. The Department, it minimizes these "excess" to a few thousands of housing units, i.e. a small percentage of the approximately 60,000 sold apartments each year under this scheme. These shifts affect perhaps even thousands of investors forced to renounce their tax benefit or find a tenant in the year following the delivery.

At best, they will see their expected profitability decrease and their flawed funding plan. Philippe Dubois, Director of the development of the society of promotion Espacil to the South of Brittany, noted the difficulties encountered by some programmes remained empty on the outskirts of Quimper. His analysis shows a little in the concert of praise: "In view of the construction costs that increase, we will have certainly a two tier system, the"Robien"in inner cities, more expensive and probably with a little higher benefits." Those who will buy more will be in a heritage logic than for the sole purpose to pay less tax. It is on the outskirts of the cities that the "Borloo" will be effective for primo-investors and less affluent tenants.

Jérôme Quentin Mauroy, President of the company to promote Tagerim, goes further: "the rents charged in area C (lowest) condemned de facto real estate development in these areas, because profitability will be too low." This will clean up the market because it is precisely on these sites, on the outskirts of all small towns, found the excesses of the "Robien". "Difficult to advance figures, but the Department table on a rise in progressive load"borloo"and, as early as next year, a division of"depreciable"housing: 25,000"borloo"and still 40,000"Robien. Developers will also a measure to increase the supply in urban renewal areas benefit: in these neighbourhoods, housing sold to purchasers to capped resources will benefit from a reduced rate of VAT at 5.5 and a logically lower price. Sales are expected to increase.

Making land

The Act is in does not these measures for the production of new housing. 112 Articles scan number of other topics and offer new tools to the mayors eager to build new housing in their delegating greater responsibility. "The text may seem complicated, because we wanted any address, but no elected can no longer say that it cannot build." "Those who refuse say by their immobility their lack of political will", summarizes Dominique Braye, Senator of Yvelines and rapporteur of the text before the Assembly.

The task of the mayors should be simplified by multiple devices: the increase in non-built land tax aims at combating land retention and push owners to construct or to separate from their lands to the benefit of persons who intend to do so. It will affect from 1 January 2007 for parcels of less than 1,000 m2 located in urban areas, provided that the municipality vote this measure and the new rate of Council tax. Difficult to assess in advance the effectiveness of this device: on the same model, tax on vacant units established in 1998 did not so far proved its usefulness.

Similarly, individuals transferring their lands to social donors between July 28, 2005 and December 31, 2007 will be exempt of taxes on capital gains. Another decision to the discretion of elected officials: the feasibility of levying a tax of 6.6 to recover some of the potential capital gains generated by the opening of land to urbanization that multiplies its value sometimes tenfold or per cent. For Thierry Repentin, Socialist Senator of Savoie: "the Government reverse the burden of the initiative and no doubt attenuated the effectiveness of this measure." It would have been better that the Act applies to all, unless the mayors decide otherwise.

To combat the shortage of land, the ELN Act also authorizes the State to "proceed with the disposition of lands of its domain private at a price lower than their market value" when these lands are destined for the realization of building programs with social housing, but structures for emergency or permanent sites of the Traveller accommodation also now. This discount can be up to 35, but all services of the State in the same way like it. "The Ministry of defence gets 85 of the proceeds of the sale of his land, says the head of a region rich in military brownfield land public institution." He has no interest to sell off its land.

Finally, to comply with article 55 of the Act solidarity and urban renewal imposing 20 social housing or to increase their supply of social housing, even if they are not the duty, Commons can now impose formally and written quotas in each operation of new construction located in an area specified by the local urban development plan. Indeed, Act provides legal support to a widespread practice initiated in 2001 by the city of Paris, that developers are no risk to counter, lest they be denied their building permit.

A technical measure of importance could bail out funds in local communities: so far, the cities lost revenue from the tax on built land which were exempt social landlords. The State undertakes to pay an average of 400 euros per dwelling (a total of 20 to 30 million euros the first year) to the House social housing programs have received their permits between July 2005 and December 2009. All land and real estate professionals anxiously await orders which detail how to apply these texts. Right, the policies are satisfied. The left, which has voted against, recognizes advances, while regretting the silence of the Act on the adjustment of housing aid and the principle of a habitat for all.