The Long-Term Impact of Housing Subsidies on the Rental Sector: the French Example

C line Grislain-Letr My and Corentin Trevien

Working papers from Banque de France

Abstract: In many countries, housing subsidies to tenants are one of the main tools for housing policy but have an inflationary impact in the short term. For the first time, by taking the French example, we assess the long-term impact of housing subsidies on price, quantity, and quality in the private rental sector. We show that housing subsidies have a long-term overall upward impact on rents, even for tenants who do not benefit from subsidies. This inflationary impact is accompanied by an increase in quantity; no impact on quality is detected. These effects are heterogeneous. For small dwellings, a few years after the extension of housing subsidies, rents stopped increasing significantly and the quantity of one-room dwellings, including new buildings, increased.

Keywords: Public Policy Evaluation; Social Benefits; Housing Subsidies; Tax Incidence (search for similar items in EconPapers)
JEL-codes: H22 R21 R31 (search for similar items in EconPapers)
Pages: 43 pages
Date: 2022
New Economics Papers: this item is included in nep-eur and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:bfr:banfra:886

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