The role of the State in the local regulation: the case of tax incentive for rental investment by households in France

L’État dans la régulation locale: le cas des aides fiscales à l’investissement locatif des ménages en France

Pierre Le Brun ()
Additional contact information
Pierre Le Brun: ESPACE - Études des Structures, des Processus d’Adaptation et des Changements de l’Espace - UNS - Université Nice Sophia Antipolis (1965 - 2019) - AU - Avignon Université - AMU - Aix Marseille Université - CNRS - Centre National de la Recherche Scientifique - UniCA - Université Côte d'Azur, AU - Avignon Université

Post-Print from HAL

Abstract: This paper looks into the connections between housing production, public policies and household wealth accumulation. It argues that institutional forms of regulation should be considered through a geographical lens. Relying on the study of place-based rental investment tax subsidies for households in France, the main argument is that despite the decline of Fordism, the central State remains very influential in channeling the rental investments of households to specific geographical areas. While households benefitting from tax subsidies financed around a third of new French multifamily housing during the 2000s, the eligible areas for this scheme have been significantly reduced since 2009. Although this tax incentive is commonly acknowledged as a pillar of housing production regulation, little attention has been paid to its geographical dimension. This paper shows how the progressive reduction of the areas eligible for these schemes has gone hand in hand with an increase in their overall budgetary weight. In 2009, the tax rebate was available throughout the country and cost around 0.59 billion euros. In 2018, only 6.4 % of French municipalities were eligible for the scheme, for a loss in tax revenue of over 2.1 billion euros. The geographical concentration of these subsidies has targeted high demand areas (metropolitan, coastal or cross-border municipalities). Drawing on an examination of grey literature and minutes from National Assembly debates, the paper argues that this geographical targeting stems from the desire of policymakers to protect the profitability of household investments. Finally, it suggests that by constructing rental housing as a low-risk, subsidised investment for households, policymakers are likely to foster the "rentierization" (Christophers, 2019) of the French housing economy.

Keywords: Real estate; Investment; Housing; Public policies; Regulation; Immobilier; Investissement; Logement; Politiques publiques; Régulation (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-ure
Note: View the original document on HAL open archive server: https://hal.science/hal-03774611
References: View complete reference list from CitEc
Citations:

Published in Revue d'économie régionale et urbaine, 2022, 2022/5, pp.827-841. ⟨10.3917/reru.225.0827⟩

Downloads: (external link)
https://hal.science/hal-03774611/document (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03774611

DOI: 10.3917/reru.225.0827

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().