Developers demand "immediate action" from new Prime Minister to get construction out of crisis

"We've been complaining and warning for three years... It's high time that France wakes up and that we have a Prime Minister who is aware of what's going on," insisted its president, Pascal Boulanger, during a quarterly press briefing, organized before the announcement of Michel Barnier's appointment to Matignon.

"Quarter after quarter, we are sinking inexorably into the crisis," he added, revealing the latest figures from the FPI Observatory.

Reservations for new homes, including individuals and investors, continued to fall in the second quarter of 2024, at -8,3% compared to the second quarter of 2023, reaching 23.150.

Permits issued by local authorities to build collective housing are also still down (-15,1%) at 41.200, far behind the volume reached between 2015 and 2018 (59.600).

On the positive side, construction starts are slightly up (+5,1%). "This is not really a recovery, but the consequence of the acquisitions of CDC Habitat and Action Logement over the past year," Mr. Boulanger, however, tempered.

New housing sales collapsed again (-42,4%), to 13.953, the lowest level for a second quarter observed since 2010.

As a direct consequence, the flow times are lengthening further, to 23 months on average in the second quarter compared to 21,9 in the first.

"When demand picks up again, because it will pick up again, we will have a very significant problem because we will have no supply and a lack of know-how," lamented Pascal Boulanger.

"We are in a crisis that will fuel itself," added Didier Bellier-Ganière, general delegate of the FPI.

New real estate is going through a deep crisis. Construction costs have increased, due to inflation of construction materials and the tightening of environmental requirements, and demand has plummeted, due to unfavorable borrowing conditions and the end of tax breaks favorable to investment.

The FPI particularly deplores the disappearance at the end of the year of the Pinel system, which allows individuals who invest in new or renovated housing to benefit from a reduction in income tax by renting it out.

She is arguing for the maintenance, or even the strengthening, of this tax loophole, which the Court of Auditors nevertheless judges in a report released on Thursday morning to "only imperfectly fulfil" its construction objective.

Illustrative image of the article via Depositphotos.com.