When housing is not...

The FFB has asked insurers to do as quickly and as best they can. The fact remains that these acts of vandalism come at the worst time, as the sector enters into crisis.

Building situation: beginnings of a crisis

Far from the necessary acceleration mentioned by the recent Pisani-Ferry report, improvement-maintenance landed gradually. The main factor in the post-Covid-19 recovery, the market has been less buoyant for a year and, in the first quarter of 2023, its growth rate fell to 1% per year. This settlement can be read over a large part of the territory.

It is also observed for energy renovation, in non-residential as well as in housing, despite the energy crisis, despite the bans on reassessing rents or renting "thermal sieves", despite the implementation of the Renovation advance loan partly guaranteed by the State. It must be said that the instability of the support systems, MaPrimeRénov', CEE as a tax credit for the renovation of the premises of VSEs-SMEs, has not helped.

In addition, new non-residential has had a less favorable start to the year than expected. Year-on-year over twelve months at the end of May 2023, surface areas started fell by 13,4%. Only Normandy, the former Midi-Pyrénées and the former Alsace retain a small dynamic. In addition, the authorized surfaces are stagnating, with very contrasting movements in territory.

By market segment, the downward trend is spreading. However, mention should be made of the confirmed rebound in public procurement, with administrative building permits posting +5,3% year-on-year over five months to the end of May 2023. The dynamic is even more marked for hotel premises, but this segment weighs only 3% overall.

Faced with the quasi-stabilization of renovation and new non-residential, the violent fall in new housing takes everything, although this market “only” accounts for a large quarter of building turnover. In national trend, the sequence of housing starts, permits, sales is proving to be unstoppable: year-on-year over twelve months at the end of May 2023, housing units started fell by 11%, authorized housing units plunged by 18% and sales in the individual diffuse collapse by more than 35%. As for developers' sales, year-on-year over four quarters at the end of March 2023, they dropped by more than 22%.

Clearly, the inevitable new housing crisis is spreading across the country. Above all, it is the result of a formidable scissor effect between the hardening of the credit market and the sharp rise in land and construction costs, particularly under the effect of regulatory and normative provisions. We are thinking in particular of the rules of the High Council for Financial Stability, the 2020 environmental regulations, or the "Zero net artificialisation", applied in anticipation as a simple "zero artificialisation".

In this context, employment is shrinking. Between the first quarters of 2022 and 2023, it only increased by “more than” 4.400 jobs, including interim full-time equivalent jobs (FTE). In addition, hiring intentions on the horizon of the summer continued to decline for companies with more than ten employees and tipped into negative territory for craftsmen.

As for the situation of companies, the exit from the exceptional regime of the health crisis, then the production cost shocks in 2021-2022 cause a rise in failures. However, they remain contained in the building sector and, cumulatively from January to May 2023 compared to the same period of 2019, are still down by 8,5%. On the other hand, real estate development has already greatly exceeded its 2019 level, at +35,9%, due to the collapse of structures carrying abandoned programs (SCI, SCCV, etc.). To return to construction, by extending the trend of the first five months of 2023, failures would more or less return to their level of 2019, a good year in its time.

Among the reasons for this relative fragility of the sector, the overall stable margins at a fairly low level since mid-2021, therefore well below that of 2019.

Late CNR Housing, the requests of the FFB remain highly topical

The announcements of the Prime Minister in conclusion of the CNR Housing constituted the "reasons for the anger" for the sector. They amplify the crisis in our 2025 scenario “if nothing is done”. The suppression of the new PTZ in zones B2 and C and its refocusing on the only collective elsewhere would lead to a new loss of around 15.000 operations. Only 259.000 housing units would therefore be started in 2025, i.e. -30% over three years and a new historic low since the beginning of the 1980s at least. In addition, the trend slowdown in improvement-maintenance would result in growth limited to at most 1% per year in volume. As a result, building activity would fall by 7% excluding the price effect between 2022 and 2025. Employment would follow with approximately 135.000 job losses (employees and temporary FTEs) in the sector alone.

The crisis seems inevitable, but we can still limit its amplitude and duration. The FFB therefore continues to push its proposals.

For the record and without going into detail, it first asks for a real relaxation of the rules of the HCSF in terms of mortgages and the taking into account of the rest to live. It also considers that a regulatory and normative break is necessary.

Regarding the new, the FFB insistently requests the restoration of the new PTZ in its 2017 format, at 40% everywhere, as well as the revision of its scales and their indexation thereafter. She is still campaigning for the establishment of a RE2020 tax credit on loan interest. Then, it recalls the urgency to redeploy a device at least as powerful as the "Pinel 2022", pending the implementation of the status of the private lessor. It also carries the renewal of aid to mayors builders and wishes a real relaxation of the ZAN, in line with what the Senate proposed. She insists on the necessary reform of the zoning of aid, which dates from 2014.

This support for new buildings, including restructuring, is all the more essential as the RE2020 makes it a real vehicle for ecological transition. As soon as it responds to a real need and sobriety on land is essential, a new construction today constitutes a promise of lasting efficiency, sometimes much more than a renovation. In this respect, the FFB also proposes the study of mechanisms for mobilizing private savings in favor of “green housing”.

In addition, the FFB is asking that the budget of MaPrimeRénov' be increased by one billion euros each year for five years to ensure the deployment of the overall renovation, in one go or in stages. She would like a single application file to be created for MaPrimeRénov' and the CEEs. It also insists on the need to reopen MonAccompagnateurRénov' to qualified building companies. The FFB also calls for the sustainability of the tax credit in favor of the energy renovation of the premises of VSEs and SMEs. Finally, it pushes for the rapid start of the EduRénov plan and is preparing for the implementation of MaPrimeAdapt'.

Of course, all this costs. However, as already indicated, housing is proving to be a very positive contributor to the Nation's finances, amounting to more than 50 billion net deductions from aid according to the Housing Account in 2021 and probably also in 2022. is not irresponsible to accept a slightly lower figure in a crisis phase of the sector.

The positive deviation holds true for the PTZ. According to FFB estimates, after five years, that is to say once the state aid has been paid in full, a new operation with PTZ brings in a net balance of nearly 35.000 euros to the Nation. The figure even reaches 37.000 euros where the distribution of the product appears to be maximum today and tomorrow, threatened: in B2 and C. households in “PTZ income bracket 60”, i.e. the most modest, or operations in zone C, where prices are the lowest.

So beware of the risk of a sprinkler getting wet!