Joint press release of the Chamber of Commerce and the Chamber of Crafts of 13 February 2023

Professional chambers oppose government amendments to the bill amending the law on residential leases.

The Chamber of Commerce and the Chamber of Crafts have just issued a joint opinion on the governmental amendments to the bill n°7642 modifying the amended law of 21 September 2006 on the lease for residential use.

The professional chambers are strongly opposed to these amendments which will have very little positive impact on the evolution of rents.

On the contrary, by imputing from now on a certain number of charges on the owners and especially by sending a set of negative signals to the investors, they estimate that this project could in the long run strongly impact the offer on the rental market, which, in a context of continuous increase of the demand will necessarily lead to rent increases, that is to say contrary to the objectives posted by the bill in question.

The professional chambers believe that the amendments (discounting of the capital invested as of two years of existence of the property, lowering of the maximum rate of return) combined with other reforms such as that of the depreciation for rental properties, tend to considerably reduce the attractiveness of investment in new rental property.

However, the accentuated decrease in the number of new constructions for lack of investors could not only have a negative impact on the supply on the rental market, with the result that rents will increase in the context of an ever stronger demand, but could also lead to a significant decrease in the activity of this sector with the consequence of job losses.

For all these reasons, the professional chambers consider that in the current economic context, taking into account also the rise in interest rates, and in order to maintain a sufficient level of construction both to meet the country's needs and to preserve employment in the real estate sector, it is essential to maintain the attractiveness of investment in rental property.