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Mortgage woe, Paris fines, church change: 5 French property updates

Our weekly round-up of key news from France’s property market

Our wrap also looks at vital seawalls in Corsica and an attempted bribe at a property development site Pic: sunnychicka / Rosamar / viewimage / V_E / Shutterstock

1: Paris pockets €6.5 million in fines for illegal short-term holiday lets

Paris city hall has revealed the number of fines dished out in the capital for illegal short-term letting of properties on sites such as Airbnb, with authorities raking in €6.5 million since 2021. 

Property owners who do not abide by the French capital’s regulations on short-term letting are fined eye-watering amounts.

In 2021, the fine was €20,000 for breaking the rules, but in 2022 the average penalty given was €31,000. 

After earning around €3.5 million in fines in 2021, another €2.5 million was raised in 2022.

Those renting out properties on a short-term basis seem to be getting the message, however. So far in 2023, only €500,000 in fines have been issued. 

“Fines have increased considerably, and this has a dissuasive effect,” said Ian Brossat, Paris’ deputy mayor, who is also in charge of housing in the city. 

“Ten years ago, when there were offences of this type, judges would hand down fines of €500,” he added. 

There were only 67 offences recorded in the first seven months of 2023, a sharp decline on the 370 from 2022 – although the deputy mayor said a number of fines in 2022 were from older cases delayed by the pandemic. 

“Paris was the first city in France to put in place tools to regulate Airbnb, and we can see that this is beginning to bear fruit,” he said. 

“The state of mind remains to say 'yes' to occasional rentals, to allow property owners to make a bit of extra money during certain events [like the 2024 Olympics],” he said.

“But we don't want professional rentals, the predatory economy, which transforms accommodation into year-round tourist rentals,” he added. 

Read more: Airbnb rip-offs, tax cut to be scrapped?: 5 French property updates

2: Former church converted into low-cost flats 

A former church in the east of France has been transformed to provide 10 units of affordable housing, including four-room apartments suitable for families. 

Néolia, a housing development company, converted the former Sainte-Thérèse de Bethoncourt catholic church in the Doubs department into flats, at the cost of €2 million. 

“The large nave upstairs made it possible to install five duplex apartments with balconies [and] the lower part overlooking the outside became a garden level with four apartments and a terrace,” said Xavier Llamas, territorial development director at the company. 

“The chapel remained, sized to accommodate a two-room apartment,” he added. 

All of the homes are high-tech, too, with heating, blinds, and lighting all controlled remotely via a smartphone application.

There are also two parking spots equipped with charging stations for electric vehicles.

You can watch a video about the flats’ construction on YouTube below.

The church was built in 1953 as a place of worship for the influx of workers coming to work at the Peugeot factory in Sochaux, near the commune of Bethoncourt. 

With dwindling numbers of people attending the church, it was desacralised in 2018 and sold to the property company. 

“We used to attend only a few funerals a year there," said a former parishioner invited to the inauguration. 

She added that she was "happy with the way it has been transformed,” specifically with “the life returning” to the community. 

The properties have ‘average’ rents for their size, location, and energy efficiency standards (an ‘A’ on the Energy Performance Diagnostic scale). 

The largest of the 10 flats – an 82m² four-room apartment – has a monthly rent of €530, with an additional €50 in utilities. 

Read more: Rural France will suffer most from ‘no new-build’ policy, warn mayors

3: Average salary needed for mortgage increases by more than 20% in eight months

Thanks to the spike in mortgage interest rates, the average pre-tax salary to obtain a mortgage has shot up by more than 20% since October 2022. 

A €250,000 mortgage spread over 25 years would see monthly payments of around €1,390 – and required a monthly pre-tax income of €3,973, according to Le Figaro.

This is 20.5% higher than the pre-tax amount needed only nine months ago. 

Furthermore, this figure does not take into account any potential factors of increase such as loans or credit card payments. 

Additional influences such as the security of somebody’s job, their age and health status could also increase the cost of monthly payments. 

Even in cases where a mortgage is spread over a shorter period, there have been increases in the monthly payments required since last year.

For a €250,000 payment spread over 10 years, the required pre-tax salary would be  €7,299, an increase of 9% compared to October last year. 

In the same conditions, the monthly pre-tax salary required for a 15-year mortgage has seen an increase of 13.9% and for a 20-year mortgage an increase of 17.2%. 

The most recent notaire data (covering up to March 2023, but with preliminary information up to July 2023), in May 2023 the number of outstanding home loans increased by only 3.7% (compared to 4.1% the month before). 

This is because fewer new mortgages are being taken out and some old ones are paid off. 

Most mortgages in August 2023 for a 25-year mortgage are at 3.70%, an increase of more than 2% to figures this time last year. 

Read more: New data highlights six key trends in France’s property market

4: Developer accused of offering €50,000 payment to end planning deadlock

A developer whose construction project in the suburbs of Paris was paused after local ecological groups filed appeals against it has been accused of attempting to bribe the group to withdraw it. 

The Joinville Ecologie group had filed appeals against a project in the Joinville-le-Pont area back in November 2022, that they claimed is “too dense” and will destroy an important biodiversity corridor. 

Two appeals – one against the construction of the 1,767m² project and one against the PLU (plan local d'urbanisme, or local urban plan) – were lodged. 

Since the appeals, the project – to build 70 homes alongside a multi-purpose hall and a zone for shops – has been delayed. 

The lawyer of the association claimed the project’s developers were frustrated by the standstill and had offered a €50,000 payment for them to withdraw their complaints. 

The offer of payment to withdraw a complaint, however, is “illegal in the case of an association”, said Marc Pitti-Ferrandi, the association’s lawyer. 

After the offer was denied, the project developers offered other measures to get the environmentalists to pull back their complaints, including certain “environmental concessions”. 

“How will planting trees in Seine-et-Marne help us combat heat islands in Joinville town centre?” said the group’s chairman Michel Laval. 

Mr Pitti-Ferrandi called the town’s PLU – which one of the appeals is against – “incompatible with the Sdrif [overall building plan for the Île-de-France region] because of the excessive amount of built-up land,”

“It must be cancelled,” he added. 

The town’s mayor, Olivier Dosne of the Les Républicains party has defended the town’s PLU, however. 

“We won't be changing this aspect of the town planning scheme, which allows us to modernise public services while preserving our local finances,” he said. 

He also added that he would be willing to discuss the matter again with the ecological group before the appeals proceed. 

Read more: Do all property extensions in France require an architect?

5: Homeowners build a 171-metre seawall after storms damaged their houses

A group of homeowners in Corsica pooled together their resources to build a seawall to protect their homes, after experiencing violent storms that damaged their houses. 

After storm Adrian hit the village of Ville-di-Pietrabugno in Corsica hard in 2018, 86 residents banded together to entirely self-fund the construction of a seawall that would prevent sea flooding (submersion marine) in the town. 

“I can still remember the sound of the waves crashing against the bay window,” said Marie-Thérèse, one of the residents who has contributed to the structure. 

The 171-metre-long wall stretches around all of the properties along the coast and cost the homeowners €1.8 million to build.

“We couldn't wait any longer. Since the residence was built in 1976, the coastline has receded by around fifteen metres according to topographical surveys,” said Didier Albertini, property manager of the agency that manages the condominium where the seawall was built. 

“The risks have therefore increased for the buildings and residents, particularly those living on the ground floor, who are the most exposed to these high-intensity [storms],” he added. 

The seawall prevents the encroaching of the sea due to coastal erosion and also provides a barrier from waves during violent storms. 

“We would have ended up with our feet in the water [if we did not build it],” said Jérôme Brasseur, former chairman of the building's union council. 

Alongside finding the funding, residents had to make a number of feasibility studies and administrative requests to build the wall. 

It took four years for the request to construct the wall to be granted, and it will be fully completed in spring of next year. 

According to the Ministry of Ecological Transition, over 50,000 homes in France will be affected by coastal erosion by 2100, and will see the risk of being flooded greatly increased.

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Britons no longer the biggest group of foreign homebuyers in France

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