Between 2014 and 2020, Paris lost 75,000 residents yet the rents are still rising

10 comments

1. >investment funds who build/buy and can afford to sit on an empty apartment blocks

   There’s no indication of this happening.

   https://m.independent.ie/business/irish/irelands-largest-private-landlord-reports-99pc-occupancy-as-demand-soars-42274672.html

2. It’s funny people like to ignore that rents in Dublin dropped by the largest amount in 10 years during Covid when people left and supply increased

   It’s like magnets, they can’t explain it…

3. I’m extremely confused as to the point of this post. The article is about second homes – not investment funds or long-term rental properties?

4. I’d say that rich people buying up apartments in Paris for their once a year visit is a bigger problem than companies buying up properties. Some people have so much money they don’t know what to do with it. To them an apartment in Paris is like a flash new watch or a new handbag.

   The Balearics in Spain are suffering a similar problem. Locals can’t find a place to stay while tons of apartments are empty most of the year. They’re looking to add a residency rule. It would limit property purchases to people who’ve lived there for a period. It will be interesting to see how this law works out for them as it will have EU wide implications.

5. I’d be surprised if they can afford to sit on empty apartment blocks. I remember looking at some of the REIT annual reports a few years ago. They are allowed to borrow max 50% of the value of their assets and they all have. For the larger funds this can be in the 100s of millions. They need regular rental income finance their debt.

   But on the other hand there is a massive incentive for these funds to maintain high rents because the value of their assets is directly linked to how much rent income they can generate. This also effects their access to credit. Say they reduce rent by 10% in order to fill empty units they could wipe 100mill off the value of their business. It might be better to for them to sit on empty units for a while and pray the economy changes. Increasing interest rates isn’t helping them either.

6. I own a place in Paris (primary residence) and from what I know this bill will be unlikely to get passed due to a lack of support.
   Lots of people are leaving the city but simply to move to the subarbs where rent is less, they aren’t moving to other cities. Its worth nothing that Paris is smaller than Dublin and has a definitive fixed size which can’t be increased.

   I have friends who recently relocated but simply to move 1Km south and therefore in a different ‘county’. Still in greater Paris area but not paying the same rates as someone with a Paris address.

7. I mean you don’t really want to get to Paris levels. Buying is about twice as expensive as in Dublin per sqm.

8. The OP’s conclusion and the posted article are saying completely different things. Nowhere does the article blame investment funds for sitting on empty apartment blocks, which is frankly a daft notion.

9. The Shangri-la Hotel just quoted me €11k for 3 nights in August. Now that’s inflation.

10. But it’s surely the immigrants’ fault, somehow!