Construction of new housing: the decline slows in October

The construction of new homes is better in October

Building permits and new housing starts, which had declined sharply since early 2018, eased their decline in October. Thus, while the decline in building permits exceeded 10% from June to September, they were 122 400 units in October, a decline of 5.9% year on year. Their decline fell by half in October alone, according to figures from the Ministry of Territorial Cohesion. The rHousing starts also softened to a lesser extent. Their number decreased by 6.5% to 87,500 between August and October, while it decreased by 7.9% between July and September. The situation has particularly improved for building constructions. While building permits dropped by 17% in the 3rd quarter, they are down only 9%. The decline is also slowing for single-detached homes, whose permits are down 6.6% from 10.9% previously.

Elan law: building professionals expectant

While the government has promised to relaunch the offer through its housing bill (Elan law), market players evoke multiple reasons for the current decline in construction. For buildings, the world of social housing points out that the savings requested by the executive, up to 1.5 billion euros per year, do not encourage projects, while the promoters emphasize the reluctance local officials in the run-up to the 2020 elections. Among the homebuilders, it is notably the announcement at the end of 2017 by the government of the reduction of the geographical scope of several property subsidies, such as the zero-interest loan ( PTZ), which is particularly evoked to explain the decline in construction. In any case, the rate ofcancellation of building permits rose sharply for buildings in October, compared to September: it stood at 28.4% against 11.4% in the individual.