> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
1
HOUSING AIDS
AND SUBSIDIES
IN FRANCE
—
February 2017
www.logement.gouv.fr
CONTENTS
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
2
GENERAL FRAMEWORK
An introduction to French housing policy
03
Glossary05
Financial aids at a glance
06
01. SOCIAL RENTAL AND INTERMEDIARY HOUSING
Rental loans for integration (PLAI) and for social needs (PLUS)08
Loans for social rental housing (PLS)08
Facts and figures for PLAI, PLUS and PLS09
Upgrading and renovation of social rental housing (PALULOS and PAM) 09
Intermediary rental loan (PLI) 10
Incentives for intermediary rental housing construction by institutional investors
10
02. HOME OWNERSHIP
Zero-rate loan (PTZ - prêt à taux zéro)
Regulated loan (PC - prêt conventionné)
Social rental-ownership loan (PSLA) Reduced VAT rate in urban renewal areas (zone ANRU)
12
13
14
14
03. AIDS AND SUBSIDIES FOR ENERGY EFFICIENCY
Zero-rate eco-loan
Tax credit for energy transition (CITE)
Eco-loan for social housing
Other aids and subsidies for energy efficiency
16
16
17
17
04. INVESTMENT IN PROPERTY FOR RENTAL PURPOSES
“Pinel” support scheme for investment in intermediary rental housing
“Cosse” support scheme for improvements to intermediary rental housing
19
19
05. PERSONAL HOUSING AIDS
Introduction to personal housing aids in France
Personal housing aids today
Family Housing Allowance (ALF)
Social Housing Allowance (ALS)
Personalised Housing Aid (APL)
NOTE : this leaflet does not include a presentation of aids and subsidies that are
speficic to France’s overseas regions and départements. It does not include
those aids and subsidies specific to the National Agency for Urban Renewal
(ANRU), nor those specific to the National Agency for Housing (Anah), to local
authorities or to Action Logement.
21
21
22
22
22
The beginnings of public housing policy in France
The French governement’s involvement in housing policy can be traced
back to the middle of the 19th century, with the first laws defining
minimal hygiene conditions and entrusting city councils with the
responsibility of demanding improvements from private owners. It is not,
however, until the turn of the 19th century and the beginning of the
20th that efforts really take off. The 1894 Siegfried law creates the first
local low-cost housing committees, with the State providing only tax
incentives at first, and direct subsidies and loans from the Caisse des
dépôts et consignations1 from 1906 onward (Strauss law). Around the
same time, the Ribot law (1908) implements a scheme destined to
help less fortunate households in the purchase of a small property on
which to build - a measure primarily aimed at counterweighing the
growing rural flight, but which is effectively the ancestor of today’s
property acquisition schemes. In 1912, under pressure from newly
formed tenants’ unions, the first public offices for low-cost housing are
created in cities and départements.
In the 1920s and 1930s, governements and citizens become
increasingly aware of the dire situation of the housing market, but
several attempted measures (among which a 1928 pledge to build
200 000 dwellings over 5 years) prove unsuccessful or insufficient.
After World War II, the demand for housing massively outweighs the
supply, not only due to the 1.5 million dwellings lost or damaged in the
fighting. A 1945 ordonnance2 introduces a tax on rents designed to
constitute a “national fund for the improvement and maintenance of
rural and urban housing”, the ancestor to today’s “Anah”, the national
housing agency. In 1948, the law establishes limitations on rent
increases for pre-1948 buildings, seeking to ensure that rents do not
rise faster than the ressources of tenants.
From the 1950s and 1960s on, public involvement in the construction
effort grows rapidly, with a particular focus on the developpement of
public housing.
ACTION LOGEMENT
1953 sees the implementation of a compulsory contribution
from companies to the building effort, to the amount of 1% of
the total wage bill for companies employing more than
10 people. This contribution (called “PEEC” or “1% logement”)
brings in additional ressources for the creation of social
housing.
Today, this contribution is 0,45% of the wage bill, but retains
the colloquial name of “1% logement”, even though it is now
officially known as “Action Logement”.
In practice, the contribution is collected and managed by
interprofessionnal committees (CIL - comités interprofessionnels du logement), which are made up of representatives of
employers and employees, and need to receive an agreement,
under an umbrella organisation called UESL (Union des
Entreprises et des Salariés pour le Logement - union of companies and workers for housing).
For 2015, Action Logement has invested a total of over
4,1 billion euros into housing, divided between construction
(1,4 billion), social intervention (0,8 billion) and financing of
public policies (1,2 billion).
In 1957, the “ZUP” (prioritary areas of urbanisation) are created, in a
first effort to integrate both the construction of housing and the
development of necessary infrastructures into one policy. The same law
also plans the construction of 300 000 units per year. Effectively, new
constructions increase from 70 000 completed in 1948 to 320 000 in
1958.
At the same time, the necessity of renewing old buildings, including in
city centres, becomes apparent, launching the policy that culminates
today with the urban renewal plans implemented by the ANRU
(National Agency for Urban Renewal).
© GERARD CROSSAY/TERRA
In addition to the building effort for new housing, French housing policy
also gradually espouses the objective of ensuring that households can
finance their existing dwelling through personal housing allowances.
Three different schemes (ALF, ALS and APL) are successively created,
respectively in 1948, 1972 and 1977. Today, they combine to a
universal policy of personal housing allowances, which are meanstested, and help 6.5 million households manage either their rent
payments or their mortgages.
1. CDC, public savings and investment bank
2. Special regulation adopted by the executive
in a domain normally reserved for statute law
> HOUSING AIDS AND SUBSIDIES IN FRANCE
AN INTRODUCTION
TO FRENCH HOUSING POLICY
—
FEBRUARY 2017
3
GENERAL FRAMEWORK
4
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
GENERAL FRAMEWORK
Zoning
THE LIVRET A
The Livret A is a regulated savings account with a preferential
interest rate set by the government, a deposit limit, and tax-free
annual returns. First created in 1898 to pay back the debts of
the Napoleonic wars, its use was gradually shifted toward the
financing of social housing, beginning with the 1894 Siegfried
law (see above), which alloted 20% of the Livret A funds to this
purpose - today, this share has increased to about 90%.
Since 2009, the account can be offered by any bank, with 60%
of the deposited sums being centralised in a special fund
managed by the Caisse des dépôts et consignations.
The Livret A is immensely popular, as over 90% of French
residents hold an account, for a total of over 230 billion euros
(end of 2014), even though the interest rate has since 2015
dropped to a historical low of 0,75%.
Thus, the Livret A remains one of the cornerstones of French
housing policy, an instrument to convert small private savings
(deposits are capped at a maximum of 22 950 euros) into
long-term investment loans for social housing.
In order for housing policy to be better suited to local conditions, many
policies are implemented depending on set geographical zones with
different characteristics. The two most important systems are the “I/II/III”
zoning, and the “A/B/C” zoning:
I/II/III (1978)
Purpose and criteria :
Used for calculating personal housing aids, and for
determining rent ceilings for social housing (PLAI and PLUS).
Mainly based on demographical criteria.
Facts and figures
Partnership between central and local government.
While, on principle, the responsibility for housing policies lies with the
central government, housing policies have always operated on the
basis of shared responsibility between central and local authorities.
Local authorities are responsible for urban planning, especially for
determining what land is available for construction. Since 2004, local
authorities (such as cities, associations of cities, or départements) can
be entrusted with the managing and distribution of residential housing
subsidies by delegation from the state.
There are 28.8 million primary residences in France this number grows by an annual average of around 1%. France is
characterised by a relatively equal distribution between homeowners
(57,7% in 2015) and tenants, who are again rather evenly split
between the social sector (17.6%) and the private sector (21.8%).
Percentage of individual housing: 57% (78% of which
in urban units)
Average number of people per household: 2.3 (2.7 in the 1980s)
Average surface area of accommodation: 85 sqm
The total housing expenditure (including construction, other
investments, rents, and all expenses) is 470 billion euros (in 2013) about 22% of GDP.
Public housing aids (including all subsidies and tax advantages) amount to over 40 billion euros, or about 2% of GDP.
Housing is the main component of household spendings (21.9%
in 2013, 17.4% in 1984)
A/B/C (2003)
Purpose and criteria :
Describes “tension” of the housing market, where A is more
and C is less tense.
Used for rental investment schemes, property acquisitions
schemes (PTZ, PSLA), and to determine the rent ceilings for
PLS and PLI.
Action Logement :
Intermediary housing :
refers to a system whereby employers contribute to the construction
effort in order to provide housing for their employees. Formerly known
as 1% logement because the contribution started as 1% of the wage
bill, and Participation des employeurs à l’effort de construction (PEEC) - employer’s participation in the construction effort.
For more, see page 3.
Intermediary housing (logement intermédiaire) is an intermediary
form of housing intended for households whose ressources are too
high for social housing yet too low for the open market. Rents are
capped at 15-20% under normal market prices.
refers to the three personal housing aids (APL, ALF and ALS), which
help means-tested households pay their rent or mortgage. See also
page 20-22.
ALF :
Family housing allowance (allocation de logement familiale see Aides personnelles au logement.
ALS :
Social housing allowance (allocation de logement sociale) see Aides personnelles au logement.
ANAH :
National Housing Agency (Agence nationale de l’habitat)
Livret A :
The Livret A is a regulated savings account with a preferential
interest rate set by the government, a deposit limit, and tax-free annual
returns - for more see page 4.
PEEC :
see Action logement
Social Housing :
French social housing (logement locatif social) is a form of
regulated housing, which might be public or private-owned, but which
is governed by a so-called APL-agreement (because it opens up right
to personalised housing aids) between the owner and the State.
Social housing is usually built with the help of public subsidies,
has a regulated rent, and is subject to attribution rules.
Zoning :
ANRU :
System by which French housing policy is implemented according
to the varying characteristics of geographical zones. See page 4.
National Agency for Urban Renewal (Agence nationale
pour la rénovation urbaine)
1% logement :
APL:
Personnalised housing aid (aide personnalisée au logement) see Aides personnelles au logement. May coloquially refer
to either the sum of the three personal housing aids (les APL) or to
just the personnalised housing aid (l’APL).
CDC :
the Deposits and Consignments Fund (Caisse des dépôts
et consignations) is a public-sector financial institution.
CGLLS :
The Social Rental Housing Guarantee Fund (Caisse de garantie
du logement locatif social) is a public sector guarantee and financial
institution for the social housing organisms.
HLM :
Controlled-rent housing (habitat à loyer modéré) is the main form
of social housing, usually governed by an HLM organism, which may
be publicly or privately owned. HLM organisms are grouped under the
umbrella of the Social Housing Union (Union sociale de l’habitat - USH).
see Action Logement
> HOUSING AIDS AND SUBSIDIES IN FRANCE
GLOSSARY
—
Aides personnelles au logement :
5
FEBRUARY 2017
GENERAL FRAMEWORK
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
6
GENERAL FRAMEWORK
FINANCIAL AIDS
AT A GLANCE
—
Aided loans and public subsidies
for social rental housing
Social rental housing is commonly referred to by the name of the
subsidised loan that has contributed to its financing.
The PLUS (prêt locatif à usage social - rental loan
for social needs) is currently the most frequently used aided loan
for the financing of social rental housing.
The PLAI (prêt locatif aidé d’intégration - subsidised
rental loan for integration) finances rental housing intended
Loans for energy efficiency improvement works
The zero-rate eco-loan (éco-prêt à taux zéro) finances
works intended for improving the energy efficiency of existing housing,
for up to 30 000 €.
The social housing eco-loan (éco-prêt logement social)
is a subsidised loan that helps low-cost social housing organisms with
financing works that improve energy efficiency for the least efficient
dwellings.
for households cumulating economic and social difficulties. It has the
lowest rent ceiling of the three.
Tax advantages
The PLS (prêt locatif social - loan for social rental
housing) finances rental housing located primarily in areas where
The reduced 5.5% VAT rate is applied in areas that fall under
the reponsibility of the National Agency for Urban Renewal (ANRU), as
well as within 300 meters of such areas, for means-tested households
who first own a home, provided the home is a newly built main
residence.
the housing market is tenser. It has the highest rent ceiling of the three.
Rental housing financed by one of these three loans must be the
subject of a convention providing a framework for its use (in particular
regarding maximum rent and maximum income of tenants), and
allowing tenants access to personal housing aids (APL - aides
personnalisées au logement).
Public subsidies are served for the completion of PLUS and PLAI
housing. These subsidies can be supplemented, including for PLS
housing projects in very tense areas, in order to cover up to 50% of the
cost of a project that exceeds a cost of reference (subvention pour
surcharge foncière). PLUS, PLAI and PLS housing is also elegible for tax
privileges (reduced 5,5 % VAT rates and 25-year exemption of property
tax on buildings).
Home ownership loans
The PTZ (prêt à taux zéro - zero-rate loan) is a means-tested
loan that contributes to financing first home ownership projects, mainly
where new housing is concerned. The absence of interests is compensated by the state. The scale of the loan varies with different parameters, including the size and income of the household, as well as the
characteristics of the housing (notably its location).
The PC (prêt conventionné - regulated loan) finances
the acquisition of a main residence, and makes the tenant eligible
for personal housing aids (APL), provided he meets the income
requirements.
Certain regulated loans under income requirements, such as the PAS
(prêt d’accession sociale - social home ownership loans), benefit from
a state guarantee.
The PSLA (prêt social de location-accession - social
renting-ownership loan) is an innovative means-tested product
that finances home ownership loans for newly built houses, starting
out with a rental phase which then gives way to the ownership phase.
Beneficiaries are eligible for tax advantages and a safety net
(guaranteed buy-back and relocation in case of major life accident).
The tax credit for energy transition (crédit d’impôt
transition énergétique - CITE) allows for deducing from income
tax 30% of certain expenses for works improving energy-efficiency.
The reduced 5.5% VAT rate applies to energy-efficiency
improvement works which qualify for the energy transition tax
credit (CITE), as well as to indissociably linked works.
The reduced 10% VAT rate applies to other renovating
works in private housing.
Tax advantages (deduction from taxable income or tax rebate)
are granted to households who buy new housing for the purpose of
renting them out. Enacted in 2013, incentives for investment in
intermediary social housing consist of a tax rebate for newly built
housing in tense areas, which is rented out in respect of rent ceilings
inbetween those of social housing and those of the free market, to
means-tested households. The so-called “Borloo ancien” allows
for a deduction from taxable income from property, for dwellings that
are subject to a renting convention with the National Agency for
Housing (Anah).
Tax advantages (reduced 10% VAT rate and exemption from property
tax on buildings for up to 20 years) are granted to institutional investors
for the construction of intermediary rental housing. This measure only
applies in tense areas, and provided the same income and rent ceilings
as for the incentives for intermediary rental housing are met.
01
08Rental loans for integration
(PLAI) and for social needs
(PLUS)
08Loans for social rental
housing (PLS)
09Facts and figures for PLAI,
PLUS and PLS
09Upgrading and renovation of
social rental housing (PAM)
10Intermediary rental loan (PLI)
10Incentives for intermediary
rental housing construction
by institutional investors
> HOUSING AIDS AND SUBSIDIES IN FRANCE
SOCIAL RENTAL
AND INTERMEDIARY
HOUSING
FEBRUARY 2017
7
01.
SOCIAL RENTAL AND INTERMEDIARY HOUSING
RENTAL LOANS
FOR INTEGRATION
(PLAI) AND SOCIAL
NEEDS (PLUS)
—
© ARNAUD BOUISSOU/TERRA
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
8
Purpose and scope of the loan
The PLAI (prêt locatif aidé d’intégration) and the PLUS (prêt locatif à
usage social) are designed to finance the acquisition or the building
of social rental housing, as well as, where necessary, the corresponding
improvement or rehabilitation works. These loans are available, either
to low-cost social housing organisms (organisme HLM), to local
authorities without such organisms on their territory, or to other
government-approved organisms. They are conditioned upon the
signing of a personal housing aids convention (convention APL)
with the state.
In addition to the loan itself, operations financed via PLUS or PLAI carry
the right to a state subsidy, as well as a reduced 5.5% VAT rate and
a 25-year exemption of property taxes on buildings.
Financial terms
The amount of the loan is based on the provisional financing plan,
such as to cover up to 100% of the building cost, excluding the state
subsidies to which PLAI and PLUS loans carry the right. The normal
duration of the loan is maximally 40 years (60 under certain circumstances).
Pay out of the loan may occur either during a pre-financing period
lasting up to 24 months, or over a period of ten months when
construction has started.
The start of payback for capital and interests can be deferred up to
24 months. It is due in annual progressive maturity rates, with an
interest rate of currently 1.35% for the PLUS and 0.55% for the PLAI,
which may be revised based on the evolution of the rate for the livret A.
All loans must be guaranteed in their entirety, either by local authorities,
by the CGLLS (public agency for the guarantee of social rental
housing), or, where not available, a bank guarantee or a mortgage.
The loans are exclusively granted by the Caisse des dépôts et
consignations (CDC).
LOANS FOR
SOCIAL RENTAL
HOUSING (PLS)
—
Purpose and scope of the loan
The PLS (prêt locatif social) is a preferential loan granted to a person
or institution for the construction, acquisition or rehabilitation of
housing for social rental purposes.
Financial terms
The loans are distributed by credit establishments which signed an
annual refinancing agreement with the Caisse des dépôts et consignations (CDC), or granted directly by the CDC.
Social landlords applying for this loan must sign a personal housing
aid convention with the state (convention APL), for a duration of 15 to
40 years, depending on circumstances.
While the PLS does not carry the right to a state subsidy , it does carry
the right to benefit from a reduced VAT rate, and from a 25-year
exemption of property tax on buildings.
Facts and figures
Covers 50 to 100% of the cost of the operation (excluding subsidies).
Interest rate: from 1.86% (for social housing organisms)
up to 2.11%, indexed on the rate of the livret A.
Distributed by the CDC or credit establishments with CDC agreement.
01.
9
UPGRADING
AND RENOVATION
OF SOCIAL RENTAL
HOUSING
—
Statistics
LOAN FOR HOUSING IMPROVEMENT
(PAM)
In 2015, nearly 125.000 dwellings have benefited from either PLS,
PLUS or PLAI-loans ; among them about 5000 overseas and 11 000
through the National Agency for Urban Renewal.
PLAI
PLUS
PLS
DWELLINGS FINANCED IN 2015
28%50%22%
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FACTS AND
FIGURES FOR
PLAI, PLUS & PLS
—
FEBRUARY 2017
SOCIAL RENTAL AND INTERMEDIARY HOUSING
Purpose and scope of the loan
The loan for housing improvement (PAM - prêt à l’amélioration de
l’habitat) finances improvement works, notably renovations bringing
buildings up to standards of habitability or energy efficiency, lower
rental expenses, that strengthen safety of people and goods, or improve
quality of life.
Financial terms
Rent ceilings
Rents for housing aided or subsidised under the PLAI, PLUS and PLS
schemes may not exceed a maximum amount, which is calculated
notably taking into account a maximum rent per square meter
of usable floor space, determined by geographical zone.
This maximum amount is comprised:
between 4,56 and 5,97€ per square meter for PLAI,
between 5,14 and 6,70€ per square meter for PLUS,
between 7,71 and 13,07€ per square meter for PLS.
The loan can finance up to 100% of renovation costs, minus subsidies.
Its duration lies between 5 and 25 years.
The loan is revisable, and the interest rate equal to that of PLUS loans
(ie. 1.35%, indexed on the rate for the livret A).
Pay-out and guarantee terms are identical to those applicable to PLAI
and PLUS.
A margin of appreciation is however left to local representatives of
the government, to take into account criteria such as energy efficiency.
Furthermore, the respect of these rent ceilings is appreciated at the
level of the entire project, not for each dwelling.
Ressource ceilings
Ressource ceilings are the maximum income of reference for tax
purposes that a household may earn in order to be eligible, either
for subsidies, or to rent a property constructed under one of the loan
schemes. They are adjusted each year on January 1st based on the
evolution of the rent reference index.
The ressource ceilings vary according to the geographical zone, with
ceilings being highest in Paris and neighbouring cities, and lower
in the rest of France.
For 2015, the following sample ressource ceilings are applicable:
SINGLE PERSON
11 058 - 12 722 €
20 017 - 23 127 €
26 139 30 065 €
COUPLE WITH TWO CHILDREN
21 558 - 29 757 €
38 892 - 54 098€
50 677 70 327 €
© GERARD CROSSAY/TERRA
TYPE OF PLAI PLUSPLS
HOUSEHOLD
CEILINGCEILINGCEILING 01.
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FEBRUARY 2017
SOCIAL RENTAL AND INTERMEDIARY HOUSING
> HOUSING AIDS AND SUBSIDIES IN FRANCE
INCENTIVES
FOR INTERMEDIARY
RENTAL HOUSING
CONSTRUCTION
BY INSTITUTIONAL
INVESTORS
—
© ARNAUD BOUISSOU/TERRA
Purpose and scope of the tax incentives
INTERMEDIARY
RENTAL LOAN (PLI)
—
Purpose and scope of the loan
The PLI (prêt locatif intermédiaire) can be used to finance the
acquisition or construction of rental housing, as well as corresponding
required improvement works.
A prior administrative authorisation is required in zone C (where the
market is least tense), however not in zones A and B.
The loan does not carry the right to a state subsidy or tax advantage.
Financial terms
PLI loans are distributed either by the CDC, or by credit establishments
under agreement with the CDC.
The interest rate is 2.15% up to 2.40%, indexed on the livret A rate.
The maximum duration is 35 years. Other terms for payout and
guarantee are identical to those applicable for PLAI and PLUS loans.
The tax regime in favour of intermediary housing is designed to
encourage the construction of new housing in tense areas, for rental
use as a main residence. A wide array of public and private organisms
are eligible to this regime.
It applies only in zones A and B1 (with the most tense housing
markets), and dwellings must have received a prior authorisation
granted by public authorities.
By accepting the scheme, the landlord commits to leasing the housing
for at least 15 years - he may however sell up to 50% of it beginning
with the 11th year.
The scheme is conditioned upon the respect of rent and ressource
ceilings, which guarantee its intermediary character. These ceilings
are identical to those of the incentives for private persons to invest in
rental housing. In order to benefit from the scheme, the project must
be integrated within a larger property dedicating at least 25% of its
floor space to social rental housing.
Tax advantages
The agreement carries the right to an intermediary VAT rate, at 10%,
as well as to an exemption of property taxes on buildings for a
maximum duration of 20 years or until the property is sold.
02
12Zero-rate loan
(PTZ – prêt à taux zéro)
13Regulated loan
(PC – prêt conventionné)
14Social rental-ownership loan
(PSLA)
14Reduced VAT in urban
renewal areas (zone ANRU)
> HOUSING AIDS AND SUBSIDIES IN FRANCE
HOME
OWNERSHIP
FEBRUARY 2017
11
02.
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
12
HOME OWNERSHIP
ZERO-RATE LOAN
(PTZ)
—
EXAMPLES OF PTZ LOANS
(valid from 1st January 2016)
ONE ADULT
INCOME TAX REFERENCE 30 000 €
Purpose and scope of the loan
The PTZ is a complementary interest-free loan intended for households
who haven’t owned their main residence in the last two years.
The PTZ is means-tested. It may finance a new project. It may also
finance the acquisition of existing housing, provided that said housing
is a social rental dwelling sold to its tenants, or provided that said
housing is subject to improvement works.
Financial terms
ew dwelling in zone A, cost 180 000 €
N
Maximum amount below ceiling 150 000 €
0,40 x 150 000 = 60 000 €
Other loans of more than two year’s duration contributing to
financing the dwelling: 120 000 €.
The amount of the PTZ is 60 000 €.
Its total duration is 20 years, including a 5-year period of
deferral.
The PTZ is distributed by banks which have signed an agreement with
the state. To compensate for the absence of interests, the banks are
granted a corporate tax credit. The banks are themselves responsible
for assessing the credit-worthiness of the borrower.
To be eligible, potential borrowers must have an income below the
following ceilings. These ceilings vary according to geographical zone,
from highest in the most tense zones, to lowest in the least tense zones.
TYPE OF
HOUSEHOLD
SINGLE PERSON
LOWEST PTZ
HIGHEST PTZ
INCOME CEILING INCOME CEILING 24 000 €
37 000 €
COUPLE WITH TWO CHILDREN48 000 €
74 000 €
The PTZ loan is not intended as a main loan, and its amount must be
limited to a maximum of as low as 10% and as high as 40% (depending on the characteristics of the project) of the amount of the project,
within the limit of ceilings for each projects. These ceilings vary
according to type of household and geographical zone.
A period of deferral for the repayment of the loan can be agreed upon,
depending on the income of the borrower (5, 10 or 15-year period of
deferral).
Facts and figures
In 2015, around 60.000 PTZ-loans have been granted, for an
average of 38.000 euros.
On average, PTZ-loans covered 19.5% of the total cost of each
project.
TWO ADULTS
INCOME TAX REFERENCE 38 400 €
New
dwelling in zone B2, cost 155 000 €
Maximum amount below ceiling 154 000 €
0,40 x 154 000 = 61 600 €
Other loans of more than two year’s duration contributing to
financing the dwelling: 93 400 €.
The amount of the PTZ is 61 600 €.
Its total duration is 20 years, including a 5-year period of
deferral.
TWO ADULTS WITH TWO CHILDREN
INCOME TAX REFERENCE 24 000 €
dwelling in zone C (existing housing + improvement
Old
works), cost 150 000 €
Maximum amount below ceiling 150 000 €
0,40 x 150 000 = 60 000 €
Other loans of more than two year’s duration contributing to
financing the dwelling: 90 000 €.
The amount of the PTZ is 60 000 €.
Its total duration is 25 years, including a 15-year period of
deferral.
NOTE : zones are classified from A (most tense) to C (least tense).
02.
Purpose and scope of the loan
© BERNARD SUARD/TERRA
The regulated loan is a principal loan that can be used to finance:
the construction or acquisition of new housing, including, where
necessary, the acquisition of building rights or land;
the remodeling for housing purposes of buildings previously used
for other purposes;
the acquisition of old housing and, if necessary, the relevant
improvement works;
certain improvement works;
the increase of floor space;
the adaptation of housing for disabled people.
Regulated loans are exclusive of all other loans, except those listed
by government regulation.
Households with a regulated loan are awarded personalised housing
aids (APL) normally reserved for social housing.
A distinction is made between means-tested social home ownership
loans (prêts d’accession sociale - PAS), which benefit from a state
guarantee, and normal regulated loans.
Financial terms
Interest rates are comprised between 4.35 and 4.80% for non
means-tested loans, and between 3.75 and 4.20% for means-tested
loans (with PAS), depending on the duration of the loan.
PAS loans, in contrast to other regulated loans, are means-tested, based
on composition of the household (number of persons who will occupy
the dwelling as a main residence), and location of the dwelling.
Currently, the applicable ceilings are identical to the PTZ-ceilings.
FEBRUARY 2017
REGULATED LOAN
(PC : PRÊT
CONVENTIONNÉ)
—
13
> HOUSING AIDS AND SUBSIDIES IN FRANCE
HOME OWNERSHIP
02.
HOME OWNERSHIP
SOCIAL RENTALOWNERSHIP LOAN
(PSLA)
—
Purpose and scope of the loan
The PSLA (prêt social de location-accession) is a regulated loan
granted to an organism (low-cost housing organism, mixed-investment
company, private developer…) to finance the construction or
acquisition of new dwellings that will be the subject of a rental-ownership contract.
It carries the right to benefit from the reduced 5.5% VAT rate, and from
a 15-year exoneration of property tax on buildings, provided such an
agreement has been signed with the state. If the organism hasn’t found
a suitable candidate for a rental-ownership agreement by the end of an
18-year commercialisation period, the dwelling can be rented as if it
had been financed via PLS-loan and still retain the initial tax advantages of the PSLA.
A rental-ownership has two phases:
a rental phase, during which the tenant pays a fee constituted of a
rental component (corresponding to a capped rent) and an acquisition
component (which will constitute a personal contribution toward the
acquisition of the dwelling and will be deducted from the sale price);
an ownership phase, which starts when the household levies the
buying option on the dwelling, if applicable under financial terms that
were agreed on from the start.
Financial terms
The amount of the PSLA loan can cover up to 100% of the operation
cost.
Applicable ressource ceilings for tenants must not exceed those
applicable to PSLA loans.
In case the option is levied, the household has an additional fifteen
year guarantee during which it can re-sell the dwelling for a pre-determined price (decreasing with time) and with a re-housing guarantee.
© ARNAUD BOUISSOU/TERRA
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
14
REDUCED VAT RATE
IN URBAN RENEWAL
AREAS (ZONE ANRU)
—
Purpose and scope of the loan
The reduced VAT rate is intended for means-tested persons who build
or buy their main residence new in areas that are either subject to an
urban renewal contract signed with the Urban Renewal Agency (ANRU
- Agence nationale de rénovation urbaine), to priority urban policy
areas (quartier prioritaires de la politique de la ville - QPV), or entirely
located within 300 meters of the limits of such areas.
Financial terms
The VAT rate is reduced to 5.5 %.
The ressource ceilings are the PLS ceilings plus 11%. These sample
ceilings are applicable in 2015:
TYPE OF
HOUSEHOLD
APPLICABLE INCOME CEILING
FOR REDUCED VAT RATE
INURBAN RENEWAL AREAS SINGLE PERSON
29 014 - 33 272 €
COUPLE WITH TWO CHILDREN
56 251 - 78 063€
03
16Zero-rate eco-loan
16Tax credit for energy
transition (CITE)
17Eco-loan for social housing
17Other aids and subsidies for
energy efficiency
> HOUSING AIDS AND SUBSIDIES IN FRANCE
AIDS AND SUBSIDIES
FOR ENERGY
EFFICIENCY
FEBRUARY 2017
15
03.
AIDS AND SUBSIDIES FOR ENERGY EFFICIENCY
ZERO-RATE
ECO-LOAN
—
Purpose and scope of the loan
The zero-rate eco-loan (éco-PTZ) is an interest-free loan, available
without means-testing, for the financing of renovations aimed at
improving energy efficiency. To be eligible, improvement works must
either perform a certain number of improvements (from a specified list),
improve the energy-efficiency of a dwelling by a certain rate, or
rehabilitate individual sanitation systems by means that do not
consume energy.
Only pre-1990 buildings are eligible.
© LAURENT MIGNAUX/MEDDE-MLETR
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
16
Financial terms
As with the PTZ (zero-rate loan, see above), the zero-rate eco-loan is
distributed by credit establishments who signed an agreement with
the government, under their own responsibility.
The amount of the loan may cover up to 100% of the cost of the
eligible improvement works, or 10 to 30.000 €, whichever is higher,
depending on the type of works conducted.
Loans are granted for a duration of 3 to 10 years, and up to 15 years
for the heaviest types of renovations.
The zero-rate eco-loan may be cumulated with other aids, such as the
tax credit for energy transition, or aids by local authorities, under certain
conditions.
TAX CREDIT
FOR ENERGY
TRANSITION
(CITE)
—
Facts and figures
Purpose and scope of the loan
To be eligible, improvement works must be carried out by an
approved professional.
In 2015, 23 567 zero-rate eco-loans have been granted, for a total
sum of 405 million euros.
The tax credit for energy transition (CITE, crédit d’impôt transition
énergétique, formerly CIDD - sustainable developement tax credit)
allows for the deduction from income taxes of a sum corresponding
to 30% of the cost of certain energy-efficiency improvement works.
If this sum is superior to what the tax-payer owes in income taxes,
the rest is payed out as a tax return.
To be eligible, dwellings must be used as a main residence and be
at least two years old.
Financial terms
The maximum eligible cost of improvement works is 8.000 € for
a household of one, 16.000 € for two, and a further 400 € for every
dependent.
Facts and figures
As it stands, the sustainable development tax credit is set to run
out on 31 December 2017.
To be eligible, improvement works must be carried out by an
approved professional.
03.
OTHER AIDS
AND SUBSIDIES
FOR ENERGY
EFFICIENCY
—
Purpose and scope of the loan
Reduced VAT rate for improvements to private
housing
The eco-loan for social housing (éco-prêt logement social) is a loan
awarded to social landlords (social housing organisms, mixed-economy
companies, local authorities...) who signed an agreement with the
government, for energy-efficiency improvements to social housing,
and especially to those buildings with particularly bad energy-efficiency.
This loan is part of the government’s stated goal to renovate at least
120.000 dwellings per year.
Financial terms
The eco-loan for social housing is distributed by the Caisse des dépôts
et consignations (CDC).
The amount of the loan varies from 9.000 to 16.000 € per dwelling,
depending on the expected energy-efficiency gain. An additional
2.000 € may be awarded if the renovated dwelling qualifies for
an energy-efficiency label (such as HPE or BBC).
The rate of the loan is comprised between 0.00% (over 5-15 years)
and 0.50% (over 21 - 25 years).
Owners or tenants who hire a professional contractor to carry out
renovation works to improve energy efficiency, benefit from a reduced
VAT rate of 5.5 (for energy-efficiency improvement works eligible for
CITE) or 10%, instead of the normal 20% rate.
Dwellings older than two years, used as a main residence, are eligible.
Exemption from property tax on buildings for
private households
Local authorities may enact a partial or total exemption from property
taxes on buildings for dwellings built before 1989, on which the owner
carries out certain energy-efficiency improvements for a cost of either
10.000 € or more the year before the exemption, or 15.000 € over
the three years before the exemption.
Sharing of gains from reduced expenses
Landlords who carry out energy-efficiency improvements may require
their tenant to participate in the cost, by paying back a fraction of the
savings on expenses (such as heating costs...) resulting from the
improvement works.
This contribution by the tenant is of a fixed amount, non-revisable,
and for a maximum of 15 years. It cannot exceed half of the estimated
savings.
Reduced VAT for improvements to social housing
Since January 2014, certain renovation works on social housing
(including energy-efficiency, accessibility, safety improvements…)
benefit from a reduced VAT rate of 5.5%.
Reduced property tax on buildings, for social
landlords
© GERARD CROSSAY/TERRA
Social housing organisms or mixed-economy companies who carry
out energy-efficiency improvements which are eligible for the reduced
5.5% VAT rate (see above) can also benefit from a tax credit on the
property tax on buildings, corresponding to 25 % of the cost of improvement works.
FEBRUARY 2017
ECO-LOAN
FOR SOCIAL
HOUSING
—
17
> HOUSING AIDS AND SUBSIDIES IN FRANCE
AIDS AND SUBSIDIES FOR ENERGY EFFICIENCY
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
18
INVESTMENT
IN PROPERTY FOR
RENTAL PURPOSES
04
19“Pinel” support scheme for
investment in intermediary
rental housing
19“Cosse” support scheme for
improvements to intermediary
rental housing
04.
19
© BERNARD SUARD/MEDDE-MLETR
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
INVESTMENT IN PR OPERTY FOR RENTAL PURPOSES
“PINEL” SUPPORT
SCHEME FOR
INVESTMENT
IN INTERMEDIARY
RENTAL HOUSING
—
“COSSE” SUPPORT
SCHEME FOR
IMPROVEMENTS
TO INTERMEDIARY
RENTAL HOUSING
—
Purpose and scope
Purpose and scope
Named for former minister Sylvia Pinel, this support scheme grants
the beneficiary an income tax break for the acquisition of newly-built
dwellings, fully renovated dwellings, or the construction of new
dwellings, between 1 January 2013 and 31 December 2016.
These dwellings must be located in the areas where the housing
market is most tense (zones A and B1, and exceptionnally B2 with
special authorisation).
These new dwellings are subject to an energy-efficiency clause. Should
they not qualify for one of the energy-efficiency labels (RT 2012, HPE,
BBC...), they are not eligible for the tax break.
Dwellings must be rented for a minimum of 6, 9 or 12 years, to tenants
whose ressources cannot exceed a maximum amount based on the
composition of the household, and for a maximum rent per square
meter, ensuring that the tax break retains its social objective.
This scheme, named for minister Emmanuelle Cosse, benefits landlords
who sign an agreement with the National Housing Agency (Anah),
wherein they agree to lease their dwelling for a rent lower than normal
market prices, to tenants below a certain maximum income. Both the
maximum rent and the maximum income are fixed by the agreement
with Anah, within the limits of national ceilings.
In exchange, the landlord benefits from an income tax break between
15 and 85% of his rental income (depending on rent and tenant
profile). He can also benefit from Anah-subsidies for necessary
improvement works, which are normally means-tested.
Financial terms
Depending on the chosen duration of rental obligation, the tax break
is calculated as 12, 18 or 21% (23, 29 or 32% for overseas départements) of the acquisition cost, within a double maximum of 300.000 €
per dwelling and 5.500 € per square meter, over nine years.
Only two built or acquired dwellings per year per person are eligible.
This tax credit is also capped by the the global ceiling on tax credits
(10.000 € in 2015, except in overseas departements).
FEBRUARY 2017
20
> HOUSING AIDS AND SUBSIDIES IN FRANCE
PERSONAL
HOUSING
AIDS
05
21Introduction to personal
housing aids in France
21Personal housing aids today
22Family Housing Allowance
(ALF)
22Social Housing Allowance
(ALS)
22Personalised Housing Aid
(APL)
05.
21
© ARNAUD BOUISSOU/TERRA
INTRODUCTION
TO PERSONAL
HOUSING AIDS
IN FRANCE
—
The system of personal housing aids in France comprises three distinct,
but closely linked allowances, which share the goal of lessening the
burden of paying rent or mortgages in a housing market that has been
tense for decades.
The first of these schemes, the family housing allowance (ALF - allocation de logement familiale), is created in 1948. From its inception, this
means-tested scheme is intended to help families with children, faced
with a post-World War II housing market in which new construction had
not yet made up for the housing destroyed in World War II - especially
those families who cannot afford appropriate housing at normal market
prices.
The benefit of personal housing aids is extended in 1971 with the
creation of the social housing allowance (ALS - allocation de logement
sociale) to other vulnerable people, who cannot benefit from the family
allowance because they have no children - seniors and handicapped
people, young workers, the long-term unemployed, and finally people
on minimum benefits. In the 1990s, this is further extended to include
all people, on a means-tested basis, who were previously not eligible
to either the family housing allowance, or the personalised housing aid
(APL).
This personalised housing aid (APL - aide personnalisée au logement)
is created by the 1977 “Barre Law”, named for then-Prime minister
Raymond Barre. Again on a means-tested basis, the personalised
housing aid is attached to certain types of dwellings, mainly social
dwellings but also some private dwellings, under a case-by-case
agreement between the state and the landlord. Initially, personalised
housing aids were much more generous than the two other types
of aids, but today, ALF and ALS have been adjusted upward and are
equivalent to the personalised aid for most dwellings.
PERSONAL
HOUSING AIDS
TODAY
—
Today’s personal housing aids still consist of those three distinct
allowances (ALF, ALS and APL), but they paint a unified picture and
are generally collectively known in French as “les APL”.
“Les APL” are, de facto if not de jure, a universal allowance, meant to
help households cover their housing costs (rent or mortgage). Even
though they are means-tested, 6.5 million of the 27.5 million French
households benefit from them, representing 50% of those who rent
their dwelling, and 10% of those who buy their first home.
The total costs of personal housing aids exceeds 18 billion euros,
financed mostly by the government (15 billion euros) and employer
contributions (about 50% of ALS). These figures are very dynamic,
and increase every year, especially so in times of economic turmoil.
In 2015, the cost has increased by 2.9% compared with 2014 for APL,
and by 0.6% and 0.9 % for ALS and ALF respectively.
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
PERSONAL HOUSING AIDS
05.
22
FEBRUARY 2017
PERSONAL HOUSING AIDS
> HOUSING AIDS AND SUBSIDIES IN FRANCE
SOCIAL HOUSING
ALLOWANCE
(ALS)
—
Characteristics
The social housing allowance has similar criteria and objectives to
the family housing allowance, and is today intended as a safety net,
concerning everyone under the ressource ceiling who is not eligible
to either the family housing allowance or the personalised housing aid.
This includes mainly youths, students, households without children,
elderly and handicapped people.
© LAURENT MIGNAUX/MEDDE-MLETR
Facts and figures
2.4 million beneficiaries
5.3 billion euros in 2014, financed by employer contributions
and the government (about half each)
FAMILY HOUSING
ALLOWANCE
(ALF)
—
PERSONALISED
HOUSING AID
(APL)
—
Characteristics
Characteristics
The family housing allowance is intended to help families bear the cost
of rental housing or the acquisition of their first home.
To benefit from the allowance, both the household and the dwelling
need to be eligible. The household either needs to be eligible to certain
other allowances for families, or to satisfy certain criteria (age,
children...).
The personal housing aid is intended for households in social rental
housing. While originally much more generous than ALF and ALS, the
amount of the subsidy is today identical for most cases to the amount
for the other aids, which have been increased.
In addition to households in social rental housing, those households
who benefit from a regulated loan or a PAS, are eligible to personalised
housing aids.
Facts and figures
1.3 million beneficiaries
4.5 billion euros in 2014, financed by social contributions
(from 2016 on, the ALF will be financed directly by the State)
Facts and figures
2.8 million beneficiaries
8.2 billion euros, financed by the government
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
23
DESIGN AND LAYOUT :
Citizen Press / Paris
> HOUSING AIDS AND SUBSIDIES IN FRANCE
FEBRUARY 2017
24
General directorate for development, housing and nature
Directorate for housing, town planning and landscapes
Sub-directorate for the financing and the economy of housing and development
92055 La Défense Cedex
France
www.logement.gouv.fr