The irresistible rise of inflation – Business Immo

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The question of inflation will again (and always) be a priority on the back-to-school agenda of players in the real estate industry. Prices did not slow down in August in the euro zone, at 5.3% over one year according to Eurostat data. In France, the consumer price index even rebounded last month and increased by 4.8% over one year (+5.7% with the HICP index which allows a European comparison). In short, monetary tightening policies are slow to produce their effects.

It is in this tense context, in particular for public finances, that the Prime Minister Elisabeth Borne wanted to reassure business leaders at the REF (Rencontres des entrepreneurs de France) by reaffirming the “pro-business” policy of the executive.

A policy of supply which does not exclude a few tax cuts, such as the abolition of the CVAE (contribution on the added value of companies) spread over the five-year period instead of being effective from 2024. policy which has above all decided to sacrifice real estate. The abolition of the Pinel device and the refocusing of the zero-rate loan should represent €2.3 billion in budgetary savings from 2025, recalled Thomas Cazenave, Minister Delegate for Public Accounts.

However, real estate is in dry dock. Construction figures wipe out record lows after record lows. The level of transaction is in free fall, between professionals as well as with individuals. A crisis of confidence threatens SCPIs, a showcase for real estate investment in the eyes of the French, some of whom have been forced to lower the price of shares under pressure from theFinancial Markets Authority (AMF).

New housing minister half-opened a door to institutions by asserting on France Inter to work on a « device which would make it possible to mobilize professional investors on rental investment ». At the same time, he warned that there will be no « great national measure » as some professionals could still hope after the end of the executive’s refusal to accept the proposals made by the CNR Housing.

It’s good Jerome Powell who has the keys to recovery. And the boss of the EDF was adamant at the end of the Jackson Hole central bankers symposium: “We will continue our efforts until the job is done. That is, until inflation drops to 2%.