Paris: Is it too expensive – are you too poor

Beautiful for tourists - Expensive for residents. Street crossing in the 17th arrondissement of Paris.

Paris – differences between income classes deepens. The newspaper Lemonde explored this question in an interview with sociologists Monique Pincon-Charlot and Michel Pincon. These two, close to the anti-capitalist left. are researching among other things the state of social and urban segregation.

Specially in Paris the population has changed drastically since 1954. Whereas 34.5 percent of the population were in middle or higher occupations at the time, this figure had risen to 71.4 percent by 2010. This is due on the one hand to the de-industrialization since 1962, the banlieues and the global importance of Paris as a financial sector.

Caption of a courtyard in the neighboorhood of "Batignolles" in the 17th Arrondissement. The building is made of orange bricks and is quite dense. More then 6 storeys high the three buildings are filling the entire image.
Stacked housing for high earners – Building in the 17ème Arrondissement of Paris (Foto/ Urbanauth)

Rich and rich remain among themselves. In the “Beaux Quartiers” such as the 16th and 17th or suburbs such as Neuilly sur Seine, the wealthiest city in France, worlds of their own are formed and thus also a gap between the poor and the wealthy.

While Paris, as a cultural capital, offers its inhabitants many spectacles, exhibitions and places to go out, and is the first city in the index of cities with the best standards of living, the situation is different a few steps behind the motorway that separates the city from its agglomeration:

In Saint Denis, north of Paris, a couple earns on average 2154 € per month. Singles are doing best with an average of 1487 € and still live at the minimum.

The newspaper La Gazette des Communes looked into the question of the extent to which inequalities exist in the Greater Paris region and summarised them in a map. The Banlieues Argenteuil, Aulnay-sous-Bois, Montreuil and Saint Denis had a poverty rate of at least 20 percent at the end of 2015. Saint-Denis even exceeds the others with a rate of 35%. And that with a share of social buildings, that is around 33 percent.

These are in stark contrast to the areas in the west of Paris, like La Defense, where more than half of the municipalities fail to meet the statutory quota of 20-25 percent of social buildings. Instead, suburbs like Neuilly Sur Seine, with a 5% share, prefer to pay fines and maintain their homogeneity.

After Paris, the rest?

The building situated in Saint Ouen is freshly built and part of a bigger renovation and revitalisation of urban spaces in the suburbs of Paris. Specially with the rising housing prices, many people from the middle class are driven out of the capital.
New developed area “Les Docks” in St. Ouen (93), a suburb of Paris, which becomes more and more interesting for investors. The 2024 Olympic Games and the opening of the new Porte de Clichy Palace of Justice contributing to it. (Foto/ Urbanauth)

In the light of the Grand Paris and its expansion of the infrastructure, one has to wonder to what extent the suburbs will be gentrified. Even though some municipalities, especially in the north, have so far taken measures to maintain diversity among the population, many students from the middle class are now moving to the suburbs.

It is not without reason that the left-wing medium StreetVox is concerned about developments in the Seine Saint Denis in the shadow of the 2024 Olympic Games. For example, commercial buildings, housing for students and migrant workers were destroyed. While the companies and students moved, this is not the case for the housing of the migrant workers. This, which had housed foreign workers since 1972, was replaced by a social building. But also the magnetic attraction of the Olympic Games on investors is a key question. We reported previously on JPMorgan and its AdvancingCities initiative.

The Olympic Village, which will accommodate a large number of Olympians with 17,000 beds, will later be converted into 22,000 apartments, 900 student accommodations and 100,000m² of commercial space. The newly created apartments will be marketed as condominiums with standing and will probably not be affordable for the average population of the Seine Saint Denis.

Marseille: Housing collapse claims eight lives

A Street Art of Nelson Mandela in the neighbourhood of Noailles in Marseille. The neighbourhood is known for derelict housing.

It’s a miracle that accidents don’t happen every day in Marseille,” says an anonymous expert from the TGI (Tribunal de grande instance de Marseille), among other things, about what happened on 5 November 2018 in the district of Noailles, Marseille. Two dilapidated houses collapsed in the morning and eight people were buried in the rubble. The doors of the first house, which has been classified as dilapidated since 2008, were locked or bricked up, but neighbours suspect that squatters have nevertheless gained access. In the second collapsed house, from which chunks of the façade had already broken out in September of this year, there were nine apartments, inhabited by couples and families. But these houses are by no means the only ones in a precarious condition. A government survey carried out in 2015 showed that 40,000 houses (out of a population of around 100,000) were “a risk to health or safety”. In the Noailles district, 48 percent of the building stock is considered dilapidated and inhumane.

The anger of the inhabitants is increasing. On the one hand, it is the homeowners who, even when renovation work is long overdue, only have to do the bare essentials; on the other hand, it is the municipal authorities who do not lift a finger when renovating houses or building social housing. On 14 November 2018, citizens, social organisations and interest groups commemorated the victims during a protest march with around 8,000 demonstrators.

The lack of social housing is also what forces many people to move into dilapidated houses, says Florent Houdmon, who works for the Abbé Pierre Foundation in the greater Marseille area against poverty and housing shortages. Nowhere else in France would such conditions exist. It’s no coincidence that the houses of the poor, of all people, are collapsing, as Jean-Luc Mélenchon of France Insoumise is sure when he expresses the thoughts of numerous residents of Marseille.

A technical explanation for the collapses could be the rainfalls that occurred days before, which are also held responsible for the cracks in the walls and a front door that no longer fits into the frame. However, this does not explain the lack of implementation of the principle of renovation that had already been adopted 20 years earlier, as Patrick Lacoste from the citizens’ initiative “A city centre for all” makes clear. Now the public prosecutor’s office is investigating for negligent homicide. Jean-Claude Gaudin, Mayor of Marseille since 1995, who was strongly criticised for the incidents, admitted for the first time on Sunday that he had not done enough in the fight against the dilapidated housing conditions. Insight as the first step towards improvement? It will come to light. It remains to be hoped that this incident will remain a unique example which will bring the city administration to action.

 

Berlin: Controversy around Germanys rent brake

Almost aesthetic: construction cranes during the blue hour (Photo by emcanicepic /pixabay licence)

Author’s note: This article contains outdated information.

Average earners in German cities have to leave a lot of money on the table to buy a new apartment – the rental price brake introduced in June 2015 has even increased the increase in this segment.

A study commissioned by the ARD magazine Panorama by the real estate market specialist empirica-systeme revealed unpleasant figures. Many households would have to spend more than 27% of their net income on rent, which is considered problematic by experts. The lower the income, the less money is left for other living expenses. In 64 German cities, residents with an average income cannot avoid paying more than 27%. This applies above all to smaller cities such as Schwerin, Erfurt and Rosenheim. In Berlin, on the other hand, the so-called rent burden rate is an incredible 41.3%.

The high prices can be explained on the one hand by increasing land prices and strong demand in cities, but on the other hand also by rising construction costs. As many building regulations in the areas of fire protection, noise protection and insulation have tightened since 2005, prices have risen by 33% during this period, according to the German Institute for Economic Research (DIW).

A measure criticised for inefficiency 

Building in the east of Berlin.

What concrete action has been taken against this? According to former commissioner Dietmar Walberg, the commission set up by the federal government in 2014 to reduce construction costs would have drawn up important proposals, but these were not implemented. The rent brake would also contribute little to improving the situation, according to the Association of Towns and Municipalities. This was introduced by the coalition in the last legislative period and tightened at the beginning of the year. Urban planning expert Norbert Portz sees no quantifiable improvement, and would not be opposed to abolition. The rent brake would only cure the symptoms of dilapidated housing construction and would not provide a viable solution. Instead, the federal government would have to assume more responsibility in social housing construction. It would be best for the municipalities to build themselves – which they are not doing at the moment, as land is available but private owners do not want to sell it. In Addition, jobs are to be transferred to the countryside, for example through digitisation – and thus give people a reason to move out of the city.

Who will benefit from the rent brake? Study author Claus Michelsen states that “the average development of rents is slowing down”. However, this is in the order of only 2 to 4%, and has no influence on the segment of new buildings – these are not subject to the rent brake. According to a DIW expert, this is a good thing, because otherwise the residential construction sector could be stalled.

Previously, the Federal Ministry of Justice had already investigated 91 cases, most of which took place in Berlin, where tenants successfully applied the brake in three quarters of the cases – resulting in average repayments of EUR 167 per month.

In seven federal states the rent brake does not apply at all. Although the states have the right to have the rent brake applied in areas with a tight housing market, the necessary legal ordinances may only be issued until 31 December 2020. There is still room for improvement, as Justice Minister Katarina Barley (SPD) says. In spring 2019 she plans to present a bill to extend the scheme by 5 years. The rent index is to be corrected by the fact that the leases of the last six (instead of the past four) years represent the local custom. She is satisfied with the effect already achieved, even if she admits that the rent brake alone cannot heal the market.

In the following interview she talks about the tightening of the rent brake, what else it contains and what should be improved:

The coalition partner CDU/CSU takes a critical view of the restriction of rent increase possibilities associated with the rent brake: “Interest in investments in the housing market could suffer as a result.

In any case, the rent problem cannot be denied: The fact that the popular initiative “Expropriate German Housing” is falling on fertile ground even before 20,000 signatures have been reached in Berlin is putting the Senate under pressure.

This article is a translation from the original “Berlin Umstrittene Mietpreisbremse“, which was written by Anna M .