According to the author of the report, Michel-Edouard Ruben, tax incentives should be reintroduced to boost investments in rental properties, supporting investors who might in turn help tenants by asking for lower rents.
He believes that government aids should be bound to clear conditions, including temporarily limited caps on rent, as this would allow lower-income households to have access to a wider supply on the rental market. This would also avoid the risk of a housing shortage due to a decrease in sales and construction, says the economist.
Owners who want to buy a property to live in should also be able to benefit from public aid, according to Ruben, who proposes a simple idea already in use in the Netherlands: abolishing registration fees for people under 35.
Ruben believes that a fall in property prices is undesirable since “it would take us from a housing crisis to a real estate crisis. Thinking that a fall in property prices will increase the purchasing power of households is like a person trying to lose weight by cutting off an arm.” He thus points out that if prices fall every quarter, the sector will no longer be attractive to investors.
There is no miracle solution to the housing crisis, but Ruben argues that a series of measures and better collaboration between the public and private sectors might lead to long-term changes. Renting should clearly be prioritised, both in the public and private sector, says the economist.
Read also: Steep rise in rental cost as draft law awaits amendmentRead also: Eurostat - Rate of housing cost overburden higher in EU citiesRead also: CSV - Housing in Luxembourg heading in “potentially dramatic direction”
