From the Daily Tom Durning, this article from Better Dwelling describes how rampant real estate speculation has created “artificial shortages” of housing as global capitals have thousands of vacant homes sitting empty. While this “artificial shortage” does transform local home owners into cash kings, it turns cities inside out with no liveliness.
Paris in response to this vacant house epidemic implemented a tax in 2015 and is tripling it this year to 60 per cent. While trying to deal with vacant property owners over time, there are now “107,000 vacant homes, representing 7.5% of all residential dwellings in the city according to France’s INSEE. Deputy Mayor Ian Brossat told Le Monde that 40,000 of those vacant homes aren’t even connected to the electrical grid.”
Here is the interesting part-just like in Vancouver, local developers argue that more new construction is the answer. But Brossat notes “In a city as dense as Paris, where it is very difficult to build, controlling the occupancy of housing is strategic.” It appears the city believes they have 107,000 reasons more construction is not the solution”. Paris sees occupancy as being more important than adding to housing stock. The vacant housing tax did not work to reduce speculation and encourage renting, which is why the tax has increased 60 per cent. So how many empty homes are there in global cities?
“Paris’ 107,000 empty homes might seem like a lot, but it’s becoming strangely normal around the world. New York City had a whopping 318,831 vacant units in 2015. It’s a hot topic in Sydney, where 118,499 vacant units were counted in 2013. Heck, London considers it a critical issue, and they “only” have 22,000 empty homes. There’s a massive numbers of vacant homes across the globe, but only Paris has decided to take aggressive action to tackle it.”
While the amount of speculation has been scaling with demand, it suggests that the issue is s more complex than just a basic supply and demand problem. Will Paris’ high tax be enough to curb speculation and encourage rental stock?