Real estate: taxation needs a floor-to-ceiling rethink

Article published in Les Echos on June 5, 2025.

Real estate taxation in France appears as a “pure aberration” to Frédéric Cherbonnier. He is calling for a radical overhaul of property taxation to better exploit an “underutilized source” of budget revenue...

Real estate tax is a blind spot in French economic policy. By the most basic economic standards, it even seems like pure nonsense. The first obvious principle is not to tax mobility. France, along with Belgium, is the OECD country where the costs associated with buying and selling a home are the highest, three times higher than in Anglo-Saxon countries. This is partly due to the presence of transfer taxes paid to departments and municipalities, known as “notary fees,” which the government has just allowed to increase again.

In a recent study with economists Christian Bontemps and Thierry Magnac, we show that these high transaction costs prevent households from making the right choice between renting and owning. As a result, they become homeowners later in life (for fear of having to sell if problems arise) and decide not to sell their homes when their situation requires it. Ultimately, this has a serious impact on the labor market, as homeowners find it difficult to move to another region to find work...

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Illustration : photo by Veronika Jorjobert on Unsplash