Ihe observation is the following. The price of housing has exploded disproportionately in many territories. The reasons mentioned in Elisabeth Borne’s speech on Monday, June 5, are the costs of construction and, more recently, mortgages. Public aid, as the Prime Minister reminds us, can also have inflationary effects on housing prices.
However, an important factor is missing. The rise in real estate prices is largely attributable to the rise in land prices in the city, an observation shared by various economic studies, around 80%. The value of urban land is highly dependent on its location, ie the quality of the local environment, and accessibility to jobs and services.
The same accommodation has a very different value depending on its location. A note from INSEE pointed out that the price of a 60 square meter apartment is 90,000 euros in Provins and 780,000 euros in the 6e district, in Paris. Since construction and credit costs vary very little between municipalities, the price difference, nearly 700,000 euros, is largely explained by the difference in the value of urban land.
The negative effects of urban sprawl
The property value represents on average almost half of the value of a dwelling. This is why the accession to property by middle-class households has resulted in the sprawl of cities, in order to benefit, among other things, from affordable prices. At the same time, the government is making the fight against land take a priority reform. As part of the Climate and Resilience Law, the government wishes to protect natural areas, by establishing the objective of zero net artificialisation. This involves stopping the expansion of urbanized areas or returning to nature the equivalent of the areas absorbed by urbanization.
Our cities have been spreading out for several decades, transforming natural or agricultural soils into concrete areas for housing and travel. This urban sprawl unfortunately generates various well-documented negative effects. Soil sealing damages biodiversity and disrupts rainwater flows, promoting flooding.
The scattering of the urban population increases the distances traveled by households. If the technical progress made by car manufacturers has made it possible, in recent years, to reduce carbon emissions, the increases observed in the distances traveled by motorists have canceled out the ecological benefits of technical progress. Land take has also taken place mainly on high quality agricultural land, significantly reducing the potential for food production and carbon storage.
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