In Part 3 we explain why it is important for Nice to implement the new law.
It is now clear the purpose of the Loi ALUR is to prevent illegal lettings and stop tax evasion. Nice has its fair share of web portals and property rental websites where the owners (and often companies) disregard the law.
In France, all agencies must operate with a carte professionelle if taking any commission or managing any property. Most agencies do not carry this. Due to the rapid growth of property rental websites like Airbnb, everyone’s spare rooms are being turned into budget holiday rentals – where prices are kept low thanks to no taxes.
Hotels and properly regulated agencies across France are up in arms that they are forced to follow rules and regulations, whilst some private owners are able to price them out of the market because they have none of the same overheads, and are not giving back to France.
France agrees and is now fighting back. France is known to be the most aggressive tax collector in Europe, and the Loi Alur offers the means to control this locally. If Nice does take a firm grip on the unregistered owners not paying taxes, eventually our marketplace will look very different. We anticipate this may take about 3 years, but for owners working with a proper, registered French company who pay their taxes, the Loi ALUR only means good news.
There will be fairer competition, and possibly no competition from the frustratingly low priced apartments. The fight against owners using sites like Airbnb has already been seen across Paris. Law enforcers have removed scores of illegal Airbnb apartments where owners are breaking the new law along with those leaving decomposing bodies in the garden.
A word on the fines for those caught:
- It is 25,000€ per apartment that hasn’t applied for change of use (yes, you read that correctly).
- An additional 1,000€ will be taken for each day that the apartment is rented (again, you read that correctly).
Fines will be collected by the Mairie and go straight into Nice’s budget. Nice’s debt currently stands at around 500 million euros, so this will be very welcome.
In response to tough questions being asked about Nice’s debt, the first deputy mayor Philippe Pradal said “A number of corrective measures” have taken effect in 2015 and will do so even more this year. We think this is one of those corrective measures.
If properly implemented and stringently regulated, the new rules will bring in millions of euros in tax each year. This is taken at local government to be spent on local projects. If the tax collected is spent wisely, then the city will appeal to tourists even more.
Nice has already undertaken vast improvement works in the last five years, including the demolition of the bus station (now thankfully a distant memory) and building a greener, more beautiful city than ever. Nice will soon offer a more attractive Promenade des Anglais and Promenade du Paillon park. All part of the promise is to establish a green belt through the city with the plantation of 1,700 trees and multiple new parks. He’s done well so far, but it’s not been cheap.
So how is our Mayor of Nice going to spend the money he’ll continue to collect for years to come? Find out in Part 4.