Landlords in a bind as France imposes tough new emissions rules

Michelle Bassano owns a desirable asset: a top-floor studio apartment she rents out in an almost 200-year-old building in the historic Marais district of central Paris.

But she is now thinking of walking away as the issue of trying to meet France’s strict new energy efficiency standards is proving too challenging. “It is a nightmare,” said Bassano. “I’m thinking of just selling.”

Bassano’s neighbours in the jointly-owned building refuse to ratify the roughly €100,000 needed to replace and insulate the zinc roof. Adding insulation to the stone facade outside is banned by historical preservation mandates — yet insulating the inside would mean losing precious space in the 25 square metre flat and cutting into its resale value.

Landlords across France are grappling with looming restrictions on renting out poorly insulated apartments and homes under strict new rules that phase in gradually from 2023. They aim to incentivise owners to renovate roughly two-thirds of France’s 37 million homes by 2050.

President Emmanuel Macron’s government argues that widescale renovations are needed to address a big source of greenhouse gas emissions: buildings account for almost half of French energy consumption and one-third of carbon emissions, while two-thirds of that total comes from homes. Experts say his government’s intervention is unique in Europe.

The new rules pose a particular problem for apartment buildings and historic homes like many in Paris, along with picturesque villages from Provence to Alsace. Homes in the Marais are doomed to remain in the bottom half of the government’s energy rating system even with renovations, say experts.

Critics are already warning of unintended consequences: they say the policy may worsen France’s housing shortage and could even spark social unrest as high inflation also hits households.

Jean-Claude Bassien, deputy chief executive of property group Nexity, thinks the government’s approach is the right one but…