The “itchy hair” of the right continues to gain momentum. Aurélien Pradié, Les Républicains du Lot MP, is this time tackling the housing crisis, a “time bomb”, he says. The former vice-president of the party, dismissed by Eric Ciotti for his discrepancies on pension reform, is preparing to table a bill with Ian Boucard, deputy for the Territoire de Belfort. Its objective: to facilitate access to real estate loans for modest and average incomes. The latter could benefit from contribution assistance thanks to a loan ultimately guaranteed by the State. He received us this week in his office at the National Assembly to tell us more.
Why did you decide to tackle this subject?
In the midst of the crises that our country and the world are experiencing, we must not turn away from the daily lives of the French. Housing is one of those time bombs that we underestimate. The sector is undergoing a crisis which will have impacts on employment and GDP, with losses for the sector estimated at 14 billion euros by 2025. No longer ensuring our fellow citizens access to housing means sacrificing the future of our country. If we do not act powerfully today, the cost of the assistance measures that the State will have to put in place will be colossal.
Housing has always been a way to climb the social ladder. However, today, we are establishing the idea that, even if we work, we can miss this important step. This is an extremely strong social decline. And a terrible poison for meritocracy. My parents’ generation, when they reached retirement, were more than 80% owners. For my generation, it will be barely 50%. We need a real housing revolution, a real shock to access to property for workers.
What do you propose ?
Today, many French people face the difficulty of obtaining a bank loan. The main blockage is that of the contribution, which excludes the access to property of the French who nevertheless have a stable salary, but no massive contribution. When you start out in life, you don’t necessarily have money saved. The only ones who can save themselves are therefore those who have an inheritance or family support. Accession to property is on the way to becoming a form of social reproduction when it should be an opportunity for the emancipation of the middle classes.
Our proposal is clear: all those who can prove stable employment, not necessarily a permanent contract, but stable income linked to work for three years, will be able to benefit from contribution assistance through a very attractive and flexible final loan, guaranteed by the State. When you go to apply for a real estate loan, and the bank requires a significant contribution from you, either you will have a personal contribution, or the State will guarantee you the maximum possible so that the bank does not reject your application. The usual criteria for repayment capacity will continue to apply to keep things safe. But the State will be the universal guarantor of the contribution of all those who work in the country.
What are the terms of this contribution?
This will concern all types of property, new and old, as a main residence. The target will be workers who earn up to 2.5 times the minimum wage, modest to medium income. The amount of the contribution, in the form of a guaranteed loan, will be capped at 35% of the cost of the acquisition so as not to entirely replace the banks’ mission. It will decline depending on household income. This involves preserving the solidity of the files and not placing the borrower in a fragile situation. For ten years, he will only have to pay interest and insurance. At the end of ten years, the guaranteed contribution will begin to be reimbursed gradually. Or before, if he was able to save for example.
Let’s take two examples: today, a worker on minimum wage, who wishes to buy a property for 100,000 euros and who has 10,000 euros of personal contribution, cannot borrow. It’s the same case for someone who earns twice the minimum wage. If he wants to buy a home for 200,000 euros, even with 20,000 euros of personal contribution, he will be refused a loan. With our system, everyone will be able to benefit from a contribution guaranteed by the State of 30,000 euros. In both cases, they will then have access to credit.
How will the interest rate for this loan ultimately be set? Why would banks play the game?
It is the State which will negotiate it. The objective is to have the lowest possible rate, at “cost price”. We can consider more or less attractive sliders to support regional planning, depending on the needs of the areas and populations concerned. Today, the market is completely blocked. Banking organizations also need to provide real estate loans. This State guarantee will help to quickly unblock the market. It is a measure with almost immediate effects.
At a time when the right wants to reduce public deficits, isn’t that paradoxical?
The State does not disburse into this system. It guarantees, and therefore fully plays its role. Furthermore, the risk is almost non-existent. When it comes to real estate loans, there are very few defaults. Real estate loans are among the most secure. When you borrow, you have guarantees, insurance. I say this to those who, for ease, would take offense by explaining that this is not the role of the State: if we do not invest in housing, then a social and budgetary bomb is being prepared.
This type of measure has a paltry cost compared to the billions of the housing crisis. Being liberal means knowing how to intervene at the right time and invest in the future.
How many people would be affected?
The rapid and positive impact of the measure can make it possible to quickly release around 150,000 credits each year. It is the middle classes who will be massively favored.
The government has just announced the relaxation of the conditions of access to the zero-interest loan, is that not enough?
It’s a complementary solution, but it’s not up to par. It costs a lot and does not resolve the heart of the matter: access to a mortgage loan. This government is tinkering in a hurry. Faced with such great crises, we cannot rely on half-measures and technocratic adjustments. The time has come for bold action.
Have you discussed this proposal with your party? Can it be carried in the LR niche on December 7? ?
Supporting housing means supporting investment, effort and work. It is therefore an idea that corresponds to the values of my political family. If on the right we have no ideas on anything and no new solutions on anything, we will disappear. This subject can transcend divisions because everyone is aware of the coming storm. And then, I assume my role of carrying the voice of a popular right, of speaking to all those who today work hard and are no longer able to access property. For years, if the right has failed, it is surely because it has forgotten the France of work.
You are releasing your first book in November, Holding on is holding on within LR?
Not only (he smiles). It’s “holding firm” on all the major issues which, for me, are important, on the battles that I have led on disability or domestic violence. And it’s a book about my personal story. If the French know better some of my trials and stages of my journey, they will better understand where my struggles and my freedom come from.