Housing tax: city by city, here is how its return would increase your real estate budget

While the housing tax was eliminated between 2018 and 2023, local elected officials are calling for its return as part of the draft budget for 2025. A return which could put many property owners in difficulty, according to simulations carried out by Meilleurtaux.

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Barely buried, already resurrected? Gradually eliminated between 2018 and 2023, the housing tax on main residences could make its return in the finance bill (PLF) for 2025, currently being examined by Parliament. While this draft budget requires five billion euros in savings from local authorities, several local elected officials are calling for the return of housing tax on main residences, from which they benefited.

“The big mistake of (Emmanuel Macron’s) (first) five-year term was the abolition of the housing tax (…). If we have to recreate a tax, this is it»recently estimated the LR mayor of Meaux, Jean-François Copé. An opinion shared by LFI MP David Guiraud, who tabled an amendment to the PLF 2025 in order to restore the housing tax on main residences for the 20% of richest households.

A “residency tax” for all but the poorest?

Certainly, the Minister of Public Accounts, Laurent Saint-Martin, and the Minister of Partnership with the Territories, Catherine Vautrin, have brushed aside a possible return of the housing tax. But this little music continues to be heard, the Association of Mayors of France asking for example to “think about a citizen contribution to public service”. Jean-François Copé imagines for his part “a residence taxwhich would concern everyone except the most modest”.

If, by chance, the housing tax were reborn from its ashes, what would be the financial consequences for property owners? Meilleurtaux has just published a simulation in around thirty cities, based on an amount of housing tax identical to that of the property tax. Let’s take the example of a household which has acquired a 70 square meter dwelling in Saint-Etienne (Auvergne-Rhône-Alpes), where the average price per square meter does not exceed 1,376 euros, and for which it is pays a monthly loan repayment of 571 euros, based on a rate of 3.75% over 20 years (excluding insurance). In 2024, this household paid 1,225 euros in property tax. If he had also had to pay housing tax, for a similar amount, he would have paid a total of 2,450 euros (1,225 euros x 2) for these two local taxes. That’s a 100% increase!

3 or 4 additional monthly credit payments per year

An amount which represents 4.3 times your monthly loan payment of 571 euros, as you can see in the table below. “The overall impact of the property tax and the housing tax differs depending on the city. In fact, the less expensive real estate is, the higher the tax burden. This is the case of Saint-Etienne, where these two taxes would represent, if the return of the housing tax were adopted, the equivalent of four additional monthly credit payments per year. !”, exclaims Maël Bernier, spokesperson for Meilleurtaux.

If you are an owner in Nîmes or Perpignan, you will not be much better off than the people of Stéphane in the event of a return of the housing tax. With the price per square meter barely exceeding 2,000 euros in these two cities, the sum of the housing tax and the property tax would represent 3.5 times the monthly loan payment of a household having purchased a 70 square meter there. In Le Havre, Mulhouse, Le Mans and Limoges, the rebirth of the housing tax, coupled with the property tax, would be equivalent to the payment of three additional monthly credit payments per year for property owners.

The return of housing tax would put many owners in difficulty

The weight of the housing tax and the property tax turns out to be much lighter in cities with high property prices. Starting with Paris and its 9,259 euros per square meter. Let’s return to our example of a couple who bought a 70 square meter apartment, this time in the capital. Still on the basis of a mortgage rate of 3.75% over 20 years, he repays 3,843 euros per month to his bank each month. In 2024, he paid a property tax of 1,247 euros.

If he had also had to pay housing tax, he would have paid a total of 2,494 euros (1,247 euros x 2). A sum which represents only 0.6 times your monthly loan payment of 3,843 euros. But, of the 32 cities studied by Meilleurtaux, Paris and Aix-en-Provence are the only ones where the return of the housing tax, associated with the property tax, would represent less than one additional monthly credit payment per year to pay. For many households, therefore, the resurrection of the housing tax could “be extremely impactful, with some owners potentially finding themselves in an extremely delicate financial situation”worries Maël Bernier.