Real estate, the main culprit in widening wealth inequalities

The mass of real estate assets in France has jumped by 233% in 20 years. An outbreak far from benefiting the greatest number of people.

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We know that income inequalities are high in France. But there is worse: wealth inequalities are “even more, and by a lot”indicated Aurélie Goin, head of the housing and heritage division of INSEE, during a press conference on October 17. Only just half of French households hold 92% of total assets (financial, real estate, professional) of the country. And if 10% of households declare less than 4,400 euros of assets, they are also 10% to report at least 716,300 euros of assets.

For the least well-off French people, “the assets are mainly made up of the car and household equipment”explains Aurélie Goin. The wealth of the wealthiest is essentially made up of professional assets, such as commercial premises or factories. As for the middle classes, their heritage lies above all in the property of their main residence.

Real estate assets have jumped 233% in 20 years

Real estate, precisely, is at the origin of the widening of wealth inequalities in France. If these inequalities have increased over the last 20 years, it is “mainly due to rising housing prices old, which have more than doubled”explains Aurélie Goin. In 20 years, the mass of real estate assets (primary residence, secondary residence, rental properties, garages, parking lots) held by French households has jumped by 233%, that is to say by 5.4% per year. on average.

This surge in prices of old residential properties, mainly at the beginning of the 2000s, mainly benefited the 70% of households with the best assets, whose real estate assets alone tripled in the last 20 yearsan increase of 4% per year. On the other hand, she does not “no way” benefited the 30% of households with the least assets, who own very few real estate assets, observes INSEE. Their heritage “has stagnated, or even declined”over the last 20 years, specifies Aurélie Goin. Remembering that France counts “only” 58% owners.

No reduction in inequalities in sight

A situation which does not seem likely to be reversed. Certainly, after having quadrupled between the beginning of 2022 and the beginning of 2024, theThe average mortgage rate fell to 3.59% in the third quarter, according to the Housing Credit Observatory published this Thursday. But it remains too high to allow many first-time buyers to finance their property purchase project. As for the drop in housing prices, a consequence of two years of real estate crisis, it risks being just a flash in the pan. Not enough to reduce wealth inequalities.