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The impact of the 2014 increase in the real estate transfer taxes on the French housing market

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  • Guillaume Bérard
  • Alain Trannoy

Abstract

[eng] This paper estimates the effects of an increase in the share of the real estate transfer taxes (RETT) going to the French départements from 3.80% to 4.50%. Not all the départements voted the RETT increase on the same date, which is the starting point of a natural experiment. Using a difference-in-differences design, we estimate two main effects. (1) An anticipation effect, one month before the implementation of the reform, in order to avoid the RETT increase. (2) A retention effect in the post-reform period. In the end, the net effect (retention minus anticipation) corresponds to an average drop in transactions of around 6% over the first three months after the reform, that is, approximately 15,000 transactions lost at national level. If we find a short term effect of the reform, we do not find evidence of a medium- or long-term effect.

Suggested Citation

  • Guillaume Bérard & Alain Trannoy, 2018. "The impact of the 2014 increase in the real estate transfer taxes on the French housing market," Economie et Statistique / Economics and Statistics, Institut National de la Statistique et des Etudes Economiques (INSEE), issue 500-501-5, pages 179-200.
    • Handle: RePEc:nse:ecosta:ecostat_2018_500-501-502_10
    DOI: https://doi.org/10.24187/ecostat.2018.500t.1951
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    Cited by:

    1. Bello Musa Zango & Sanni Mohammed Lekan & Mohammed Jibrin Katun, 2020. "Conventional Methods in Housing Market Analysis: A Review of Literature," Baltic Journal of Real Estate Economics and Construction Management, Sciendo, vol. 8(1), pages 227-241, January.
    2. Denis Fougère & Nicolas Jacquemet, 2019. "Causal Inference and Impact Evaluation," Economie et Statistique / Economics and Statistics, Institut National de la Statistique et des Etudes Economiques (INSEE), issue 510-511-5, pages 181-200.
    3. Bev Dahlby & Braeden Larson, 2019. "Should Alberta Adopt a Land Transfer Tax?," SPP Research Papers, The School of Public Policy, University of Calgary, vol. 12(5), February.

    More about this item

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
    • R51 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Finance in Urban and Rural Economies

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