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RE2020: Beware of the surge in new real estate in 2022!

Posted by Michel on January 29, 2022

The cost of building has a significant impact on the value of a new home. The requirement to create housing that is more and more energy and equipment efficient explains the constant growth in new building costs. According to construction specialists, the RE2020’s coming into effect on January 1, 2022, will result in a further considerable rise of roughly 5%. Concentrate on these new requirements and their potential influence on home prices.

The objective of the RE2020 standard

In order to minimise dilapidation and counteract climate change, legislation is becoming more engaged in the rehabilitation of French property. Housing of the future will need to be more robust and cost-effective, while simultaneously meeting an increasing desire for comfort from owners, which will benefit renters.

Simultaneously, it is an issue of directly decreasing housing’s environmental effect by lowering its energy requirements. When we consider that housing consumes the majority of energy in France (45%), considerably outnumbering transportation (31 percent). It also accounts for 25% of the country’s greenhouse gas emissions.

To go along with the ever-stronger legislative responsibilities that have been in place for decades, the most recent being the restriction on term rentals of housing classed E, F, and G imposed by the Climate and Resilience legislation issued in 2021, it seems appropriate to raise the bar on the criteria in the nine. This guarantees that the needs of today’s residents are satisfied, as well as avoiding the construction of new homes that will need to be updated too often to keep up with future advances.

Five key measures to strengthen RT2012

In terms of the requirements that are clearly defined now, the RT2012 has certain flaws. RE2020 aims to provide a fresh perspective on building via 50 articles that span 1830 pages and mostly explore the progression of processes. There are five important indicators whose effect explains the change in the cost of creating new dwellings.

#1 Reducing energy needs

Insulation is prioritised in order to obtain a suitable outcome in terms of the given goal. Better airtightness, better insulation layers and materials, and more efficient glass are all on the agenda, as is taking use of the sun’s and light’s natural contributions as “free” heating. We anticipate a 20 percent to 30 percent energy savings as a result of these points, which will also have an impact on the comfort of living inside the home.

#2 End of reign for fossil fuels

The majority of new residences will be equipped with wood-fired heaters, next-generation electric radiators, or heat pumps. Gas heating is presently restricted in new single-family dwellings, and from 2025, it will be prohibited in communal housing and the tertiary sector. This action corresponds to the governmental commitment to attain carbon neutrality by 2050.

#3 Decarbonization of the materials used

Manufacturers must research the influence of the products they use on the environment. Concrete, in instance, which emits considerable amounts of carbon throughout its manufacturing, transportation, and end-of-life in buildings, might contain less cement and have a reduced carbon footprint. It’s also a matter of prioritising sustainable resources like wood and natural insulation (cork, hemp, cellulose).

#4 Taking summer comfort into account

Summers are becoming more hot, which is terrible news for the goals of lowering building energy use, to the point that the cost of air conditioning may soon compete with the cost of heating in certain areas! New structures may avoid the need for air conditioning by using right orientation, sun protection, or an efficient ventilation system, just as they can keep freshness longer by using suitable insulation.

#5 Encourage local energy production

Increasing the efficiency of all of the preceding items necessitates having access to green, local, and inexpensive energy. If the RT2012 supported limiting a dwelling’s energy usage to 50 kWh/m2/year, the RE2020 encourages the development of “positive energy” structures, which create more energy than they use. Solar panels seem to be virtually vital in this context, since energy consumption are not expected to decrease as a result of the widespread adoption of home automation in particular.

All of these steps will have a considerable influence on building costs this year, justifying a large rise in selling prices.

A price increase differentiated according to the type of accommodation

Individual housing is more difficult to absorb the expense of the RE2020 regulations, hence individual housing should see a larger price rise than communal housing.

As a result, it is expected that the new criteria, which will apply to all construction permits submitted after January 1, 2022, would raise the price of a new apartment by 4% to 5% and the price of a new home by 5% to 7%.

What makes a purchase more difficult to finance, when the LPI-Seloger Observatory reports that new construction costs have already grown by 1.4 percent in 2021 and by 4% in 2020!

Materials Prize Competition

It is no longer a secret that the costs of several commodities are skyrocketing, owing in part to the pandemic and the production halts it has caused, as well as different shortages.

If builders and developers do not lower their margins, the cost for certain houses might climb until it rises by between 15% and 20% in 2022, potentially affecting the end buyer.

If the development of housing quality and adaptability to climatic circumstances is a need, the cost difference may deter many consumers from choosing new, which is already 15 percent to 20% more costly than an old commodity. However, this extra fee must be considered against the costs of a refurbishment, which may be necessary in the case of a rental investment. One thing is certain: the look of new real estate will alter!

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