Energy-inefficient properties in France are selling at steep discounts as rental market restrictions force owners to offload homes that can no longer be legally let, according to data released by French notaires in December.
Properties rated E, F or G on France’s energy performance diagnostic (DPE) accounted for 40 percent of all transactions in the existing housing market in 2024, according to a study on “green value” presented on 8th December during the notaires’ annual review.
Houses rated G sold on average 25 percent cheaper than those rated D, which notaires use as the reference category. For apartments, the discount stood at 12 percent.
Rental restrictions drive sales
Sales of energy-inefficient properties, known in France as passoires thermiques (thermal sieves), have surged since 2021 as regulatory changes have progressively restricted their use in the rental market.
Since 1st January 2025, all properties rated G on the DPE are considered substandard and can no longer be offered for rent, whether for new leases, renewals or tacit continuations of existing contracts. Properties rated F will face the same restriction from 2028, with E-rated properties following in 2034.
The tightening regulations have created a wave of sales as landlords exit the market rather than undertake expensive energy efficiency renovations. These properties, which can no longer generate rental income, now constitute the largest share of homes being sold.
The data covers the French property market as a whole. Monaco, which has its own building regulations and energy standards, follows different rules regarding property energy performance and rental restrictions.
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Photo credit: Cassandra Tanti