Trumpeted – forgive the pun – as the sequel to Brexit and the US Presidential Elections, to what extent could the French Elections this Spring change the property market in the Alps?
Before the race has even started, there is debate as to who is still left in. The French TV channel ‘TF1’ electoral debates in March will only include those with more than a 10% stake in the polls, which rules out all but five hopefuls: François Fillon, Benoît Hamon, Marine Le Pen, Emmanuel Macron and Jean-Luc Mélenchon.
The media has so far tended to concentrate on which of these candidates are the more left or right wing, but to do so is both unhelpful, and a little simplistic. Marine Le Pen’s policies on immigration may be predictable enough, and they include, for example, an extra tax on the employment of all foreign nationals, but she is also keen to assist small businesses and to reduce the tax burden overall.
From the left, Benoît Hamon and Jean Luc Mélanchon share an anti-austerity platform, and both wish to reduce the infamous 35 hour working week. But the younger of the two, Hamon, would also like to legalise cannabis, whereas Mélanchon would rather concentrate on a new 100% tax on any earnings over 360,000€ and a 20% hike in the minimum wage.
If it weren’t for his Welsh wife apparently dipping her hands in the till, François Fillon would perhaps have been ahead in the polls, offering, as he does, an antidote to a succession of largely socialist governments of recent years. His policies will resound sympathetically on foreign ears: slashing taxes; cutting benefits; axing 600,000 state-paid functionaries and reducing taxes on all companies, both large and small. But credibility also matters in this election, and he has largely lost face with even the most sympathetic French voter.
This leaves the maverick of the group: Emmanuel Macron – just 38 years old. He rose to the political forefront as Economic Minister in François Hollande’s government, but unable to secure a party mandate, he invented his own political movement, ‘En Marche!’ – or ‘Moving Forward’, which describes itself in terms of ‘compassionate liberalism’. The policies are mixed: from scrapping the 35 hour working week and making it easier to fire employees to offering employment benefits to the self-employed.
At this point in the hustings, few candidates have put forward policies that specifically impact on the property market. However, François Fillon will abolish the wealth tax (ISF), which may help to encourage high worth individuals to invest in France. More than this, it is the policies that impact more generally on the economy as a whole that will determine how the property market develops.
Zooming in to foreign ownership in the alpine region of France, it is true to say that there are very specific influences on the property market here that rise over and above the presidential elections. They include the strength of the Swiss economy and the influx of foreign nationals across the world, whose wealth is largely immune to the vagaries of the French political system.
Following Brexit, there has been a good deal of speculation on a potential referendum on French EU membership, particularly if Marine Le Pen is successful at the polls. But let’s not forget that the French have been here before. On 29th May 2005, they voted ‘no’ to the EU constitution with a majority vote of 55%. The result? The government of Jacques Chirac simply chose to ignore the mandate (or lack of it), and pressed on with closer European integration regardless.
And it’s important not to forget that the presidency of Nicholas Sarkozy (one of the few right-wing Presidents of recent years) in 2007 was heralded as a step-change from the past. Like some of the presidential hopefuls ten years on, he had sort to unburden business and lift the economy out of its flat-line state. But he found himself strangled by political manoeuvrings, an unfriendly parliament and down-right hostile unions. He ended his term in the doldrums, and was unable to rekindle any support for a political come-back.
Will a similar fate await the next batch of candidates? For all their dynamic policies, will whoever is elected manage to see their dreams come to fruition, or will the French talent for political inertia override?