ABSTRACT
Price-setting was based on a governmental supply mechanism. Governmental supply mechanisms have disappeared, and today prices are set according to principles of price-setting conditions in a competitive market in which the demands are relatively price inelastic. Since the early 1980s, the second-hand market has considerably increased; the number of transactions made by households is nowadays nearly twice as many as those in the new housing market. The government's housing policy is clearly characterized by a free-market approach. The housing market in Paris is based on a nucleus of districts from which price increases spread. Property markets, including the housing market, are now deregulated, so agents who cannot pay the price fixed by the market are excluded from it. The tensions in the housing market in large cities are increasing because more and more households want to live in the town centres.
