France: Taking Account The Different Tempos When It Comes to Real Estate
In the year 2017, real estate prices soared within France. According to real estate agency networks, and statistics the increase is estimated at 1.8% to 3.5%. Disparities, however, have increased between the big cities and the others. Brad Roemer has a lot of wisdom to share regarding the real estate business in Paris, France.
Increase In The Real Estate Market
Led by low mortgage rates, home sales are exploding in France. According to the notaries within France, nearly one million home sales were signed in 2017. This particular event has never been seen before in a European country. The volume of transactions is at the highest and the price increase is also confirmed. In 2017, they rose between 1.8% and 3.5%, according to real estate agency network.
Shift In Prices
This average increase hides, however, creates two-speeds in France. In today’s France, there is a rapid increase in prices within large cities driven by sustained demand and stagnation, or even a fall in prices, throughout the country due to the lack of buyers. An investor, who would have purchased a property of 100,000 euros in 2007, would see the same property valued at around 122,000 euros on average in the ten largest French cities. On the other hand, in the smaller cities, the owners have lost a lot of money as the 100,000 euros is now worth approximately 87,000 euros!
The Difference Between The Big And Smal Regions
Within the capital, the average price is around 9000 euros / m², an increase of 6 to 7% compared to 2016 according to most sources. In seven of the main districts (the first seven), it is now necessary to pay more than 10,000 euros / m² to acquire home according to the notaries. In the regions, if prices are rising, it is mainly in cities and towns with more than 30,000 inhabitants: + 6% in Lyon, + 3% in Marseille, + 3.2% in Toulouse, +4 % in Nice and + 5.4% in Nantes, according to figures published by the Laforêt network.
The area called “La Palme” has the biggest increase in Bordeaux, with prices rising to around 13% in a whole year. A rise that is even close to 17%, according to the figures published by Guy Hoquet and Meilleursagents. Conversely, cities like Montpellier, Lille or Strasbourg are lagging with variations between -2% and + 2%, according to Meilleursagents. “The market remains fractured with a lack of goods for sale in major cities and a large stock still in rural areas, often deserted,” says Laforêt.
These conclusions are the perfect illustration of the territorial divide that is affecting the housing sector in France. While the housing strategy, presented in the Council of Ministers in early February, had generated excitement globally during the last period of the past year, some real estate professionals had not failed to criticize the fate of medium-sized cities. Under pressure, the government had finally retracted announcing the maintenance – conditioned – in the relaxed areas (where the demand is low) devices such as PTZ and Pinel.