2017 has been a strong year for property in France, with record-setting levels of sales overall. In the French capital, prices have continued to climb too and should reach €9,190/m² in January, according to current previsions.
According to the latest report by the notaires (solicitors) of Ile-de-France region (essentially, greater Paris, representing close to 20% of the total French population), the price of property in and around Paris will continue to rise for the foreseeable future. Despite the general calming of price increases being seen elsewhere in the country, second-hand homes in Paris have hit the €8,940 mark in September. Going by pre-contract deals currently being processed, this figure will reach €9,190 in January.
In the third quarter of 2017, the annual volume of sales of dwellings in France reached a historical record of 952,000 (compared to 825,000 in the same period of 2016). In the same period, the increase in average values accelerated to 3.9% from the 3.1% figure a year previously. In Ile-de-France, property sales were particularly brisk (up 12% on the same period last year) with annual growth becoming more pronounced the closer one got to Paris itself, where average values are well above the national figure. Average apartment prices in Greater Paris, for example, jumped by 5.8% while within the city boundaries, that figure was 7.8%. The evolution of house prices was a lot less dynamic – just 2.7% up on last year’s figures.
“In Paris, there isn’t any reason to suggest that value increases won’t suddenly stop happening,” says Thierry Delesalle, a Paris-based notaire. According to the lawyer, the conditions are still in place for price increases to continue: “Supply is still short, interest rates are still as low as ever and the length of home loan terms being offered is increasing.”
The “Brexit Effect”
Apart from the strong vital statistics of the Parisian market, two more factors are in play, both of which are expected to play their part in boosting demand further:
One is the strongly-predicted return of wealthy expatriates re-locating from London as a direct result of Brexit. This army of well-heeled financiers flocking back to the capital of their homeland are expected to have a considerable impact on property prices at the upper end.
The second factor is that of the return of foreign buyers in general. In the aftermath of the shocking terrorist attacks in Paris over the last few years, the market share of foreign buyers in the Parisian property scene fell to 6.9% from a figure of around 10%. The gradual softening of the trauma, coupled with the market-positive “Macron effect” seems to be having an increasingly positive effect on the market, according to the analysts.
While we may think of our property market as galloping ahead beyond control, it’s sobering to realise that the average price per square metre in Dublin is around €5,500 in Dublin 2 for 2-bedroom apartments and 3-bedroom semi-detached houses and €7,000 for four-bedroom apartments in the most sought-after district of Dublin 4.
In Paris, the “standardised” average price per metre (a new method of calculation used in the above map and following the most sold type of property over a given period) doesn’t drop below the €8,000 mark in all but two arrondissements – the 19th and 20th in the northwest of the city. In the more sought-after ones, the price tends to average around €12,000/m²: €12,200 in the 6th; €12,010 in the 7th; €11,670 in the 4th and €11,420 in the 1st. If you want to get in on the Parisian property ladder at the moment, there are only three districts where the average still under €7,000/m²: La Chapelle (18th-€6,760/m²), Pont de Flandres (19th-€6,810/m²) and La Villette (19th -€6,970/m²). At the other end of the scale, the most costly districts have now gone over €14,000/m². These swanky addresses are: Thomas-d’Aquin (7th-€14,650/m²), Invalides (7th-€14,360/m²) and Odéon (6th-€14,120/m²). The highest price per square metre paid for a residential property in 2017 was for an apartment in the Champs-Elysées district, which cost the lucky owner some €37,800/m².