Expert Insight, Breaking News, and Insider Stories on Real Estate in Paris
Paris real estate remains a good investment in 2015
Residential real estate has traditionally been considered a good investment, and property in Paris remains so for 2015, says French weekly magazine L’Express. Several factors currently work in favor of property buyers in the City of Light.
Prices are not expected to increase significantly during the year. Overall, the figures published by the notaires (officials who handle property transactions) show there was a modest decrease of less than 2% during 2014. And some arrondissements (districts) saw a correction in prices from very high levels. Even so, prices in Paris have held up better than in most parts of France, making property an interesting mid to long-term investment.
For buyers considering taking out a mortgage, interest rates are at historically low levels. Experts have expected them to increase for the past few months, but they have continued to decrease every month.
It’s possible to borrow at a rate of around 2.4% (excluding insurance) for a fixed interest loan over 20 years, or even less if the borrower’s profile is excellent. Considering that interest rates stood at 3.1% just over a year ago, this could make a difference of thousands of euros over the term of a mortgage.
Whether buying an apartment to live in or rent out, the law of supply and demand operates in Paris particularly, where the stock of quality property is limited. This means that when owners come to sell, the demand should exist provided the property does not have flaws. And tenants are rarely hard to come by in Paris, especially if the apartment is close to a metro (subway) station. However, it pays to keep abreast of frequently-changing regulations about rental property.
Investment advisors usually recommend owning some real estate as part of a balanced investment portfolio, provided it is over the medium to long term. Renovation and other allowable costs can be deducted from capital gains tax when the property is sold.
As always, taking expert financial advice and determining your objectives before taking the plunge is strongly advised.
Credit Photo – Groume