How the 16th arrondissement became a bargain

It is a well-kept secret in Paris that luxurious properties in the well-known 16th arrondissement are no longer as expensive as they were 25 years ago, relatively speaking. Buyers have been forgoing the western part of Paris for the city center, even if that means buying smaller apartments. That means the beautiful apartments and houses in the 16th arrondissement are now a relatively great bargain.

A new trend in the luxury real estate market

As properties in the center of Paris become more and more expensive, real estate on the elegant western edge of the city remains relatively affordable. Buyers have been favoring the the 1st, 2nd, 3rd and 4th, 6th and 7th arrondissements, despite their lower supply of high-end architecture, instead of the more prestigious dwellings in the 16th. But because of the city center’s high prices, buyers have no choice but to opt for smaller properties. Large apartments (5 rooms and more) now make up only 18% of sales of high-end housing in Paris, compared to 23% in 1991. According to the notaires of Paris, the decrease in sales in 16th arrondissement, which is laden with large luxurious properties, is a likely cause of the phenomenon.

Price inequalities between East and West

One explanation for the decrease in prices in the 16th is the ongoing Grand Paris project, whose main objective is to improve transportation for the 10 million residents of the Paris region, but also seeks to overcome the price inequalities between the east and west of Paris. And since the project began, price have indeed increased more rapidly in the east than in the west.

A prestigious neighborhood

The 16th arrondissement is still a favorite for families looking for good schools, beautiful parks, and a good quality of life. The well-maintained, classic style buildings are one of the neighborhood’s many undeniable assets, which also include its proximity to the Bois de Boulogne, and the Parc des Princes or Roland-Garros. Spanning the entire west side of Paris, the mostly residential neighborhood is well known for its many “hôtels particuliers,” (or private mansions) many of which remain prestigious private homes or have been converted into museums, embassies or cultural centers.

A real bargain to be had in the 16th

Prices in the 16th arrondissement haven’t gone up much compared to other areas. In 2014, the notaires of Paris reported that prices in the 16th had only increased by 3.4% per year between 1991 and 2013, with prices doubling during the entire period. But a much lower increase than the 2nd arrondissement for example, where prices were multiplied by 3.5 times over 22 years.

Traditional neighborhoods are giving way to hipper ‘bobo’ neighborhoods, which in turn are gradually being transformed and rising in value influenced by buyers’ increased interest. The notaires’ study also suggests that price reevaluations were higher in the arrondissements that were the focus of the Grand Paris’ “reconquest of the east.”

As a result, property in the 16th arrondissement is only 1.5 times more expensive than the average price of property in Paris, compared to twice as much as the average 25 years ago.

Photo source:  Moonik