Real Estate Update: September 2020

Property prices in Paris reached an average of €10,690 per square meter in the second quarter, according to notary data, and are expected to reach €10,860/m² in October.

After “six weeks of total quarantine and a collapse in sales,” when real estate activity in the capital decreased by 32% in comparison to the 2nd quarter of 2019, Paris notaries are now talking of “a recovery in activity, quickly returning to levels comparable to the beginning of the year.” According to them, this is a “promising sign” for the industry, as the pandemic has highlighted “the role of housing as a safe investment” as well as “the importance of being well housed”. This is all the more favorable as mortgage rates remain low.

According to notary data, the average price per square meter in the second quarter of this year reached €10,690.  An increase of 8% year-on-year, this figure represents an increase of “only” 2.1% over the last three months, which could be enough to slow annual growth down the line.  According to preliminary contracts, notaries predict an annual price increase of 6.6% in October and an average price per square meter of €10,860.

Despite this, three arrondissements witnessed double-digit annual growth: the 20th (+12.2%), the 7th (+10.5%) and the 12th (+10.2%). In the first quarter, only the 12th arrondissement had exceeded this symbolic 10%. Conversely, Paris’s least dynamic arrondissements were the 9th (+ 2.1%) and the 6th (+ 4.2%).

Prices

The 6th, however, is the capital’s most expensive arrondissement, with an average price per square meter of €14,430.  On average, a 50 m² apartment in this neighborhood is sold for nearly €720,000. The capital’s other central arrondissements fall next in line: the 7th (€14,200/m²), the 5th (€12,780/m²), and Paris Centre (arrondissements 1 through 4) at €12,750/m².

At the other end of the spectrum, the 19th is the last arrondissement in the capital with an average price per square meter less than €9,000.  Its average €8,930/m² is 38% cheaper than the average in the 6th. Only five arrondissements still have average prices below €10,000 per square meter: the 19th, the 13th (€9,390), the 20th (€9,400), the 12th (€9,900) and the 18th (€9,990).

The most accessible neighborhoods are le Pont de Flandre (19th, €7,870/m² ) and la Goutte-d’Or (18th, €8,550/m² ), while the most expensive are Odéon (6th, €17,130/m² ) and the Champs-Elysées (€16,350/m² ).  “Odéon is more than twice as expensive as Pont de Flandre, with €9,260 per square meter separating them. This figure has already exceeded €10,000 on several occasions (in 2011, 2013 and 2015). It had fallen to €7,000 at the end of 2016,” notaries remarked.

Sources: UN «EFFET COVID» SE DESSINE SUR L’IMMOBILIER EN RÉGION PARISIENNE; A PARIS, LES PRIX IMMOBILIERS S’ENVOLENT DE 8% EN UN AN ET VONT CONTINUER À GRIMPER