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Real estate prices rise slightly in Paris and surrounding suburbs
With more than 42,000 homes sold in the second quarter of 2021, the market in Ile-de-France is experiencing a lot of activity. Houses are very sought after in the outer suburbs. Parisian real estate prices are rising slightly.
The movement of the Ile-de-France real estate market continues to be dynamic! Sales of older homes continue to rise, raising the prices of apartments and houses with them, properties that are highly prized by families. The successive confinements linked to Covid-19 have definitely boosted demand for real estate. “The priority of the French is to improve their housing,” says Thierry Delasalle, president of real estate statistics at the Greater Paris Chamber of Notaries. Real estate projects are taking shape all the more easily because transactions are taking place quickly, which is an advantage for buyers who are certain to sell their property as soon as possible, helping to finance part of their real estate purchase as part of a bridging loan.
A good harvest in 2021. According to the Chamber of Notaries of Greater Paris, 42,060 existing homes were sold in Ile-de-France in the second quarter of 2021, a jump of 20% compared to the second quarter of 2020, which was marked by the halt in transactions when the first confinement came into effect. This activity, which is close to that observed in the second quarter of 2019 – a very dynamic year -, should bode well, according to Thierry Delesalle: “We will have a very good harvest in Ile-de-France!”
Sales are picking up in Paris. The Ile-de-France market still offers two sides, with a lot of movement in the suburbs and slowing transactions in the capital. In Paris, 33,000 homes were sold over the past 12 months, a decrease of 1%. This figure that does not worry Marc Friedrich, a notary in Paris: “For a year, some people have been predicting a downward trend, but we don’t think so. Since September, activity has picked up strongly. There is nothing to suggest that sales will fall. We are confident.” Although Paris prices fell slightly by 0.2% in the second quarter of 2021 to €10,650 per square meter, values have been rising since May. This trend is expected to continue, with the notaries anticipating a slight increase in transactions recorded from August to October, with €10,770 per square meter. The Parisian market would thus return to the record set in the summer of 2020.
The outer suburbs are popular. The inner suburbs are attracting more and more buyers. The search for a home has prompted more than one family to move to Seine-et-Marne or Yvelines to enjoy a more spacious home and a more peaceful living environment. While prices remained stable in the first quarter of 2021, the increase was still 5 percent year-over-year, and is expected to continue, with a 7.3 percent increase expected in October 2021. While houses have always been popular in the inner suburbs, this has been less the case for multi-family housing. That situation has now changed! Individuals are also interested in apartments, which are more spacious and less expensive than in the inner suburbs, a demand that is driving up prices with an annual increase of 4%. Prices should continue to rise in October 2021, with an increase of 6%.
Rural communities in demand. While the attractiveness of the inner suburbs has not been diminished by the rise in remote work among companies, Thierry Delesalle nevertheless urges caution as to the sustainability of this new buying behavior. “This pandemic has been a trigger in the desire of individuals to change their life. It’s a groundswell that will last for several years, but watch out for the backlash! Individuals who have left with their children will return when they need to continue their education in high school.” This observation is shared by Christian Godard, a notary in Claye-Souilly, who also points out the difficulties that buyers moving to rural communities may encounter. In some of them, the shops are closed. The universities located in the Paris region are also very far away and difficult to access. “These are real issues that can create a backlash,” warns the notary.
Adapted from this article: https://www.pap.fr/actualites/immobilier-les-prix-repartent-legerement-a-la-hausse-a-paris/a22576