In Paris real estate goes “from frenzy to reason”

The market slowed down in the capital at the end of the year, not considering the success in the small crown and the large crown. Everything, starting with the buyers, has changed.  The Paris real estate market ended up suffering the expected slowdown. The number of sales fell by 3.2% between the third quarter 2020 and the third quarter of 2021, according to Century 21. As for the average price, it stabilized at 10,500€/m.   Parisians take the time to think before buying.

Real estate prices in Paris, arrondissement by arrondissement

Since the start of the school year, the Parisian market has been at two speeds. “Faced with more abundant choices, buyers become more difficult and hesitant,” observes Richard Tzipine, the managing director of Barnes. Retractions are also more numerous. And the amplitude of prices increases sharply: the quality properties remain at high prices, while the first dark or poorly maintained floors can drop by 10% to 20% – “a discount that sellers are still struggling to accept,” notes Richard Tzipine. Similarly, “many family apartments only sell in the event of a price drop”, observes Sébastien Kuperfis, the executive director of Junot.

Family apartments in Paris

As for the high-end market, it is boosted by the return of expatriates to France: “Some have been burnt by a long confinement abroad, far from their families, others settle in Paris following Brexit”, notes Nicolas Pettex-Muffat, CEO of Daniel Féau. The foreign buyers are gradually returning. But, for the most part, the market is bustling with French buyers mainly from finance, technology and wealthy liberal professions.

“For good prices discover unsuspected nuggets: houses, old warehouses, workshops…”, underlines Geoffroy Reins, at Espaces atypiques. Frank Roiena, from the Dauphine Rive gauche agency, explains: “Compared to residential sectors, where, given the price level, many buyers are waiting, the market in trendy neighborhoods is more toned. Firstly, because the prices are lower there. Next because the location matters: buyers favor neighborhood life compared to the sometimes mediocre quality of the construction…” 

387,877€ for a house in Ile-de-France 

Ile-de-France is following a trend comparable to the national evolution: again according to Century 21, average prices per square meter increased by 5.3% for houses (3,420€/m2) and 7.6% for apartments (4,605€/m ). An increase which has already resulted in a fall in activity (–22.1% in one year for houses and – 21.6% for apartments). It must be said that the average amount of an acquisition in the Ile-de-France region reaches unequaled levels: 387,877€ for a house and 261,760€ for an apartment, which effectively excludes some of the potential buyers.

“A large part of the potential demand is excluded from the market”, explains SeLoger. Added to these difficulties are the uncertainties about the rebound in the pandemic and the upcoming presidential election, which fuel the wait-and-see attitude of a number of buyers and sellers. All of this explains why the market is hesitant in this pivotal period, even if the stone remains a safe haven. 

Source:  Nouvel Obs