Paris Real Estate Market Shows Signs of Price Increases After Long Decline

After experiencing a slow but steady decline that saw property prices fall approximately 10% since summer 2020 due to COVID-19’s impact, early 2025 data suggests an impending price increase in the coming months, marking a significant shift in the market’s trajectory.

January 2025 marked the first upward trend in Paris real estate prices in nearly five years. Though modest—a 0.7% increase over three months and 0.5% year-over-year—this shift could signal the end of the buyer-friendly market that has characterized recent years.

Market Activity Surge

Recent months have seen a notable increase in buyer activity, largely attributed to falling interest rates. Banks are now offering rates around 3.5%, down from recent peaks exceeding 4%, creating favorable conditions for borrowers. This environment has particularly attracted first-time buyers who don’t have existing properties to leverage for their purchases.

Real estate professionals report a significant uptick in property viewings and inquiries, with prospective buyers demonstrating greater financial confidence. Price negotiations have narrowed from the previous range of 5-10% to just 3-6%. Transaction speeds have also accelerated, reflecting strong demand among Parisians. This increased demand naturally puts upward pressure on prices.

A Measured Increase

Despite these trends, potential buyers should not be worried and can approach their search systematically as always. Market experts characterize the current situation more as price stabilization rather than the end of the declining market. What’s more, the modest average increase doesn’t apply uniformly across all property types: new or fully renovated properties may be less willing to negotiate, while properties needing bigger renovation or updating are likely to continue to see buyers negotiating more aggressively on price.

Interestingly, this price recovery primarily affects Paris’s more affordable arrondissements. If this trend continues, it could lead to reduced price disparities between different neighborhoods rather than a widespread surge in costs across the capital. In the past, when that has happened, the more desired and more expensive neighborhoods start to creep up in response, since they are more highly valued and they start to seem underpriced.  Given the combination of relatively affordable prices and declining interest rates, potential buyers might want to act sooner rather than later.