Third Quarter Activity Shows Renewed Momentum

Paris apartment sales continued strong in the second half of 2025, with total volume of transactions up 12% compared to the same period last year. Cumulative sales over the last twelve months reached 27,410 transactions—5% above the same period of 2024. Transaction volume still remains below historic peaks in 2021, attributed in part to what French buyers perceive as high borrowing rates as compared with a few years ago. For Americans buying real estate in France, mortgage rates around 3.5% are relative bargains compared with US-based rates, which is why international demand remains high and continues to fuel transaction volumes in the central arrondissements. 

Market demand indicators based on search activity show strong buyer interest in Paris. Buyer inquiries have spiked to the levels of October 2021, the final month before borrowing rates began their upward trajectory and transaction volume started to decline. French mortgage rates have stabilized around 3.3% (slightly higher for non-resident buyers), after peaking above 4% in 2023. Current rates are significantly higher than the sub-1.5% rates that spoiled French property buyers in 2020-2021 – even while they are very attractive to US-based buyers who are seeing rates at 5+% at home. The current pace of activity suggests Paris is stabilizing at what may represent a new baseline for market transactions.

Prices Hold Near Recent Highs, Varying Widely across Arrondissements  

Prices remained relatively stable, with an average of €9,700/m2 citywide, up 1.9% compared to the third quarter of 2024. The notaires’ advance indicators, which analyze signed pre-contracts that typically convert to completed sales within two to three months, project prices holding near 9,700 euros per square meter in January.  This is a welcome respite from the significant volatility in 2024, during which average Paris prices fell 5.5% from the year before. 

Price variation across Paris’s geography continues to be substantial. Third quarter data show prices averaged from 6,780 euros per square meter in the La Chapelle quarter of the 18th arrondissement to 15,850 euros in the Notre-Dame area of the 4th. The best properties in the highest-priced neighborhoods— primarily the 4th, 6th, 7th, and 8th arrondissements—command prices at €20,000 euros per square meter and more. 

Price movements during the past year varied considerably across Paris’s twenty arrondissements. More than half of the city’s districts recorded price increases on an annual basis, though the magnitude of gains remained mostly modest.

The 6th arrondissement led appreciation with select quartiers posting gains approaching 9%, while the 14th arrondissement recorded advances near 5%. In contrast, the 18th arrondissement experienced the steepest declines, with some quartiers falling more than 6% year-over-year. The 7th and 17th arrondissements showed mixed performance, with certain areas declining while others posted modest gains.

Central arrondissements with the highest absolute price levels have generally shown more resilience than peripheral areas. The data suggest that Paris’s most expensive neighborhoods maintain pricing power due to limited supply and sustained demand from high-net-worth and international buyers, while more affordable areas face greater pressure from financing constraints that reduce the pool of qualified purchasers.

Political and Economic Uncertainty Weighs on Investment Activity

The Paris market continues to operate on a backdrop of confusion on fiscal policy and regulatory requirements. November brought a succession of often contradictory fiscal proposals affecting property owners, including reforms to capital gains taxation, potential transformation of the wealth tax (IFI), extension of enhanced rental expense deductions, and more.

This uncertainty has been compounded by a tense political and budgetary climate, including a humiliating rejection of the government’s finance bill, and a protracted battle to raise the national retirement age. In this environment, both buyers and sellers have adopted wait-and-see strategies: sellers postpone selling decisions while potential buyers hold back, waiting for clearer signals on both taxation rules and interest rate trends. The notaires note in their analysis that absent clearer signals on taxation and financing costs, the market is likely to remain in its current rhythm through the winter months, with potential for renewed momentum if spring 2026 brings improved visibility and sustained rate stability.

Outlook Points to Continued Stabilization 

The Paris property market enters 2026 with a tentative equilibrium. The pattern observed during recent months—gradual volume recovery paired with price stabilization—appears likely to persist through the early part of the year. Whether this represents a durable new baseline or a temporary status quo before further movement will depend largely on factors like interest rate policy and political stability.

Contact Paris Property Group to discuss current market conditions and opportunities in Paris’s residential property market.