Paris property prices drop as buyers’ priorities shift

Real estate prices fell in Paris last month, with an expert suggesting the capital’s attractiveness weakened as buyers’ priorities shifted during the pandemic.

In its latest market barometer, the real estate site Meillagents indicated that the average price of real estate in Paris had stopped increasing and had even fallen by 1% last month (November 2021).

Barbara Castillo Rico, head of scientific research at Meilleuragents comments: “Paris no longer attracts buyers looking for space, greenery and purchasing power, causing prices to slow down by around 3.4%. in just 14 months.

Real estate in Paris is still expensive. However, the data suggests that the prices are generally quite stable. In December 2021, prices ranged from € 9,455 per square meter in the 19th arrondissement to € 15,305 in the 6th.

Only three districts, in the 13th, 19th and 20th arrondissements, have prices below € 10,000 per square meter.

Lower bid prices

Realtors have said buyers are more picky and take longer to discuss prices, especially for properties that need work. A three-room apartment, marketed at 550,000 € in the 13th arrondissement, received offers of 500,000 €, or 10% less than the asking price.

Thomas Venturini, founder of online real estate agency Liberkeys, said the changes particularly affect “overvalued” properties.

A “two-speed” market

For Sébastien Kuperfis, director of the Junot real estate agency, “a two-speed market” is taking hold.

He said: “On the one hand, well-located bright apartments with a balcony or terrace can sell for one day at asking price, while others can stay on the market for a year.”

He specifies that for high-end apartments, there has been no drop in price, because “buyers are ready to invest large sums for well-located apartments with impeccable services, of which there are very few. in Paris “.

Reasons for the change: short-term rentals, power and city theft

There are fewer apartments being used in the short term, as the pandemic has affected tourism, and stricter rules on platforms like Airbnb mean investors are no longer as interested.

This influx of small apartments has reduced demand and affected prices.

Likewise, fears over energy certificates create uncertainty in the market.

The real estate site SeLoger reported that between September 2020 and October 2021, the number of homes listed with an E, F and G energy label jumped 74% in Paris compared to September 2019 and October 2020.

The new energy law, the Climate Law, will ban the rental of housing classified G from 2025, F from 2028 and E from 2034.

Affected owners who wish to keep their properties on the market will need to make the appropriate changes before these dates.

Read more: Shopping, driving, home: what the new French climate law would change

Séverine Amate, spokesperson for SeLoger, declared: “This influx of energy-intensive goods will therefore have an impact on prices by penalizing the lowest-rated homes.

New homes, which offer much better thermal insulation, are in great demand.

Loïc Madeline, Deputy Managing Director of Sogeprom Ile-de-France, said: “There are very few new developments in Paris, but you can expect to pay € 13,000 per square meter outside of major city centers, and, in many cases, they are marketed only by word of mouth.

Parisians are also increasingly leaving the capital, reducing overall demand, resulting in lower prices.

In a December 2020 report, the National Institute for Statistics and Economic Studies (Insee) notes that Paris has been losing inhabitants since 2012.

The capital today loses an average of 10,800 people per year, whereas it gained 14,000 per year between 2006 and 2011.

Prices are climbing elsewhere

The change in trend in Paris comes as property prices elsewhere are on the rise, particularly on the Atlantic coast.

A recent study by UK credit website found that France is now in the Top 10 for global house price increases among OECD countries, at € 8,311 per square meter in average in 2020.

Non-new homes outside of Paris are among the properties with the biggest price increases, largely due to the “longevity of teleworking” since the onset of the health crisis.

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