Real estate hunter in Paris: zoom on the real estate market

Published on 06/21/2020

Key figures of the real estate market in Paris

The French real estate market is experiencing real variations, especially in large cities like Paris. After a rather dynamic 2018 on the residential real estate front, there are more and more signs in favor of a trend reversal. Far from a collapse, a slowdown in transactions seems inevitable, according to specialists who practice as real estate hunters. Here are some key figures for the real estate market in Paris in recent months.

A sector in perfect health in 2018

The Paris real estate market saw an increase of around 17% in 2018, compared to 15% in 2017. This improvement can be explained, among other things, by historically low interest rates (around 1.50  % on average at a fixed rate over 20 years), which supported activity throughout 2018. Facilitated by the extension of the duration of the loans, the loan conditions played a major role in the fluidity of the transactions, which for the most part involve a real estate hunter (nearly 950,000 in the former after the record of  968.000 registered during the year 2017).

The volume of sales was 8750 housing units in Paris in the 1st quarter of 2018. During this same period, prices per m² reached peaks, varying between 6660 €/M2 in the 75018 in La Chapelle, and €14,880/m2 in the Saint-Thomas d'Aquin district in the 75007. the most expensive and cheapest borough.

As mentioned above, according to specialists who work as real estate hunters and many other experts, the real estate market has relied, among other things, on extremely low interest rates, given that we are talking in average of 1.5% over 20 years. But that's not all: we must also point out the impact of fundamental factors that fuel confidence in real estate. These include the desire to become a homeowner, the desire to build up secure capital for retirement, and the difficulty of finding housing on a daily basis, with a constantly accentuated imbalance between supply and demand.

Added to these factors is the much more dynamic economic situation and the now less tight labor market. Chasseur immobilier and other specialists in the field all the same agree in recognizing that this growth recorded in 2018 and at the beginning of 2019 may not last the whole year, for reasons as simple as they are relevant!

Real estate hunter: less solicitation in 2019

The less accommodating monetary policy of the ECB, the increase in government borrowing and the conditions for granting loans which have become more restrictive are the imminent signs of a slow and inevitable rise in rates in 2019. And all this , this is without mentioning the still high prices in the big cities and the decline in new home sales, which leads to less solicitation of real estate hunters!

Indeed, sales of new homes are down over one year by nearly 10% according to figures from the New Housing Observatory of the Federation of Real Estate Developers. The share of those who buy a new property to live there is down by - 2%, while that of investors who buy new housing to rent it out and reduce tax with this formula is down by 17 % . The rates should nevertheless remain attractive below the 2% mark on average over 20 years according to specialists who exercise the profession of property hunter.

Photo by Sebastien Gabriel/Unsplash

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Parisearch, a local agency expert of the Parisian market

Parisearch is a real estate agency in Paris.

Connected 24 hours a day to the market and its network, it responds to all requests for research or sales of real estate in Paris and the Ile-de-France.

Its objective is to accompany its customers in the realization of their project of life by securing their step and by allowing them to reach rare goods (off-market) which will make their happiness and will answer perfectly their criteria.

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