The rising price of properties for sale in France – French property market
The price of properties for sale in France increased by 8.3% between March 2005 and March 2006, according to a report by French estate agents association, FNAIM. This was a significant slowdown on the previous year when an increase of 13.6% was seen on properties. France is forecast to experience further increases in the new-build sector whilst the rate of growth has been slower for apartments.
What does this mean for those selling properties? France’s changing market
The FNAIM declared itself happy with the report, mainly because there was a 4% increase in the number of properties being sold in France over the 12-month period. However, this hides the fact that the number of properties France saw being sold fell by 2% in the first quarter of 2006.
The asking price of properties for sale in France has skyrocketed in recent years and so this may be a sign of a market experiencing a soft landing. Prices are forecast to continue rising but not at the rates we have seen since 2000 when the market for properties in France has grown by over 70%.
Hotspots for properties for sale in France
Although Paris remains the most expensive area in which to buy properties, France’s capital city’s rate of price growth was lower than the rises seen in other major cities.
Apartment prices in and around Paris have started to decline in some areas. In contrast, Pau, in Aquitaine´s Pyrénées-Atlantiques department, saw apartment prices increase by 17.7%, to €1956 per square metre.
Normandy, Brittany, and Aquitaine were the top performing regions between March 2005 and March 2006. At €234,962, Aquitaine has the most expensive average property prices of the three. Normandy was the least expensive with average properties for sale going for €168,056.
Go for a new-build? France’s property prices depend upon the type
The largest growth sector amongst UK buyers was in new-builds. France’s leaseback scheme offers fantastic buy to let opportunities and this accounts for the popularity of new-builds in France amongst foreign buyers. The market for new-build properties in France is now even more attractive to UK buyers because of changing pension and investment legislation.
Aside from new-builds, France saw the average price of a villa rise by 9.9% and in general houses outperformed apartments between March 2005 and March 2006. The biggest slowdown in properties for sale in France was apartment sales in the Paris area.
The FNAIM believes the market for properties in France continues to thrive and there is no reason to think prices are set to fall anytime soon. The Parisian sector could be taken to be an exception to this and a slowdown might be seen there before other areas. New-build properties continue to attract investors and the relatively low number of properties for sale in France might keep prices rising, albeit at a slower rate.
