The French capital is once again on the radar of property buyers, both French and overseas, who have been holding out for the perfect buying conditions, according to the latest Paris Residential Property Market report by Athena Advisors.
Figures reveal a slight increase in prices in Paris of 0.8% over the three months to July 2015 and a year-on-year price recovery of 0.1% with the average price per square metre rising to €8,368. Transactions have also risen recently and summer viewings in Paris are up 42% compared to last year.
“Those buying in the last six months have timed their purchases almost to perfection,” says Nicholas Leach of Athena Advisors. This year has seen low interest rates, favourable exchange rates and softening property prices all of which have attracted foreign investors. Along with this there have been several political developments that have benefitted overseas buyers: in February capital gains tax for non-EU residents was reduced to 19% and in March social charges on rental income and property sales for non-residents were ruled illegal by the European Court of Justice.
As a result the proportion of foreign buyers of Parisian property has risen from 8.2% in 2014 to 9.2% in the first three months of 2015, although this is still considerably less than London where foreign buyers comprise 75% of the market. A study by the Notaires de Paris association has revealed that there has been a decline of international buyers buying a second home (only 3% of buyers in 2014 compared to 4% in previous years) with more opting to buy a primary residence in Paris.
The report reveals that foreign buyers tend to focus on the most central locations in Paris causing a spike in prices in certain arrondissements, including the 11th arrondissement, on the right bank of the Seine and home to the Place de la Bastille, which recorded an increase of 6.3% in the second quarter of 2015.
Unlike London, there is a marked difference between prices in central Paris and the area beyond the Périphérique (roughly equivalent to Greater London) with prices in Île-de-France rising 187% over the last 20 years compared to a massive increase of 365% in central Paris. www.athenaadvisors.co.uk www.paris.notaires.fr