On the up

Living France - - Les Pratiques - no­taires.fr

The lat­est No­taires de France re­port shows that the French prop­erty mar­ket was ex­tremely dy­namic in 2016, with sale vol­umes up by 11% dur­ing the past year to reach the high­est level recorded in the last 10 years.

Two main rea­sons are thought to ac­count for this in­creased ac­tiv­ity, namely low in­ter­est rates and the fact that the mar­ket is catch­ing up af­ter ex­pe­ri­enc­ing three years of a ‘wait and see’ at­ti­tude.

The fact that sale vol­umes con­tinue to in­crease con­firms the re­cov­ery that started at the begin­ning of 2015. The num­ber of trans­ac­tions over the 12 months to the end of Septem­ber 2016 across the whole of France is es­ti­mated at 838,000, an in­crease of 11% com­pared to the fig­ure recorded the pre­vi­ous year (755,000). At the end of Septem­ber, the es­ti­mated num­ber of prop­erty sales was up by 15.1% year-onyear in Île-de-France (160,400 sales) and by 10.1% else­where (677,600 sales).

How­ever, while sale vol­umes have reached their high­est level in 10 years, prices have not re­turned to those of the mar­ket peak seen in 2011. Nev­er­the­less, house prices have risen by 2% from Q3 of 2015 to Q3 of 2016. Only St-Éti­enne and Le Havre have recorded a year-on-year de­crease (-1.9% and -1.2% re­spec­tively), fol­low­ing in­creases of 2.3% last year. Rel­a­tively sta­ble house prices were recorded in Toulon, Mont­pel­lier, Mar­seille, Aix-en-Provence and Reims (move­ment be­tween -1% and +1%), while the big­gest in­crease in house prices was in Rennes, ris­ing by 7% to reach €215,000.

Apart­ment prices have also in­creased by 1.4% year on year, fol­low­ing a pe­riod of grad­ual de­cline since mid-2012. This in­crease was mostly seen in Île-de-France, where prices have risen by 2.7% year on year. Else­where, prices have risen by 0.3% and re­main at their 2009 level. The big­gest in­crease in apart­ment prices was in Bordeaux (+4.1%) to reach €3,200/m2.

It is un­cer­tain what will hap­pen to the

mar­ket in 2017, the year of the French pres­i­den­tial elec­tion, but there are sev­eral pos­si­ble sce­nar­ios.

If the ex­emp­tion from pay­ing cap­i­tal gains tax on sec­ond homes was re­duced to 15 years from 22 years, ven­dors may be en­cour­aged to come back to the mar­ket, with prices set­tling as a re­sult. If there is a re­duc­tion in tax­a­tion on in­come earned from prop­erty, in­vestors may re­turn to the mar­ket which may cause prices to in­crease. Any changes to France’s wealth tax ( im­pôt de sol­i­dar­ité sur la for­tune) may af­fect the lux­ury prop­erty mar­ket.

The re­port also gives an in­di­ca­tion of what buy­ers can ex­pect to be able to pur­chase with their per­sonal bud­gets. You might ex­pect to pay €80,000 for a stu­dio apart­ment in Nice or Lyon, or €150,000 for a two-room apart­ment in Cannes, for ex­am­ple, while €500,000 could buy a six-room house in Nantes.

Newspapers in English

Newspapers from UK

© PressReader. All rights reserved.