There have never been as many large apartments on the market in Paris. “In one year, the time it takes to sell a three bedroom apartments increased from 54 to 73 days in our network,” said Fabrice Abraham, president of Guy Hiccups.
According to the Parisian notaries, the price of Paris apartments over 100 square meters has dropped 3.9% in 2013 and 1.7% in the first 11 months of 2014. Many industry experts put this drop down to the sharp increase in stock, which came about as a result of Hollande’s wealth tax enforcement back in 2012. The effects of this move are still being felt today.
Yet whatever the reason for the price drop, the turnaround is perhaps not so surprising as this type of property had appreciated by almost 10% per year between 2000 and 2008, with the exception of 2001 (+ 1.9%).
Resistance in the East
A more detailed analysis shows that the decline is stronger in the central and western districts of Paris. Between 2011 and 2014 average prices decreased from 14,260 euros to 12,550 euros in the 7th (-12%) and 10,940 euros to 9,850 euros in the 1st (-10%).
However, they have hardly budged in the 10th, 11th and the districts of the east providing evidence of a ‘rebalancing’ of prices between the historically more expensive western areas and the generally more affordable east.
In the 16th the situation is mixed. In appearance, the prices seem to resist: between 2011 and 2014, the average price of apartments over 100 square meters decreased from 10,070 euros to 9,340 euros (-7.2%). But these figures mask very different realities depending on the type of property.
In this iconic district of the capital, the richest of Paris’ large residential areas and the only district to hug the Bois de Boulonge, the stock of haussmannian apartments for sale has considerably inflated to the point of unbalancing the market.
Many of the larger apartments also require lots of work to bring them up to a level consistent with modern day requirements and this is scaring off a large proportion of buyers. Does this mean that one hundred square meters in Paris is now too much?
The price of these apartments fell by 25% to 30% from the peak in 2011 and if they have defects, the price drop can exceed 30%. Despite their value, French families cannot afford them, meaning the only available market is that of international buyers.