The latest figures released by the French Notaires of Paris-Ile-de-France indicate that whilst the Paris property market is still sluggish the price drops are continuing to slow.
“The weakness in the real estate market is a reflection of social and economic stagnation experienced by our country,” comments Catherine Carely, president of the Chamber of Notaries of Paris.
15 districts down, five up
On the whole, Paris is the exception to countrywide price falls. Prices of existing homes will “…show surprising resilience in a general context of concern,” says Frédéric Dumont, notary in Montreuil.
Second quarter 2014 figures show that the average price in the capital now stands at €8.120 per square meters, down 0.2% from first quarter figures resulting in a – 1.1% decline year on year (T2 2014 compared to Q2 2013) and 3.7% if we refer to the peak of the third quarter of 2012.
This brings property in Paris down to around the levels seen in the second quarter of 2011.
The slow price erosion of Paris prices is expected to continue for the coming months. The contracts signed since March show a decrease of about 0.8% in the 3th quarter 2014 compared to the previous quarter. “It is likely that in the present context this downward trend will continue until the end of the year,” added Frederic Dumont. “We are moving towards the threshold of 8,000 euros per square meter but this hasn’t been reached yet.”
MeilleursAgents.com, the French property network, network has indicated in its latest monthly barometer that prices were going to go below the psychological barrier of €8,000 per square metre in the capital after an accelerated decline during the summer.
“We will see lower prices in Paris”, said Frédéric Dumont, “The sellers, rather than preserve their asking prices, are accepting price negotiations proposed by the buyers. “For buyers to be in control of decision process means it is slower, [they] are always motivated but more hesitant.
Key figures of Parisian real estate
- An area of about 100 square
- A housing stock of about 1.3 million
- 62% of the buildings were built before 1949, 20% between 1949 and 1974 and 18%
- 33% of residents own their primary residence ( 58% for
- In 2013, 28,000 older apartments have been sold.
According to the Notaires in the capital, prices were down in five arrondissements (one year, comparing Q2 2014 to Q2 2013), including among them the fourth (- 6.4%), the third (- 4 8%) and 8th (- 4.2%). Against the trend, five boroughs are up in the same period: 9th (+ 2.6%), 2 (1.8%), 17th (+ 0.9%) and 11th (+ 0.4%).
As for activities, sales recovered slightly over one year: 7,420 transactions in Q2 2014, up more than 12% from the second quarter of 2013 and 10% compared to Q1 2014.
The number of sales is still 26% lower than it was on average in the period 1999-2007, before the financial crisis. Note however that in that market, foreign buyers (both residents and non-residents) have never been present. Their share changed from 7.8% to 8.3% between the 1st half of 2013 and the 1st half of 2014, a record for 15 years. The Italians are still the most numerous accounting for 17% of these foreigners, followed by Chinese (6.5%).