As interest rates continue their slow recovery, prices for resale homes are expected to break all records in the capital next summer, with a price of €8,800 per sqm, with an annual increase of 7%, according to estimates by notaries. It’s enough to crush the hopes of potential buyers, whose purchasing power has already begun to decline, as well as slow the growth of the real estate market.
In the first quarter of 2017, prices for resale apartments in Paris were €8,450 per sqm after rising 5.5% year-on-year (compared with 3% for France), in large transactions – over 10,000, a new record for a first quarter. Thus a new historic record of the price of apartments would be reached next summer, the previous summit dating back to summer 2012, with €8,460 per sqm.
After experiencing “slow erosion for three to four years” and going down to €7,880 per sqm, the prices of apartments in the capital have been rising since the summer of 2015 and have thus recovered in the first quarter of 2017, the highest in less than two years.
Prices already fell in the most affluent neighborhoods: they exceed €10,000 per sqm in seven districts, of which four (1st, 4th, 6th and 7th arrondissements) are more than €11,000 per sqm. In the last quarter of 2016, the capital had only two districts at more than this amount: the 6th and 7th arrondissements. Conversely, only 4 districts remain below €8,000 per sqm: the 13th (€7,740), 18th (€7,580), 19th (€6,910, the cheapest in the capital) and 20th (€7,380).