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Real estate: prices are plummeting in Paris and its suburbs

Real estate: prices are plummeting in Paris and its suburbs

Posted February 24th. 2022 at 14:00

Breath of the real estate frenzy on the most age-old real estate market in France would it fall ? This is what the notaries of the Greater Paris Area confirm in their market update of February 24, 2022. Observable from the fourth quarter of last year, calm signs in Paris and its suburbs are confirmed at the beginning of the year.

In the capital , the fall in prices continues. Over one year, at the end of December 2021, prices fell by 1.6% to 10,600 euros per m² (-1.7% over three months, in the fourth quarter of 2021). However, according to key notary indicators on forward contracts, the price per square meter in Paris would stand at 10,550 euros in April 2022, ie an annual price fall of 0.8%. Finally, compared to the high point of November 2020, prices per month in the capital will lose 310 euros and 2.9% in a year and a half.

And yet, at the same time, activity is still at a high level. “The re – entry of files in the studies has been done properly since January,” says Thierry Delesalle, president of the Commission for real estate statistics and a notary in Paris. We should move towards the normalization of the property market unless the pandemic reappears regardless of the impact of the war in Ukraine, which we cannot measure at this point. »

additional gentrification

The high level of activity of Parisian transactions should logically lead to a rise in prices, the notaries believe. The situation is therefore unusual, even if the downturn is slowing in Paris, they point out, “the volume effect that creates price tensions. »

Thus, the loss of the attractiveness of Paris, a trend that has been exacerbated by almost two years of health crisis, must be qualified. “Even if many tenants leave the capital to buy in the suburbs, Thierry Delesalle notes, virtual price stability in the capital is once again attractive, especially if we compare to other foreign markets whose prices are burning. »

Once again, the five peripheral arrondissements in eastern Paris fell below € 10,000 per m² at the end of December 2021. While the price difference is between the most expensive arrondissement (6th) and the cheapest (19th), and the most expensive area (Invalides in. 7th) and the least expensive (America in the 19th) shrinking, indicating that Paris continues to nobility.

Among the record transactions the notaries cite 300 m² in Saint-Thomas-d’Aquin in the 7th district sold for 41,700 euros per m², or more than 12.5 million euros and, “not heard”, 18 m² studio at Porte Dauphine. sold for 38,300 euros per month!

The same phenomenon is found in terms of increasing the number of transactions as well as more prudent price developments in the suburbs of Paris . According to notaries’ preliminary contracts, in April, the annual price increase would be 1.7% for apartments in the inner suburbs but still 3.6% in the outer suburbs and would fall for homes to 5.1% in the inner suburbs. and 4.4% in the outer suburbs.

This slowdown in property prices could be the beginning of a gradual landing, in a context that remains buoyant but with increasing uncertainty.

An exceptional year 2021

Prices of former real estate rose by 7.1% in France in 2021, according to provisional data from the Notaires-Insee index published on February 24, 2022. Single-family homes are the most affected by price increases, with 9. % increase in 2021, confirming the French desire for greenery and space. Conversely, apartments are marking time with an increase of 4.6%. This slowdown is due to Île-de-France, with apartment prices struggling and even falling in Paris (- 1.6%). The more you get from the capital, the more apartment prices increase. The number of transactions stopped, reaching a record high in the third quarter, exceeding 1.2 million over one year, to 1,178,000.

The AFP

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