Shades of optimism at the Paris real estate market

Shades of optimism at the Paris real estate market

The real estate market in Paris is finally on the mend. For the first time after decreasing by about 30% activity of real estate market in France following the election of Francois Hollande a half years ago, reports with reference to the French media.

Optimism returns to one of the major players in this market - Daniel Féau, the real estate agency in Paris. The atmosphere has changed completely - says Charles-Marie Jottras, president of the agency - Tangible resumption of sales seen in the second quarter of 2013. The total amount of sales is €275 million, and an average of two deals every day.

It seems that the ice was broken, and the situation on the French real estate market finally began to improve. When you consider that the second part of the year is traditionally better than the first (buyers and sellers want to complete the current transaction before the end of the summer holidays), prices should rise by about 8%.

Another important figure in the real estate market, the agency Barnes, confirmed that the case is really gone better. "In the first half of 2013, our business has grown by 30% year on year - said Richard Tzipine, CEO of the agency. - Years of euphoria when the first floor could be sold for the same price as the sixth completed. Now property of high quality in France is sold for several months with discounts from 5% to 8%, but those objects that have any flaws or performance work is required, are sold at a discount of up to 20%. "

The agency Emile Garcin, which is a competitor of Barnes, trying to be much more careful in such forecasts. Director Philippe Chevalier said "We see slight improvement, but not a global turn in the opposite direction." "A year ago, the market was at a dead end - he said. - Sales satrted again in 2013, because the sellers started to reduce prices."

Are the foreign buyers who have become very cautious about buying property in Paris after the election Francois Hollande gonna return to the French market? "Not yet, - says Chevalier. - Transactions with foreigners make up only 22% of our sales compared to 65% in 2010." U.S. and European buyers still make up a lonely minority. The agency Barnes reports, that only 15% of transactions fell to foreign clients on the Left Bank of Paris, popular among foreigners, compared with 40% in 2011. However, in the elite sector of the housing market (objects worth more than €5 million), the amount of which is very limited, 85% of buyers are the foreigners.

According to Francois Hollande and Bernard Cazeneuve, tax credits for sale of second homes and rental housing are considered as a factor that is likely to improve the situation on the luxury properties market. "At least one third of apartments in Paris that we sell are second homes," - says Chevalier.

Text: Marina Malova,