We have prepared for you a special report on the evolution of prices on the Parisian real estate market and in the Paris region in order to try to better understand the impacts of containment as well as to know what the prospects are for 2021, arrondissement by arrondissement.

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SPECIAL REPORT - December 2020 & OUTLOOK FOR 2021

Post-containment real estate market analysis : Paris & Suburbs  

SOURCE S : - Capital Magazine NOV 2020 - Special Real Estate Report Paris and its suburbs. - Swiss investment bank UBS - American investment bank Goldman Sachs 

Some important elements : Now houses are very popular, properties with an exterior too. More and more buyers have been squeezed out of the market since the start of 2020, banks have difficulty lending. The recovery plan 2 billion to help to finance the energy renovation of private homes, this stimulates interest in the property to renovate ( " tips " for prices more marketable and financeable renovation now).   

The market does not appear to be returning to normal. The rate of loans refused is 10% of those requested, the double of 12 months previously. For the most fragile files, the refusal rate has climbed from 20 to 30% in 1 year. Banks encourage borrowers to increase their personal contribution, now they require that the contribution is at least equivalent to the notary fees, and sometimes also 10% of the price of the property in addition. Still understanding banks such as Société Générale and La Banque Postale still accept borrowers from € 1,800 / month, but they only negotiate rates with higher incomes. 

Co-ownership : Simplified procedures aimed at restoring power to residents and the union council to the detriment of the trustees ( end-2019 ordinance). Maintenance work is facilitated, the control of the property manager is reinforced. Remote voting is now allowed. The trustee contract will have to be put into play every year instead of every 3 years. Individual requests will be better handled. 

Rental searches in Paris : Have fallen 23% in 1 year. In some cities the supply of furnished properties for rent has increased by 50% in 1 year. 

Market tension (demand / supply ratio) : Increase in tension from 4% to 26% on apartments . 42% to 60% voltage increase on the houses. Larger areas and properties with an exterior are the most in demand. 

Purchasing power : In Bern… Decreasing in 46% of large cities, and increasing in 27% of large cities. The buyers' envelope remains stable. Realistically priced apartments sell in two months on average 

REAL ESTATE PRICES in PARIS

Prices are starting to fall in certain areas of Paris, however they have increased in the inner suburbs, especially for houses and apartments with an exterior. Possible price evolution : A) Optimistic scenario : from 0% to + 3% B) Pessimistic scenario : -3% to -5% .   

Paris 1 st and 2 nd arrondissements : Foreign buyers are little or not present, including at beautiful addresses . A property in the royal palace with a view of the gardens is worth, for example, 20 to 30,000 € per m². Prices range from 8,500 to 30,000 € per square meter.   

Paris 3 rd and 4 th arrondissements : Small stores are entering the market. Towards Saint-Paul we are in the 14,000 € per m² rue Vieille du Temple we go up to 25,000 e per m², prices may vary from one building to another. The owners of small surface areas rented with Airbnb are now ready to sell, but not to negotiate for the moment. For the islands the entrance ticket is 15,000 € per m² for the docks, the prices increase if the good has a terrace or an elevator. Prices range from € 8,500 to € 30,000 per m².     

Paris 5 th and 6 th districts : Lower prices could succeed in the surge. Buyers are now able to negotiate on goods with defects. Near the Luxembourg Gardens the prices are around € 14,000 per m², Rue des saints pères is around € 18,900 per m². Prices range from € 8,500 to € 25,000 per m².     

Paris 7 th and 8 th arrondissements : The volume of transactions is decreasing. For goods with an exterior the price has increased by 20% and they are very popular. Prices range from € 8,500 to € 38,000 per m².   

Paris 9 th district: Wide selection of apartments from 100 to 150m² in this market. Prices range from € 7,000 to € 19,000 per m².   

Paris 10 th district : Prices are on the downside, except in certain neighborhoods. Depending on the sector, prices in this arrondissement could evolve in different ways . Prices range from € 7,000 to € 19,000 per m².    

Paris 11 th and 12 th districts : Workshops r énover, small surfaces placed on the market ince the rental crisis Ai rbnb .. Prices range from 7 000 € to 20 000 email m².   

Paris 13 th and 14 th arrondissements : Investors remain active despite the rent controls. For the moment the sellers remain firm on the prices. Nearly 5 th, prices reach 13 or even 15,000 € per m². In particular on the Avenue des Gobelins. The many buildings from the 1970s now appeal to retirees and families looking for an exterior. The market is less dynamic in the 14 th , the stock of goods on the market has increased and buyers are more demanding. Prices range from 9,000 to 20,000 € per m².    

Paris 15 th arrondissement : The goods with necessary works are again negotiated. Prices in the south of the arrondissement continue to rise, at least for goods with parking and outdoor space, however small. The other goods remain under 10,000 € per m². The most bourgeois addresses to military school or Champs de Mars are similar to pr ix 7 th arrondissement. These sectors have seen their prices rise by 35% in just 4 years . For example Avenue De Suffren the prices are around 15,700 € per m².  Prices range from € 7,000 to € 19,000 per m².       

Paris 16 th arrondissement: In the absence of foreign clients, national clients quickly make up their minds , even for exceptional properties, which surprises some. However, the number of goods on the market continues to increase, especially since the end of containment. The end of the cycle of price increases is near. The Auteuil and La Muette sectors continued to improve, as did Jasmin. The most sought after properties are the 3 and 4 bright rooms. At the edge of the Bois d e Boulogne , prices have seen an increase and are generally at € 15,000 per m. Of course , goods with an exterior have seen their prices increase by 10% to 20%. For example a 62m² with a 170m² terrace with views of the Tower Eiffel has been sold to 29 840 € per m². Properties with an exterior are sold for around € 17,000 per m² at the right addresses. Prices range from € 8,000 to € 30,000 per m².        

Paris 17 th arrondissement : Some sectors are more dynamic than others. The north of the borough is generally cheaper. Towards Wagram, Malesherbes or Monceau the slightest defect now generates a lower price. Sales times are generally longer since the end of containment. Prices should stabilize, but lower quality homes should see their prices fall. Prices range from 7,500 to 30,000 € per m².   

Paris 18 th arrondissement: Montmartre remains active. Towards the chapel door the prices range from 6,000 to 9,000 e per m². In Montmartre the prices per m² can reach three times for a house with a garden. Prices are expected to fall for goods with defects or for buildings of below average quality. Areas close to the ring road should see their prices increase with the 2024 Olympic Games. In most areas, prices range from 10 to 15,000 € per m². In the arrondissement, prices vary from € 6,000 to € 26,000 per m².      

Paris 19 th arrondissement : Strong growth in demand for properties with balconies in the 1970s. It is common to find family apartments for less than € 8,000 per m² (Stalingrad and Porte de Pantin ) In the most popular areas, prices are higher as around the Buttes Chaumont or the Ourcq canal. Prices range from € 6,500 to € 13,500 per m².     

Paris 20 th arrondissement : Strong demand for the many 2-room apartments. Prices have increased 8% over the past 12 months. Prices range from € 6,500 to € 13,500 per m².   

 

REAL ESTATE PRICES AROUND PARIS

Antony, Bourg La Reine, Sceaux : The studios are expensive. The prices are stable auf for the most recent goods. Prices range from 2 700 € to 8 100 th m².   

Charenton, Maisons Alfort, Saint-Maurice : After deconfinement, goods with an exterior have experienced a sharp increase in demand as well as in their prices. Prices range from € 3,000 to € 8,700 per m².   

Boulogne Billancourt : The prices seem to have gone up too high. The housing shortage worsened after the lockdown. Buyers rushed in and signed at record prices (+8 to + 15% over 1 year). Since September the activity has slowed down. There are fewer buyers and now they are taking their time and are much more selective. Prices could drop in early 2021 from -2% to -5%. Prices range from € 5,800 to € 15,000 per m².    

Clamart, Meudon : Sellers more and more in a hurry to sell. The stock of goods available on the market has increased by 30% at Clamart, buyers have a wide choice. The sellers have accelerated the marketing of their property, creating a market reversal, making them more willing to negotiate the sale price. There are not enough buyers to support the prices. In Meudon, prices have risen by 1% over one year, supply remains lower than demand. Prices range from € 2,500 to € 8,300 per m².   

Clichy, Asnières, Courbevoie : The feared shortage before confinement seems unlikely now. Buyers have become more scarce, especially because of the growing reluctance of banks to grant loans. The volume of transactions has seriously decreased. Over-valued goods no longer arouse interest. The price of fine goods should stabilize or decline slightly, that of unattractive and off-center goods should fall sharply. Prices range from € 4,200 to € 9,100 per m².    

Issy les Moulineaux, Vanves : Prices 10% to 20% higher at the foot of the metro. Between May and July a buying frenzy was noticeable, it has since calmed down. Prices have stagnated since September and could decline in less desirable areas. Prices range from 5,000 to 12,000 € per m².   

Malakoff, Chatillon, Montrouge : Buyers are now demanding. Demand tends to decrease, sellers are forced to negotiate in order to sell successfully. Prices could be reduced by spring 2021. Prices range from € 4,300 to € 9,200 per m².   

Massy Palaiseau : Prices near the RER have increased by 1% to 3% in 1 year. The most popular properties are houses with gardens and apartments close to transport. Prices range from € 2,000 to € 4,800 per m².   

The Pré Saint-Gervais, Les Lilas, Pantin : Since August, the beginning of a calm has been felt. The supply is lower than the demand, in particular because of the Parisians coming to seek an additional room or an exterior, consequently the prices of the most requested goods increased by 5% to 15%. Prices vary from € 4,000 to € 8,300 per m².   

Saint-Germain-en-Laye, Marly-Le-Roi, Le Pecq : Transactions over a million euros are numerous. Prices have climbed 3% to 5% year over year. Buyers from Paris are mainly looking for houses. Sales have doubled, goods for sale are increasingly scarce. In Saint-Germain-en-Laye the price sometimes exceeds 10,000 € per m² as in Paris. In Pecq you can reach € 7,000 per m². Prices in these cities range from € 2,500 to € 11,000 per m².      

Montreuil, Bagnolet, Romainville : Buyers, now especially Parisians, do not negotiate prices which have increased by 2% over one year. Prices range from € 2,400 to € 8,300 per m².   

Neuilly-sur-Seine, Levallois-Perret : In Neuilly the volume of transactions is high, but there is a two-speed market, on the one hand central goods close to transport and shops, on the other those which are more eccentric and / or without exterior. Now buyers no longer hesitate to negotiate goods with defects. Goods not sold after containment often see their prices drop. In Levallois, demand remains stronger than supply, prices are stable and should rise a little. Prices in these cities range from € 5,500 to € 13,000 per m².    

No gent, Joinville le Pont, Saint-Maur : Sales times have shortened and prices have climbed from 1% to 2% over 1 year in Nogent. In Saint-Maur the market is also dynamic, especially near the RER and in the center. Prices range from 3 000 to 8 000 € per m² in these cities.   

St. Cloud SEVR es, Ville d'Avray : Teleworkers emblent ready to move away from the stations. In Saint-Cloud, it was only at the end of summer that buyers returned, mostly first-time buyers or investors, looking for 2 to 3 rooms and knowing how to make up their minds quickly. Prices climbed around 2% year over year in the most desirable areas. In the city center : from € 4,600 to € 7,800 per m². For a house with a garden and a garage, it takes at least 700,000 €. In Sèvres, demand remains higher than supply, prices have risen by 3% in 1 year, as in the previous year, ie 6% over 2 years. In Ville-d'Avray, the consequences of teleworking are felt by the fact that buyers are now more present in areas far from transport. Prices in these municipalities range from € 3,400 to € 8,900 per m².       

Rueil Malmaison, Suresnes, Puteaux : Desires for the outdoors have driven up the prices of properties that have one. In Suresnes, small stores have seen their prices rise by 10% over one year. In Puteaux, buyers are waiting. Prices are stable and yields of around 5% are rather high. Prices in these municipalities range from € 4,000 to € 9,400 per m².   

Saint-Mandé, Fontenay-sous-Bois, Vincennes : Investors are less and less present. Goods close to transport are the most expensive. Prices range from € 2,500 to € 9,700 per m².    

Le Vésinet, Chatou : Near the RER, sales can be signed during the day, the market has been very dynamic since the end of confinement, it seems to be starting to calm down. The goods leave at the displayed prices, without negotiation. The shortage of goods has driven up prices by up to 8% per year for the beautiful homes of Vésinet, which sell for from 1 million euros. Prices range from € 2,800 to € 8,600 per m².   

Saint-Ouen, Aubervilliers, Saint-Denis : A drop in prices is to be expected in certain areas. After confinement, the market was very dynamic, prices rose from 2% to 4% over 1 year. Buyers are becoming cautious and negotiating prices much more since September. Price reductions are to be expected by summer 2021. Prices range from € 2,800 to € 7,500 per m².    

Versailles, Le Chesnay, La Celle-Saint-Cloud : Prices are increasing slowly but surely. After the confinement, the goods for sale became rarer and sellers put their goods for sale at prices 2% to 3% higher than the previous year. In Versailles, the greatest demand is around the Château, even if prices have not increased more than elsewhere. The Versailles Chantiers RER sector is also in great demand, the sector is changing with the construction of new housing. Prices range from € 2,900 to € 9,300 per m².   

Villejuif, Alfortville, Vitry : Strong demand around current and future stations. Over the past 12 months, prices have climbed 10% against 2% the previous year, even 20% around stations. Prices range from € 2,400 to € 6,800 per m².    

SOURCE & DATA : CAPITAL (MAGAZINE) - NOV 2020 - SPECIAL REAL ESTATE PARIS & SUBURBAN FILE 

OUTLOOK FOR 2021 : 

According to Swiss bank UBS : The deployment of a vaccine in early 2021 should allow the economy to return to its pre-pandemic levels by the end of 2021. Inflationary threats should remain rare, interest rates are expected to remain low for the foreseeable future. The change of administration in the US should translate into bigger fiscal stimulus packages as well as more predictable politics thus changing the losers and the winners in the market. A decline in the US dollar is not ruled out for 2021. In the long term, future returns are likely to remain lower than in recent years in all asset classes. The outlook for tangible assets (real estate) is better than for government bonds or cash for example. 

According to Goldman Sachs : Optimistic for 2021, the pandemic remains the number one problem, a mass vaccination by mid-2021 should see a return of economic growth by the end of 2021. 

Written by Mr Sylvain Serge Talvan - Founder & Leader - Talvan's International Real Estate Agency Paris the 12 DEC 2020 in Paris 16 th .