2017 — Already a Record Year in Paris Property Sales!

According to the Notaries of Paris-Ile-de-France, the economic situation remains very buoyant for the sale of housing and the activity established shows high levels in the Ile-de-France region. 2017 will be an exceptional year. Housing sales volumes far exceed the levels of the “highest period” between 1999 and 2007.
 
In third quarter 2017, Ile-de-France prices posted new increases, but in the coming months, a break is to be expected in the Petite and especially in the Grande Couronne. Supply wanes while demand is high — sales volumes are struggling to increase, while prices could increase by nearly 10%, demonstrating the renewed interest of buyers for real estate.

Annual price increases are stronger in Paris than in the suburbs, but from the second to the third quarter of 2017, prices continued to rise in all the markets of the Paris region. The increases are stronger in the heart of the city than in the Grande Couronne, and for apartments (+5.8% for the whole region, at 5,740€/m²), more than for houses (+2.7%, to 307,400€).
 
In the Petite Couronne, the price of apartments has increased by 5.3% in one year, with little difference between departments. In the Grande Couronne, the annual increase was limited to 2%. The increase in house prices was less, both in the Petite Couronne (+3.5% in one year) and the Grande Couronne (+2.4%). In Paris, the acceleration of price increases is continuing. In one year, the price of apartments increased by 7.8% to 8,940€ per square meter at the end of September 2017. The price variations are between 1% and 15% depending on the boroughs, with prices per square meter ranging from 12,220€ in the 6th, to 7,090€ in the 19th.

 
The most expensive neighborhoods in Paris are: St. Thomas Aquinas (7th) at 14.650€/m2, Les Invalides (7th) at 14,360€/m2) and Odéon (6th) at 14,120€/m2. The least expensive neighborhoods are La Chapelle in the 18th (6,760€/m²), Pont-de-Flandre (6,810€/m²) and La Villette (6,970€/m²), both in the 19th. The price per square meter is expected to reach around 9,200€/m² in January 2018 (+10% in one year!). From May 2015 to January 2018, prices could increase by more than 1,300€/m² (+17%).

Leading indicators based on pre-sale contracts by notaries in the Paris region anticipate a softening on apartment prices by the end of 2017 and January 2018, with the exception of Paris. The selling prices could have a slight erosion during these few months, and in a rather generalized movement in Petite Couronne, more accentuated for apartments in Grande Couronne. In January 2018, the annual increase in the price of apartments could be reduced to 3.6% in the Petite Couronne and a small decline is even expected in the Grande Couronne (-1.2% in one year). For houses in the Ile-de-France, prices could increase by 5.6% in one year by January 2018.

For the first nine months of 2017, the Ile-de-France has had more housing sales than for the entire year of 2012, 2013 or 2014. Sales from January to September 2017 increased by 21% compared to the same period in 2016! In third quarter 2017, the number of resale home sales was 15% higher than the average for 1999-2007 and 30% above the average for the last 10 years. In the coming months, a very good performance of activity should be experienced.

The housing market is currently running at full speed in the Ile-de-France. 2017 should end on a new historical record of sales volume, but, the growth potential is projected to diminish. At the same time, in Paris and on certain tight sectors of the Petite Couronne, the Parisian notaries note that some of their customers are starting to wonder about the level reached by the prices.

Many elements favorable to the market subsist in the short term: attractive home loan rates, economic conditions and a gradually improving job market, plus a desire to become homeowners. The possible impact of the fiscal reforms of 2018 remains to be seen.

 
We can reasonably hope that in the Ile-de-France activity and sales will be maintained at an excellent level in the coming months. My advice to you: don’t hesitate to make your investment as soon as possible!
 
The Chambre de Notaires offers an interactive press kit,
or you can download the PDF version.

A bientôt,

Adrian Leeds
Adrian Leeds Group

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