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An End of the Year Lull…

Volume XX, Issue 5

People sitting in the chaises bleu along the beach in Nice, France

WHY ARE PARIS LANDLORDS SO DIFFICULT?

We work regularly with The Local, an English language online news source for the expatriate community in France. One of the journalists, Sam Bradpiece, contacted me yesterday with a few questions about the ins and outs of renting a property in France. Within two hours, the article was out!: Why are Paris landlords so difficult and what can you do about it?

In essence, securing a rental apartment in France is difficult, particularly for foreigners. The top of Sam’s list of advice is to work with an agency, such as ours: “This process will undoubtedly end up costing you extra money – but it is also the easiest way to find yourself somewhere to rent without banging your head against the brick wall of French administration. A number of agencies have been set up specifically to help English-speakers move to France, and have bilingual staff who can negotiate with landlords and help you get your dossier together.”

Cover photo for The Local artical on landlords in France

And he took my advice: “Finding an owner of your own nationality can be an effective way of getting around the tough conditions imposed by French landlords. ‘A North American owner is more likely to rent to someone of their own ilk. It’s cultural,’ said Adrian Leeds of the Adrian Leeds Group. The best way to find an English-speaking landlord is simply by asking around. Some lettings and relocation agencies may be able to help you with this too.”

Looking out over the rooftops of Paris toward the Eiffell Tower

To read the article in its entirety, one must be a member or subscriber of The Local…but it’s well worth it!

END OF THE YEAR REAL ESTATE “LULL”

The Chambre de Notaires de Paris claims there was a lull in activity at the end of 2021 in the Ile-de-France after a period of strong acceleration. Recorded were 43,230 sales of existing homes from September to November 2021. Compared to the same period in 2020, which benefited from a strong catch-up in activity after the first confinement, sales fell by 14 percent (-11 percent for apartments and -19 percent for houses). For houses, the comparison with the exceptional end of the year 2020, which had benefited from an influx of demand, accentuates the phenomenon of decline.

Graphic showing the drop in sales volume of real estate in France

Although activity is marking time, it is still 9 percent above the average sales figures calculated over the last 10 years from September to November. In detail, and compared to the same period last year, sales volumes were still historically high in September 2021, but down in October and November. They were barely above the averages of the last 10 years for these two months. According to their initial indicators, this less dynamic trend could have continued into December 2021.

This should not prevent a very good level of activity for the whole of 2021 in the Paris Region, up over that of 2020. It could even approach or even exceed the historic record set in 2019. Sales volume trends by geographic sector and by housing type are mixed, but are generally down for the period. From September to November 2021, the Paris market remained on track with sales volumes close to those observed a year ago for the same period. Apartment sales fell more in the Petite Couronne (-17 percent) than in the Grande Couronne (-10 percent). As for the house market, the decline in activity is greater in the Grande Couronne area (-21 percent) than in the Petite Couronne area (-11 percent).

Garphic showing appartment prices for November 2021

In Ile-de-France, from November 2020 to November 2021, the annual increase in prices of older homes was reduced to 3 percent, after having reached 6.6 percent in November 2020. The contrast between the surge in Ile-de-France house prices, which rose by 6.6 percent one year, and the moderation in price changes for apartments (+1.4 percent) continues. From September to November 2021 in Ile-de-France, prices were globally stable for apartments and up by 1.5 percent for houses.

Graphic showing the sale prices of older home in the Ile de France region

In Paris, a phase of slight erosion in values is likely to continue, according to their leading indicators on pre-contracts. The price per square meter would fall from €10,670 in November 2021 to €10,560 in March 2022, a slight annual decline of 0.9 percent. Again according to the leading indicators on preliminary contracts, price changes should also be more moderate in all other markets in the Paris region, with apartment prices rising by 2.3 percent in the Petite Couronne and 4.3 percent in the Grande Couronne between March 2021 and March 2022. For houses, the annual increase in prices will also slow down with +3.2 percent in the Petite Couronne and +4.3 percent in the Grande Couronne.

Read the entire report (in French) by downloading the PDF.

ADVICE FROM THE CHAMBRE DE NOTAIRES DE PARIS

Here’s what the Chambre de Notaires de Paris has to say about buying a home in France (with some comments from me):

Buying a house is always an important moment where doubts, euphoria and sometimes stress are mixed. That’s why it’s important to ask yourself the right questions beforehand and to check several points.

     In France, between private individuals, you buy the property as is, i.e. as you have seen it and visited it, with no possible recourse against the seller, unless you prove that he has knowingly hidden things from you.

COMMENT: Hidden defects are called “vices cachés.” Legally, a buyer has recourse against a seller for such hidden defects.

Looking out over the coast of the French Riviera

Before visiting the house, do not hesitate to consult your Notaire to check with him the questions to ask and the points to verify.

COMMENT: You don’t need to consult a Notaire if you have advisors such as us!

Visit the property at least twice at different times of the day. Visit all the rooms included in the sale, such as the garage, the attic, the cellar. Take a close look at the walls and floors to find any cracks, moisture or water leaks. Find out about the insulation of the property: are the windows and roof in good condition? Also study the ventilation of the dwelling, the state of the plumbing and the electrical panel. Find out about the condition of the boiler, the number and type of radiators and their location.

     For this technical audit, do not hesitate to be accompanied by a trusted expert: for example a contractor or an architect.

COMMENT: An expert can be brought in, but certainly not before the seriousness of the potential purchase is certain. While this is regularly done in the U.S., in France much less often, as the seller is required to provide a long list of documents and diagnostics that are designed to provide the necessary proof.

All these points must absolutely be indicated to your Notaire. He will be able to ask the seller for any additional documents and refine his legal analysis.

COMMENT: The buyer’s Notaire works with the seller’s Notaire, not the seller, unless the seller has agreed to allow one Notaire to manage the entire transaction. If you are working with our Property Consultants, then it is more likely that our agent will work with the seller’s agent to provide the necessary documentation.

The charming village of Ansouis in France

The role of your Notaire is very important. He/she ensures the legal security of the transaction and accompanies you throughout the sale process. He ensures that the seller is the owner of the house and puts an end to any mortgage.

     Your Notaire also looks at whether the house is located in a subdivision or a condominium. Indeed, in the case of the sale of a condominium, certain documents must be submitted to you.

     If the house has undergone work, such as the construction of an attic or a veranda, your Notaire checks that it has been carried out in accordance with the town’s urban planning regulations. He asks the owner (or the owner’s Notaire) for the administrative authorizations, the invoices for the work and the contractors’ insurance certificates.

     Your Notaire also analyses the town planning documents. He looks at whether there are any easements that could depreciate the value of the property. An easement is a constraint imposed on the owner of a property, such as a right of way on his land or a site reserved by the municipality.

     If the house is connected to the collective sewerage system, your Notaire will make sure that the installation is in conformity. If it is not, you will have to carry out work at your expense. Be aware that many communes in the Greater Paris area require this.

Their latest advice :

1. During the visits, make sure you have a checklist so that you don’t forget anything,
     2. And don’t hesitate to ask your Notaire before signing your offer. If you have any legal or technical questions, he or she will be able to advise you and accompany you in your real estates project.

COMMENT: If you’re working with us, then we provide a lot more than the Notaire! We are your “insurance” that you will be buying the best property you can based on your needs and goals. The Notaires are not really programmed to provide advice, in the same way as a lawyer advises and advocates for you, but will point out the facts to assist you in making the best decisions.

A bientôt,

A smiling Adrian Leeds in Ojai, CaliforniaAdrian Leeds
The Adrian Leeds Group®

P.S. Tune in to Paris Underground Radio Monday, February 28th and the following Monday, March 7th, for an interview with Adrian Leeds by Gail Bosclair and Marie Pistinier about Fractional Ownership in France!

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1 Comment

  1. Donald Novak on February 3, 2022 at 3:36 pm

    Kindelberger in his classic book, Manias, Panics and Crashes, noted that in all past global banking crises, increased liquidity preceded a boom in asset prices and in real estate prices. Since 2008-09, the world has been awash in liquidity and easy credit causing a euphoric boom in asset and R/E prices. I would love a Paris apt., but am currently unwilling to indulge the mania; however I enjoy reading your posts. BTW my sister in law is an Adrienne and I have to look to make sure I’ve spelt your name correctly. Thx Adrian

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