Make a Move to France…Do It Now

The events of the world, which seem to make big statements on a daily basis, whether they be political (the U.S. election and Britain leaving the E.U.), or terrorist activities (from the recent massacre in Nice to the murder of a Normandy priest), or the battle between the police and the African American community…are sure to affect the economy and the property market in France as it will everywhere. Your crystal ball is as clear or unclear as mine as to how the events will affect our future.

I am certain that if Donald Trump were to be elected, that many Americans will be seeking an alternative country and one of those will be France. Canada is already experiencing an increased number of applications for immigration and a number of celebrities have vowed to move to Canada or other spot on the globe, such as Rosie O’Donnell, Chelsea Handler (to her house in Spain), Lena Dunham, Jon Stewart and others. While this would be a big boost to our business here in France, and we’d certainly welcome all Americans with open arms, it’s not in our overall best interest to elect a man who is so clearly unfit for the job and could easily destroy international relationships, that took so long and hard to build, in a split second. The very thought of it makes my head spin. (Read the interview with him by Meet the Press on July 24th)

At the same time, the British who voted to exit the E.U. have done themselves a disservice similarly. The British who live and work in France are scrambling for answers as are the French and other Europeans who live in England. British homeowners are watching their French properties increase in value in sterling as it decreases in value against the euro, but there are those in England wishing to move to their French and E.U. homes for their own opposition to Brexit, much like Americans who oppose Donald Trump.

Meanwhile, everyone fears terrorism — the whole point for the terrorists — and nowhere seems safe any more. Terrorist activity is reaching every corner of the globe and our search for a safe haven is turning up very little. Questions about the value of property in Paris and other parts of France continue to plague us, but based on the statistics from May 2016 reported by the Chambre de Notaire, things are looking up for sales and prices in Paris and the Ile-de-France and that means buyers shouldn’t waste too much time making their purchase.

Thanks to an active spring in the Paris market, 36,290 existing homes were sold in Ile-de-France from March to May 2016. In line with previous months, the recovery in activity continued but the pace became slower. Sales increased by 13% compared to the same period in 2015. The increase is a bit higher for apartments (14%) than for houses (10%). The particular dynamism of the month of May 2016 could have been affected by the significantly higher number of working days than last year.

Total sales from March to May 2016 were 13% higher than the 32,100 sales recorded on average the last 10 years and they approach less (-3%) than the period of high activity (1999-2007). June 2016 is predicted to continue with dynamic activity still driven by exceptionally attractive interest rates, but with growth less sustainable than last year or early 2016. This good level of activity causes some pressure on prices of the most expensive properties. So far, the rise in sales volumes remained without impact on overall prices. Prices continue to stagnate in the Ile-de-France, but some departments, especially the more expensive and especially Paris, is now experiencing very slight increases. In one year, prices of resale dwellings have had a small increase of 0.9% in the Ile-de-France (+1.1% for apartments and 0.5% for houses). For apartments, Paris plays a key role in this movement with an annual 2.3% increase in May 2016, which is much more moderate in the Hauts-de-Seine (+0.8%) and in the Val-de-Marne (+0.5%). In the Grande Couronne, apartment prices are still on a downward trend (-0.7% in one year).

Leading indicators on preliminary contracts of the Paris notaries confirm a trend further upward in summer 2016, which is also quite usual for this time of year. However, the annual change in prices will still be rather limited in September 2016, with an annual expected rise of 1.4% for apartments in the Ile-de-France. This upward movement is driven by the capital (+2.8% over one year and 8,240€/m² expected in September 2016). Prices remain virtually unchanged, however (-0.5%) for homes.

According to the data of the Notaries of Paris-Ile-de-France, a third of those who sold an apartment in 2015 were executives and business leaders (up 8 points from 2005 to 2015). It was in Paris that the share of professionals as sellers is the highest — 44% in 2015. Their presence was strengthened at the expense of middle management (-6 points) and employees and workers (-4 points). The proportion of retirees increased and is now close to 30%.

To read the entire report (in French), download the PDF.

So, in spite of the November attacks in Paris, the property market hasn’t wavered…in fact, it’s stronger than ever. If you’re thinking of making a move to France, do it now.

A bientôt,

Adrian Leeds
The Adrian Leeds Group

 (Photographed photographing at Paris Plage)

Respond to Adrian: [email protected]

P.S. French Property Insider will not be published on August 4th while I am vacationing on the island of Mallorca — a new adventure for a European vacation. You will still get your promised 50 issues a year, however!