Through the Roof: Paris Prices

I couldn’t have said it better myself and have been saying it all along and for a while now. “Prices of property in Paris go through the roof (unlike the rest of France)” according to “The Local” in their June 27th issue.

As much as the socialist-thinking authorities have made an effort to make Paris more affordable by trying to discourage real estate prices from increasing, property gets more and more out of reach and those who purchased earlier will be laughing all the way to the proverbial bank.

The reasons? Those that Le Point cite are exactly what we know on a first hand basis, working with North American clients who say so: “The election of Donald Trump, Britain’s decision to leave the EU and Emmanuel Macron’s election in France have apparently all played a role in boosting property prices in the French capital,” according to Le Point.

While Americans are not the biggest group of foreign buyers (Italians outperform everyone, then the Brits…), they have more good reason to be making a purchase in the French capital.

First of all, those who oppose Donald Trump also fear what harm he can do. They want an “out” and a “back-up” “just in case.” The immigration offices are flooded with Americans seeking visas. I myself, and many of my friends living in France, have started the process for naturalization for the same reason. Before he came into office, we never even thought about citizenship in France, but now it’s our safety net.

The British are having the same reaction to Brexit. If Brexit actually goes through, the exodus will escalate and my prediction is that property prices in the U.K. will plummet — a good time to make an investment there while prices are low! Buy it with the euro or dollar, since the pound will weaken even further and your money will buy you even more. (Haven’t you been reading the news on how “The UK is now the worst-performing advanced economy in the world, with growth slumping to just 0.2 per cent in the first three months of the year?” [independent.co.uk/])

Yes, Macron is France’s savior, too. If Marine Le Pen had been elected, the interest in France by those seeking a refuge from the likes of Donald Trump and Brexit would be looking elsewhere. Macron is manna from heaven for those who believe he will be good for the French economy. I think his reach could be even beyond what you read in the media. All the French who left France for economic greener pastures may have the bright idea to return to their homeland now that there is hope. If they do, they will bring with them a whole lot of new ideas, advanced skills, a different outlook, and a lot more knowledge — all of which will be a shot in the arm to France. The influx of all this new talent is going to increase demand even more and drive prices up even further.

There are even more reasons for the surge in foreign buyers in Paris, not addressed in the article — such as 1) low interest rates, 2) favorable rate of exchange and 3) most importantly, a strong market that is earning investors beaucoup bucks in stocks, bonds and other financial products. Americans have regained the healthy portfolios they lost in the crash of 2008…and then some. They are looking for a place to put all that cash, with the idea that the market won’t continue like this for too long, especially if Mr. Trump deregulates and all hell breaks loose again with the stock market. Real assets offer protection against inflation, market stability, diversification and can generate an income, all while appreciating. A balanced portfolio is a smart portfolio.

As a side note, we got word yesterday that French President Emmanuel Macron invited U.S. President Donald Trump to attend the annual Bastille Day military parade in Paris on July 14th…and he accepted. This happens to be the 100th anniversary of the entry of the United States into World War I. Not everyone is thrilled. One former French presidential candidate said “Donald Trump is violent and there’s no reason for him being here,” and Jean-Luc Melenchon, leader of the France Unbowed movement, said “He is not welcome. That’s clear.”

My only hope is that M. Macron has an opportunity to thank Mr. Trump for sending so many Americans his way!

A bientôt,

Adrian Leeds
The Adrian Leeds Group

(by Erica Simone)

Respond to Adrian:

[email protected]

P.S. We have a new apartment for rent! Introducing Le Diamant Bleu. Located in the beautiful neighborhood of La Butte-aux-Cailles, you’ll enjoy totally relaxing in this off the tourist path area of Paris. Details are availalbe at Le Diamant Bleu. Book your stay today by emailing [email protected]!