Urbanity Loses Ground Over Rurality: Pandemic is the Driving Force
Volume XIX, Issue 43
According to Meilleurs Agents the driver of the real estate market in France has been the pandemic, because the rural communities are still scoring points this month with prices up 0.8 percent on average. The only metropolis to do well is Marseille, which is now attracting a new population of working people.
Since the beginning of the year, prices of properties located in rural communities have increased by an average of 7.4 percent throughout France, catching up with their 2008 level. This is nearly 2.5 times more than in the main metropolitan areas. The attractiveness of peri-urban* areas is confirmed again this month with an average price increase of around 0.8 percent. At the same time, the ten largest French cities (excluding Paris) only saw their prices increase by 0.1 percent.
*Peri-urban areas are zones of transition from rural to urban land uses located between the outer limits of urban and regional centers and the rural environment. The boundaries of peri-urban areas are porous and transitory as urban development extends into rural and industrial land.
The phenomenon is even more pronounced since the few large cities that were still resisting are collapsing. This is the case of Strasbourg and Nantes, which have seen their prices fall by 0.8 percent and 0.5 percent respectively this month. However, they had previously been riding a wave of growth: +7.8 percent for Strasbourg and +6.8 percent for Nantes between October 2020 and October 2021. In comparison, cities such as Lyon (+1.7 percent), Lille (+2.3 percent) and Nice (+2.6 percent) have, over the same year, grown more slowly.
Other signals that should alert us to the state of the market in Strasbourg and Nantes: real estate stress indicators (“indicateurs de tension immobilière” or ITI) at half-mast and median sale times (“délais de vente médian” or DVM) on the rise. Strasbourg has an ITI of 8 percent this month, whereas it still peaked at 22 percent in June. The same is true of Nantes, with an ITI of 6 percent this month, compared to 12 percent at the beginning of the summer. As for sales times, they are now around 55 days compared to 40 in June. The balance of power between sellers and buyers is thus tending to balance out.
Marseille has won out over Paris. Parisian real estate prices continue to plummet. The average square meter is now trading at 10,377 euros, a drop of 1.3 percent in one year and 0.4 percent in the last 30 days. And the real estate pressure is easing with a weak ITI (8 percent this month) and median sale times that have passed the two-month mark for the first time (64 days). Small surfaced properties are shunned and this has a direct impact on prices: -1.9 percent in one year (and -0.6 percent in one month), against -0.5 percent (and -0.1 percent) for large surfaces.
On the other hand, the sun is shining on the city of Marseille, where prices have risen by 5.4 percent since the beginning of January and have risen by a further 0.8 percent compared to last month. This reflects a renewed interest in this city, which is undergoing major changes (revitalization of the city center, extension of the tramway line, development of the Corniche Kennedy, etc.). Marseille is now attracting a new population of working people looking for greater real estate purchasing power. Since the confinement, the Phocaean city has attracted many Parisians, seduced by the 4th and 5th districts, but also people from Lyon and Bordeaux, with a definite appetite for properties with direct access to the outside, such as a terrace or garden, as even balconies are no longer sufficient.
Despite a significant increase in property prices, Marseille remains the second most affordable large city in France, just behind Montpellier. Apartments there are negotiated at 3,362€/m², three times less expensive than those in the center of Paris. In Marseille, the market remains as it was before the health crisis: dynamic, but also fragmented. More than ever, it is the 6th, 7th, 8th and 9th districts that are driving growth. Another sign of the good health of the Marseille real estate market is that buyers are quicker to make up their minds.
For the first time in Paris, the communes of the inner suburbs are falling back, with prices down by 0.2 percent in October. In one year, these same communes had recorded a price increase of 2.5 percent. The French seem to want to get as far away from the capital as possible. The departments of Île-de-France farthest from Paris have thus seen their prices increase by 5.2 percent over the last twelve months. And in the outer suburbs, Meilleurs Agents notes an average price increase of 0.4 percent this month.
My personal prediction: once the pandemic has fully subsided, our memories will be short and we will want to return to the cities where everything is easily accessible. So, NOW is a great time to buy in the cities!!
And for more information, visit meilleursagents.com.
LA GRANDE DAME GETS A FACE LIFT
Seven million visitors come to the Eiffel Tower every year, and about 20 million come to admire it without necessarily climbing it. These figures are staggering.
However, the current configuration of the site no longer allows it to welcome Parisians and tourists in satisfactory conditions. A vast operation to redevelop the site has been launched in order to create a new urban park in the heart of Paris and bring the Eiffel Tower up to international tourist standards.
The area around the Eiffel Tower will be thoroughly transformed by 2024. From the Trocadero to the École Militaire, the development and reception of visitors will be reconsidered. Priority will be given to green spaces and soft mobility.
To learn more, visit this site.
The Adrian Leeds Group®
P.S. Today we celebrate Armistice Day in France—the memorial day to honor the war dead following the Armistice at the end of World War I. Armistice Day is commemorated every year on 11 November to mark the armistice signed between the Allies of World War I and Germany at Compiègne, France, at 5:45 am, for the cessation of hostilities on the Western Front of World War I, which took effect at eleven in the morning—the “eleventh hour of the eleventh day of the eleventh month” of 1918. But, according to Thomas R. Gowenlock, an intelligence officer with the U.S. First Division, shelling from both sides continued for the rest of the day, ending only at nightfall. The armistice initially expired after a period of 36 days and had to be extended several times. A formal peace agreement was only reached when the Treaty of Versailles was signed the following year. The date is a national holiday in France, and was declared a national holiday in many Allied nations. (Source: Wikipedia.org)