2024

<p>The French real estate sector is going through a major crisis, surpassing the darkest scenarios. The latest statistics from Notaires de France reveal a sharp slowdown in transactions and a general devaluation of real estate assets.</p> 
<h2 id="h-historical-decline-in-sales">Historical Decline in Sales</h2> 
<p>The volume of <a href="https://www.cointribune.com/en/crypto-shiba-inus-transaction-volume-is-exploding-despite-market-turbulence/" target="_blank" rel="noreferrer noopener">real estate transactions</a> is collapsing. With only 793,000 sales of old homes in the last twelve months ending in May 2024, there is a decrease of 22.6% compared to the previous year. The market has not seen such a level since December 2015.</p>
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<p>Edouard Grimond, spokesperson for the Superior Notarial Council, <a href="https://www.lopinion.fr/economie/ventes-immobilieres-douche-froide-ce-sera-pire-que-prevu" target="_blank" rel="noreferrer noopener">expresses</a> his concern: “<em>We anticipated a decline in sales, but not to such an extent</em>“. The forecasts for the end of the summer are even more alarming, with a risk of falling below the 750,000 annual transactions mark.</p> 
<p>This downfall is explained by several factors:</p> 
<ul> 
 <li>Tightening of mortgage lending conditions</li> 
 <li>Unstable economic conditions and persistent inflation</li> 
 <li>Decline in household purchasing power</li> 
 <li>Political uncertainty following the dissolution of the National Assembly</li> 
</ul> 
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<h2 id="h-generalized-depreciation-of-real-estate">Generalized Depreciation of Real Estate</h2> 
<p>The <a href="https://www.cointribune.com/en/crypto-is-the-ecbs-rate-cut-blowing-a-favorable-wind-on-the-market/" target="_blank" rel="noreferrer noopener">decline in prices</a> is increasing across the entire territory. In the first quarter of 2024, old homes lost 5.2% of their value over a year in mainland France, affecting both apartments (-5.5%) and houses (-4.9%).</p> 
<p>The Île-de-France region is particularly affected with a drop of 8.1% over a year. In Paris, the average price per square meter fell to €9,490, a decline of 7.9%.</p> 
<p>Projections for the end of August 2024 predict a stabilization of the decline around -4.8% over a year. However, some metropolises such as Lyon, Nantes, or Tours have already recorded declines exceeding 10% for apartments.</p> 
<p>The new construction sector is not spared. Housing starts and building permits show respective decreases of 21.5% and 15% over a year. New home sales and reservations are also collapsing by 38% and 25%.</p> 
<p>This unprecedented real estate crisis raises many questions about the future of the sector and its repercussions on the <a href="https://www.cointribune.com/en/french-economy-moodys-deals-a-heavy-blow-to-the-government/" target="_blank" rel="noreferrer noopener">French economy</a>. The start of September 2024 will be decisive in determining whether the market can rebound or if the downward trend will continue.</p>

Economy: The French Real Estate Market is in Turmoil

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Cointribune EN

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