FNAIM reports that positive performance in select residential real estate markets across France were not enough to keep the national average from reflecting an overall drop in sales and growth. Total growth slipped 0.8% in 2012 and FNAIM analysts are projecting another 2% dip this year. Although realtors believe French sellers will start pricing their properties more precisely, the prevailing attitude is that strength will return to the market. This despite many regions like Brittany and Normandy that saw significant drops in home value and waning interest from typically active foreign buyers. For more on this continue reading the following article from Property Wire.
Property price growth slowed to 0.8% in France in 2012 and is set to fall by 2% nationally this year, according to the latest figures from the FNAIM, the national federation for estate agents in the country.
But the figures do mask some regional differences. For example Languedoc-Roussillon recorded an overall 0.5% property price increase with houses up by 1.8% in the fourth quarter of 2012 compared with the same period in 2011.
The Ile de France, the area around Paris also saw annual price growth, up 1.5%, but there is a difference depending on property type. In the area house prices actually fell by 0.1% whereas apartment prices were up 2.6%.
Champagne-Ardennes was one of the few areas to see prices of both houses and apartments rise, up 0.6% and 0.9%, while Poitou-Charentes saw apartment prices rise by 2.6% but house prices fall by 5.6%.
Normandy and Brittany, which are popular areas with overseas buyers, have been one of the hardest hit in terms of price falls. In Brittany house prices fell 6.4% and apartments by 2.95%. In lower Normandy house prices were down by 5.3% and apartments by 6.5%. In neighbouring upper Normandy apartment prices fell by 6.5% but house prices rose by 1.5%.
Even in PACA in the south of France which includes the French Riviera which is also popular with overseas buyers, house prices fell by 0.6% but apartment prices were up by 1.7%.
Picardie, Lorraine, Alsace, Centre, Nord Pas de Calais, Pays de la Loire and the Midi Pyrenees all saw house and apartment prices fall.
In terms of sales the full transaction figures for 2012 are not yet available but the FNAIM estimates that they will probably have fallen by around 18.6% nationally.
However, with prices down, agents believe that more international buyers might be tempted to take advantage of bargains. ‘The onset of Spring in France has traditionally been the time that international buyers reappear looking to snap up a bargain. 2013 is no exception and our agents are reporting increased activity right across France,’ said Trevor Leggett, chief executive of Leggett Immobilier.
‘The penny (or centime) seems to have finally dropped that home owners and agents should price sensibly and we are seeing some terrific bargains being snapped up by clients. We have seen a 31% growth in sales over this time last year and our call centre team are reporting an increase in viewings booked in the run up to Easter,’ he explained.
‘Perhaps the fact that the weather in the UK has been so poor this winter has also added to the increase in demand from British buyers who have brought forward their plans to find a dream home in the sun. The budget that George Osborne announced last week is likely to indirectly help stimulate demand too,’ he added.
‘It’s clear that bargains are to be had across all price ranges at the moment but my personal view is that it’s the top end that has most to offer, anything over €600,000 will have to be priced keenly to sell,’ he pointed out.
Danny Silver, founder and managing partner of The Villages Group, which specialises in properties for those seeking retirement homes with an active lifestyle, believes that growth in areas like Languedoc-Roussillon where the firm’s new Villages project is located will continue to see growth in 2013.
Indeed the French themselves remain confident in their market with 77% of nationals surveyed in the latest European real estate assets investment trend indicator 2013 from Ernst & Young agreeing or moderately agreeing that investment activity by international real estate investors will increase in 2013 compared to 2012.
‘France has, for many years, been and will remain one of the most stable property markets in the world. Compared to some markets such as neighbouring Spain, a slowdown in house price growth to 0.8% is nothing and as long as buyers choose the right property, in the right location, for the right reasons then they should not be concerned,’ explained Silver.
This article was republished with permission from Property Wire.