The first half of 2024 brought significant changes to the real estate market in France. Economic instability, rising interest rates and new environmental standards have significantly impacted supply and demand, resulting in uneven price changes across the country. While some regions and cities have experienced marked declines in housing costs, others have seen prices remain stable or even rise slightly. In this article we will look at the key trends in real estate prices in France in the first half of 2024.
Falling prices for apartments in major cities of France
Prices for apartments throughout France decreased by 2.1% over the year, and at the beginning of 2024 the average cost per square meter was €3.835. The greatest changes have occurred in cities with traditionally high prices. It is noteworthy that the decline was most noticeable in the western part of the country, which may indicate a redistribution of demand and buyer interest.
Among the cities with the largest drop in prices are the following:
- Nantes – decrease by 9%, average price – 3.395 €/m²;
- Nim – a fall of 7.7%;
- Merignac – minus 6.6%;
- Bordeaux – a decrease of 5.7%, although in the first half of 2024 the decrease was only 2.6%;
- Paris – prices fell 5.7% for the year, but for the first half of the year the decline was 1.4%.
In major cities such as Bordeaux and Paris, the rate of decline began to slow in the first half of 2024. This may be due to the traditionally high demand for housing in these regions, as well as seasonal fluctuations in demand.
House prices: sharp drop in certain regions
The situation with house prices turned out to be even more heterogeneous. Although the average price of mansions remained virtually unchanged (up just 0.3% from the previous year), a number of cities saw significant fluctuations. For example, in Avignon prices fell by 15.4% over the year, and in Metz – by 10.8%. In these cities, the average cost per square meter is now €2.285 and €2.473 respectively.
On the other hand, in cities such as Toulon, Nimes and Rouen, prices have remained virtually unchanged. Some places, such as Pau, Tourcoing and Roubaix, even saw prices rise by more than 5%.
Top cities with falling house prices:
- Avignon – minus 15.4%, average price – 2.285 €/m²;
- Mets – minus 10.8%;
- Pau, Tourcoing, Roubaix – growth of more than 5%.
Thus, the French house market in the first half of 2024 showed significant differences depending on the region.
Forecasts and prospects for the real estate market
Despite the general drop in prices, experts did not predict a significant recovery in the real estate market in the near future. One of the factors that restrains the growth of demand is high interest rates on mortgages, which still remain at a level that is not conducive to increased purchasing activity. Experts predict that to resume the growth of transactions in the market, a continued reduction in prices is necessary, since current levels still do not motivate buyers. Importantly, the downturn in the construction sector is making matters worse, with building permits down 15.3% year-on-year through June 2024. New environmental standards and rising costs of building materials are also putting pressure on the new construction market.
Speaking about the French real estate market in the first half of 2024, three main conclusions can be formulated:
- Prices for apartments and houses fell in most major cities, but unevenly.
- High interest rates have held back demand despite falling prices.
- The construction sector is experiencing a crisis, which may affect the supply of new properties.
The French property market has experienced turbulent times in the first half of 2024, and its further development will depend on economic factors and changes in consumer sentiment.