PARISIAN REAL ESTATE
Evolution and perspective of the market
According to the figures of notaries council, there is a high activity and prices are still rising in PARIS and Ile de France
This increase in sales is also due to historically low interest rate
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The low rates * loan motivate also the aspirants to property, we notice a real craze for real estate investing of the French with two years: 2016 and 2017 showing very positive results
* 15 years loan : 1.15 / 20 years loan : 1.35 / 25 years loan : 1.55 / 30 years loan : 1.95
According to a recent survey, the Y Generation is willing to own property: among young tenants: 69% want to become landlord in the next 5 years
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The price of old housing has risen to an average of 3.8% (Average price in Ile de France 5460 € per m²) in Ile-de-France, the number of sales of old housing in Q2 2017 has increased by 20 % compared to the same period in 2016
Paris is experiencing faster price increases
In the capital, the price per square meter was 8 430 € in February 2017 with an average increase of 5.2% over one year, in the second quarter, of 8 670 € which will approach 8 900 € at the end of the year
For 25 years, the prices of Paris have not stopped becoming homogenized (only 3 districts cost less than 8 000 € per square meter: 18, 19 and 20 districts against 6 a year ago)
The former affordable neighborhoods of the capital get valued more and more rapidly
As for the Marais district, the prices are in constant progression, exceeding the average price of 11 000€ / square meter:
Paris 3rd: 11 030€ + 5.3% with an evolution of 14% over one year in the sector Enfants Rouges)
PARIS 4t: € 11,520€ + 2.9% with an increase of 10% over one year in specific sub districts: Arsenal and Ile St Louis
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No deceleration is expected because the effect of tight stocks prevails on this very desirable district of the City of Light
In luxury real estate, Paris remains very attractive compared to other cities in the world: with an average price per square meter between 12,000 and 18,000 euros, Paris ranks 8th, behind San Francisco, Singapore, Shanghai and New York. Hong Kong reaches the top (not far from 40,000 euros per m² on average), followed by Tokyo (about 30,000 euros per square meter) and London (about 15,000 euros per m2), as the site Les Echos reminds us.
This study underlines that the prices recorded in the 1st, 4th and 5th arrondissements have already exceeded their 2012 peak.
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Buyers' confidence is also boosted by a new political regime (President Emmanuel Macron was elected in May 2017) and increased consumer confidence.
But also with the return of international buyers: 1 in 10 in the luxury segment with nationalities mainly American, Swiss, Belgian and European
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How to explain this improvement? the exceptionally low interest rates and the tense real estate market, but also the financial markets on the rise, with growth underpinned by the improvement in the global economy stronger than expected, with an acceleration of the US economy and growth of the euro zone to more than 2%
Perspective: stabilization of the market no bubble burst expected since the evolution has been smooth
The chamber of notaries indicates in particular that the current situation is not a "bubble" transient, but a catch-up effect after several years of wait-and-see attitude among buyers.
This exceptional activity could be confirmed, with the future Olympics Games in 2024 …
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