Property costs in Ile-de-France: pattern nonetheless barely down in Paris

This is what you might want to keep in mind from the most recent financial report of the Notaries of Higher Paris on the Ile-de-France actual property market within the 1st quarter of 2022.

A really dynamic first quarter for condo gross sales

Gross sales volumes for older properties in Ile-de-France within the first three months of 2022 are regular (+1%) in comparison with the identical interval in 2021 and 12% greater than the common first quarter of the final decade.

Total, and past just a few much less constructive traits noticed by sure notaries at the start of the yr, the outlook stays constructive for the months forward. Furthermore, after three distinctive years, a decline in exercise will solely deliver a few return to normalcy.

Some regional contrasts took form in Q1 2022, with a Paris market confirming its dynamism month-to-month: there have been about 9,000 gross sales signed in Q1 2022, ie 8% greater than Q1 2021 and particularly in Q1 of 2012 to 2021. 13% greater than the common for the primary quarter.

In Q1 2022, condo gross sales have been consolidated in interior quarters (+1%) and suburbs (+2%) in comparison with the identical interval of 2021, in comparison with the final decade’s common (+7% and +23%, respectively).

However, the home market was much less dynamic after a reasonably distinctive interval. Nonetheless, value will increase verify the attractiveness of this market, which has been hampered by a scarcity of provide.

Decline in actual property costs in Paris: -1.2% in 1 yr

Residence gross sales volumes remained dynamic, whereas costs remained just about unchanged in a yr in Ile-de-France in Q1 2022, consistent with what was noticed in This autumn 2021.

Within the first quarter of 2022, the one-year value enhance for flats within the interior suburbs is restricted to 2%. In keeping with main indicators for preliminary contracts, this moderation will proceed and an annual enhance of lower than 1% is anticipated in June. and July 2022. Annual value development within the Higher Crown, which rose to 4.8% in Q1 2022, ought to return to 4% by July.

Worth erosion in Paris continues at a price very near that noticed between 2013 and 2015. The worth per m2, which was €10,600 in This autumn 2021, dropped to €10,520 in Q1 2022 and may proceed. It is going to launch round €10,500 by July 2022.

The strain of demand on housing because the begin of the well being disaster has resulted in a 5.7% annual value enhance in Q1 2022 and may rise to 7.2% in July 2022 in Ile-de-France. At the start of the summer season, the home in Grande Couronne would expertise the very best value will increase within the area.

Elevated uncertainties after varied shocks however short-term resilience components

The primary quarter of 2022 was marked by the outbreak of struggle in Ukraine, a tragic battle with geographically shut and a number of penalties. This main disaster strengthened manufacturing bottlenecks and tensions on uncooked supplies, amplifying the looming inflationary shock.

Due to this fact, economies are being put to a brand new and severe take a look at between the struggle and its penalties, the resurgence of Covid in some nations, the acceleration of inflation and the expectations of financial tightening, the limitation of entry to credit score and the rise in rates of interest. All these shocks deteriorated the financial outlook and additional weakened companies and households.

Nonetheless, the Ile-de-France property market remained resilient and buoyant, benefiting from sturdy demand and continuously renewed confidence from patrons. Within the first half of 2022, will increase in rates of interest appear to have additional inspired patrons to finish their purchases rapidly, their solvency has not been critically affected in the intervening time. Notaries suppose this motion is continuous and lots of households need to signal earlier than summer season.

Furthermore, the brand new financial state of affairs nonetheless harbors many uncertainties between rising rates of interest, that are nicely under inflation, and family incomes, that are at the moment largely unindexed. In the long term, the financial outlook appears much less safe. They’ll have an effect on a market struggling to get better from its structural weaknesses (non-renewal of housing inventory and thus lack of merchandise, tough challenge to decarbonize housing).

However in a quick perspective, actual property can proceed to withstand these crises by leveraging the belief of households, and greater than ever, it might probably proceed to be a secure haven, a bulwark towards inflation and insecurity.

A traditionally excessive actual property market and annual value development of simply over 2%

Gross sales volumes for current properties, 11% greater than the earlier 12 months, consolidate at a really excessive degree with 184,110 gross sales from Q2 2021 to Q1 2022. The annual value enhance throughout the area is decrease than inflation as a complete, restricted to 2.5% (Client Worth Index +4.8% in March 2022).

Evolution of home costs in Ile-de-France se prices round 6-7%

Because the chart under exhibits, the annual evolution of the costs of Paris flats (inexperienced curve) is mostly greater than that of homes within the Ile-de-France space (purple curve). For the reason that finish of 2020, the pattern has reversed, the annual development of home costs stays round 6-7%, whereas condo costs are step by step lowering.

Gradual improvement of flat costs (+0.9%) whereas gross sales volumes are near historic data

Mobility is dynamic and 13% greater than within the earlier 12 months, with 126,390 previous flats bought in Ile-de-France in 12 months. Within the 1st quarter of 2022, costs modified little (+0.9%) in a single yr, pushed by capital.

The autumn in Paris costs will nonetheless be offset by will increase within the suburbs

In keeping with preliminary contracts, condo costs within the Ile-de-France ought to return to the extent they have been a yr in the past in July. This stagnation in costs really masks geographic heterogeneity: In Paris, the autumn in costs must be emphasised, Worth modifications must be reasonable within the Inside suburbs, Worth will increase must be maintained within the Outer suburbs.

Excessive exercise degree (+5.7% in a single yr) placing extra strain on costs

With 57,720 previous properties bought in Ile-de-France in 12 months, it is traditionally excessive and 9% greater than the earlier 12 months. There’s a slight slowdown in annual value development (-1 level) in comparison with This autumn 2021, however the enhance in costs stays above 5% from Q1 2021 to Q1 2022.

Home costs in Ile-de-France ought to speed up once more within the coming months and enhance by greater than 7% in a yr

Ile-de-France properties ought to expertise a brand new heatwave this summer season. Costs could enhance by round 4% from April to July, leading to an annual enhance of greater than 7% from July 2021 to July 2022.

Paris market returns to a excessive degree of gross sales as costs proceed to erode every quarter (-1.2% in a single yr)

With an 18% enhance in gross sales in 12 months, the Paris market is undoubtedly essentially the most dynamic market within the area, because of the moderation in gross sales costs. Costs continued to erode and amounted to €10,520 per m2 in Q1 2022 (-1.2% in a single yr).

Costs in Paris ought to keep round 10,500 € per m2 within the coming months

In keeping with preliminary contracts, costs ought to change little within the coming months (+0.3% from April to July). Erosion in Paris costs could enhance barely (-2.1% from July 2021 to July 2022).

In Paris, costs The m2 of previous flats varies between 8.030 € and 17.400 € relying on the area.

Within the 1st quarter of 2022, costs per m2 vary from €8,030 (La Chapelle district in 18th district) to 17,400 € (Notre-Dame district in 4th district).

The Notre-Dame district is 2.17 instances dearer than the La Chapelle district (traditionally low price) and €9,370/m2 units them aside.

Costs per m2 vary from €8,830 in district 19 to €13,820 in district 6 (1.56 instances dearer than district 19, a traditionally low price). The fifteenth zone joins 5 distant zones within the east under the €10,000 mark per m2.

Downward value traits in nearly all areas

In keeping with the foremost Paris Notaries, 10 out of 17 districts noticed a major drop in costs, and solely district 5 elevated their costs by greater than 1% in a yr.

Excessive exercise for flats within the interior suburbs, particularly in Seine-Saint-Denis (+16% in comparison with common first quarter 2012-2021)

The condo market is dynamic within the interior suburbs (+1% in comparison with the primary quarter of 2021). Solely Val-de-Marne is in decline (-5% in a single yr).

Home market exercise plummeted in interior suburbs, probably because of lack of provide (-8%)

That is the least dynamic market within the area, particularly in Val-de-Marne. Gross sales volumes have been down 8% in comparison with the first quarter of 2021 and 4% in comparison with the common 1st quarter of the final decade.

An annual value enhance of round 2% in interior quarters

Annual value will increase within the first quarter of 2022 ranged from 1.3% in Hauts-de-Seine to three.8% in Seine-Saint-Denis. In keeping with preliminary contracts, the rise in costs could reasonable within the coming months and stay under 1% for all interior suburbs in July.

The slowdown in value will increase at the start of the yr (-0.7%)

Worth stability (-0.7%) from This autumn of 2021 to Q1 of 2022 precipitated a slowdown in annual value development. In keeping with preliminary contracts, nonetheless, costs could rise at a barely extra regular tempo within the coming months.

Very excessive steady gross sales volumes for Flats in Grande Couronne (+23%)

The variety of flats bought in Grande Couronne broke a file within the first quarter. As well as, gross sales volumes elevated sharply (+23%) in comparison with the common first quarter of 2012-2021.

Gross sales volumes stay very excessive regardless of declines (-6%) throughout all departments

In Q1 of 2022, the variety of transactions fell 6%, however that is in comparison with the wonderful Q1 of 2021.

A constant annual value enhance of roughly 5% in 1is is quarter 2022

In keeping with the preliminary contracts, value developments will differ within the coming months. Whereas the value enhance will decelerate and be restricted to 1.5% in Yvelines, it could enhance to nearer to 7% in Seine-et-Marne.

Greatest enhance in area, costs go from file to file (+7% in 1 yr)

Costs rose 6% from Q1 of 2021 to Q1 of 2022. In keeping with preliminary contracts, costs could enhance by about 4% in 3 months from April to July, and by greater than 7% in a yr, from July 2021 to July 2022.

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