Fall in real estate prices expected in 2024, number of building permits accepted, energy renovation work…. Find 5 astonishing figures on the French real estate market.
Real estate prices are falling for the year 2023. A trend which will accentuate and even accelerate in 2024 with an expected drop of -4%, according to Meilleurs Agents.
1 – The price of the old one falling
This hasn’t happened since 2015. The prices of the old ones are falling throughout the territory. On average in 2023, they will decline by -1.8% after an increase of 4.6% in 2022. According to the experts of the site Meilleurs Agents, it is now necessary to pay 3923 euros per mthe same level as in May 2022. It is obviously in the large cities that the decline is most obvious and in particular Paris (-5.3%) where you have to pay 9,644 euros per m on January 1 of this year. Nantesthe decline rises -8% bringing the price per m2 to 3751 euros.
The decline in prices is misleading because if we exclude the Paris region, real estate prices only fell by -1% in the rest of France, far from the 10 to 15% drop necessary to revive the market, estimates the Century 21 network in an analysis published this Monday.
2 – Prices will continue to decline in 2024
The decline in property prices is expected to continue in 2024. One of the conclusions to be drawn from this year is that the decline in prices has only just begun. Sectors still preserved such as rural areas, which experienced an initial decline over the last month, are proof of this. In other words, territories which, during the first eight months of the year, had continued to benefit from their post-health crisis aura to progress, are now feeling the wind turning, specifies Thomas Lefebvre, scientific director of Meilleurs Agents.
Even if the real estate rates which are stabilizing today should fall further in the coming months, they will be still above the average levels of recent years. Best Estimated Agents 4% decline in real estate prices for 2024, a rate twice as high as the year goes by.
Real estate: here’s how much prices will fall in 2024 after the 2023 drop
3 – The number of transactions also decreasing
Sales volume is actually down in 2023 passing below 900,000 transactions (875,000 exactly) for old housing, a quarter less compared to the year 2022. According to figures from the National Real Estate Federation (Fnaim), the annual drop reached 21.5% for the past year, the biggest drop in volume observed in 50 years, according to Loc Cantin, president of Fnaim in things. In 2024the decline will continue and the number of transactions should increase 800,000 approximately.
4 – Drop of more than 25% in the number of building permits
The volume of building permits fell in 2023, reaching 372,500 permits issueddown by -25.5% compared to 2022, a consequence of the decline in the real estate purchasing power of households and the increase in construction prices. The drop in the number of authorizations issued concerns as much individual accommodation (-31.7%) than housing estates (-25.1%) via the collective (-24.8%) and senior and student residences (-11.8%). The volume of construction sites started which normally follows permit acceptances also recorded a drop of -19.6%.
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5 – Real estate loan rates rising sharply
Real estate loan rates have increased sharply in recent years and even more so in recent months. According to the latest figures from the Observatoire Crdit Logement/CSA, average interest rates on property loans increased from 1.19% in November 2020, 4.22% in November 2023.
The average loan duration has also extends to reach 247 months (i.e. a little more than 20 years), a level rarely observed in the past, testifies to the Observatoire Crdit Logement/CSA. But this lengthening is not, however, not sufficient to offset the impact of current price levels housing and interest rates or cushion the impact of the level of personal contribution rates required on the borrowing capacities of households.