Is the movement of falling real estate prices in Ile-de-France already coming to an end? This is not excluded, according to the figures from Greater Paris notaries published Tuesday May 28. These data present a paradoxical picture.
The real estate market remains in fact affected by the sudden rise in interest rates that occurred almost two years ago, in the wake of the war led by Russia in Ukraine. In the first quarter of 2024, the sales volumes of old housing in the Paris region fell by 24% compared to the first quarter of 2023, and especially by 40% compared to the first quarter of 2022.
Activity is experiencing the same trend on a national scale: the number of transactions carried out over the last twelve months continues to fall, with 822,000 sales at the end of March 2024, after 869,000 transactions at the end of December 2023 and 931,000 transactions at the end of September 2023 , according to the Notaries-Insee index.
And yet, while goods for sale accumulate but cannot find buyers due to prices, they are showing signs of stabilization. Certainly in the first quarter, the clock was still on the decline. Prices in France are falling for the third consecutive quarter (–5.2% in the first quarter of 2024, year-on-year). The fall appears even greater in the Paris region (– 7.9% for apartments and – 8.4% for houses).
“More tolerable” inflation
The price per square meter of Parisian apartments now stands at 9,490 euros, well below the symbolic bar of 10,000 euros. Compared to the record of November 2020, the square meter has decreased significantly, by 12.6%.
However, a break is in sight. Leading indicators from Ile-de-France notaries on preliminary contracts show that prices could stagnate for apartments and even increase for houses from April to July 2024. In Paris, prices should stabilize around 9 400 euros per square meter by July. “This movement, very clearly visible on the price curves, can be observed across all of the Ile-de-France markets”note the notaries of Greater Paris.
For Elodie Frémont, spokesperson for the Chamber of Notaries of Greater Paris, “since the start of 2024, some lights have in fact turned green again: interest rates have stabilized and even started to fall and inflation is becoming more tolerable”. The profession wonders whether expectations of a rate cut would not lead to “salespeople to be less accommodating” on price reductions.
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