Baino Estates LLC: French Real Estate's New Frontier
In the initial quarter of 2023, the French secondary real estate market witnessed a considerable appreciation in value, with a year-on-year increase of 7.3%. This data was disseminated by the official notary portal of France. A striking trend observed is the accelerated rate of price increase for villas compared to apartments, with houses experiencing a 9.3% rise and apartments a 4.7% increment over the year. The mean transaction cost for secondary housing during this period stood at 2440 euros per square meter.
The development sector is currently encountering challenging circumstances, primarily due to a global escalation in the prices of construction materials and overall building expenses. In conjunction with increasing interest rates and the escalating cost of living, the primary housing market is gradually becoming less accessible to a broadening demographic. Consequently, private investors are progressively orienting their focus towards the secondary market, as per the analysis of Baino Estates LLC.
In terms of affordability, the ten most economical secondary real estate markets in France are as follows: Orleans (Centre - Loire Valley) at an average real estate price of €220 thousand, Montauban (Occitania) at €219 thousand, Saint-Etienne (Auvergne - Rhone - Alps) at €215 thousand, Le Havre (Normandy) at €198 thousand, Rouen (Normandy) at €189 thousand, Poitiers (New Aquitaine) at €185 thousand, Limoges (New Aquitaine) at €179 thousand, Troyes (Grand Est) at €178 thousand, Amiens (Hauts-de-France) at €175 thousand, and Chateauroux (Centre - Loire Valley) at €125 thousand.
The regions exhibiting the most rapid asset capitalization in the French secondary market in the first quarter of 2022 include Nancy (Grand Est) with a 15.3% annual increase, Nimes (Occitania) with 14.7%, Montauban with 14.6%, Brest (Brittany) with 14.0%, Marseille with 12.8%, Chartres (Centre - Loire Valley) with 12.4%, Angers (Pays de la Loire) with 9.4%, Tours (Centre - Loire Valley) with 9.2%, Lille (Hauts-de-France) with 9.1%, and South Corsica with 9.1%. Conversely, the most sluggish growth in housing prices was observed in Toulouse at 5.9%, Ile-de-France at 5.7%, Grenoble at 5.2%, Orleans at 4.8%, and Saint-Etienne at 0.1%. Additionally, five agglomerations experienced a year-over-year decline in prices: Dijon (Burgundy - Franche-Comte) by 1.3%, Amiens by 2.5%, Metz (Grand Est) by 3.0%, Chateauroux by 3.8%, and Poitiers by 6.0%.
Given the complexities currently plaguing the primary market, the French secondary real estate market is emerging as a progressively promising arena for investment.
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