Fall in real estate prices: the French, between obligation and wait-and-see attitude

Margaux Fodéré / Credits: Mathieu Thomasset / Hans Lucas / Hans Lucas via AFP 7:10 a.m., April 8, 2024

The real estate market continues to show some signs of recovery. After the rate cut, prices also began to fall, particularly in the capital. According to Century 21, the price per square meter decreased by 9% on average in Paris between the first quarter of 2023 and the first quarter of 2024. Enough to allow certain French people to relaunch their purchasing plans. Even if most still prefer to wait for the decline to deepen. 

For a few weeks, the phone has started ringing again in the Century 21 real estate agency on rue Monge, in the heart of the Latin Quarter. The visits follow one another and they sometimes lead to offers, as Thomas Blanchot, the associate director of the Century 21 agency, explains. "On the desk there are 6 files in progress, these are mandates that we have taken a few months ago, and there in one week we had six people who came and who decided to make an offer to purchase these apartments. In December on the desk you would have come, there was 0 files" .

“Forced” transactions

Behind this recovery is the fall in rates and that of real estate prices. In the 5th arrondissement, they have decreased by 10% on average since the start of the year. A trend which has allowed some French people to return to the market, even if others prefer to wait. "Those who are currently on the market are those who are forced, namely divorces, deaths, births: there are two of them in a studio, the lady gives birth to twins for example, very clearly the studio is too small so they obviously have to buy. The buyers and sellers who we have not yet found are those we call 'comfort buyers or sellers'. The one who simply wanted to have 10 square meters what's more, he's still waiting."

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A market still waiting

First-time buyers are also waiting for rates and prices to fall further. But it will not be before the end of summer according to Thomas Blanchot. Especially since another obstacle still limits transactions in the capital. "It's the arrival of the Olympic Games in Paris. It's blocking certain transactions. It's blocking certain buyers who will wait until September to be able to buy and do work. And it's blocking certain sellers who will wait until the end of the Olympics to set up their small space on sale". 

Once the event has passed, he is hopeful that average prices in this area will fall back below 11,000 euros per square meter. And that the market starts again for good at the start of next year.