Even if most real
estate professionals are likely to raise the probability of a sharp decline in
housing prices in 2013, all observers do not share that view yet. In
a recent study on the French property market, the research firm Xerfi excluded
all published prices, preferring to rely on the relative stability of actual
sale prices.
While the scenario of a significant drop in property prices is favored by a large number of professionals (Crédit Foncier predicting for 2013 and a decline of around -5 to -10%), some voices however carry a different tune. This is particularly the case for Xerfi, the economic research firm who does not hesitate to take against the general opinion in saying that "despite government measures to curb the recent rises, house prices in France will remain at a high level in the new build market as in the market for existing properties. '
In the study released recently Xerfi assert relative price stability for at least the next two years. These should register a marginal decline of 1.1% in 2013 and -0.4% in 2014. According to the firm the weakness in new developments should greatly influence the price as this level of new property building will not address the structural deficit of housing and help to limit price declines. '
If these figures are national averages, house prices should nevertheless adopt relatively disparate developments by region. While Paris and Ile-de-France, combining economic attractiveness and notable lack of new housing should see their prices remain at a high level, regions such as Alsace and the Rhône-Alpes will see a slight decrease in price owing to the larger numbers of new developments in those areas. John Busby of French Private Finance agrees with this, though does not think prices in the main ski stations will suffer. "The popular areas of France should remain stable due to the inwward investment by overseas buyers. French mortgage rates are at their lowest ever level which should maintain the flow of investment into these areas as buyers take advantange of the excellent long term French mortgage options available at 80% of the purchase price.
Overall house prices are likely to persist at this level for the medium term if sales volumes continue their downward trend. According Xerfi, we will have to wait until 2015 to see the beginnings of a recovery, both in regard to the price that the number of transactions.
While the scenario of a significant drop in property prices is favored by a large number of professionals (Crédit Foncier predicting for 2013 and a decline of around -5 to -10%), some voices however carry a different tune. This is particularly the case for Xerfi, the economic research firm who does not hesitate to take against the general opinion in saying that "despite government measures to curb the recent rises, house prices in France will remain at a high level in the new build market as in the market for existing properties. '
In the study released recently Xerfi assert relative price stability for at least the next two years. These should register a marginal decline of 1.1% in 2013 and -0.4% in 2014. According to the firm the weakness in new developments should greatly influence the price as this level of new property building will not address the structural deficit of housing and help to limit price declines. '
If these figures are national averages, house prices should nevertheless adopt relatively disparate developments by region. While Paris and Ile-de-France, combining economic attractiveness and notable lack of new housing should see their prices remain at a high level, regions such as Alsace and the Rhône-Alpes will see a slight decrease in price owing to the larger numbers of new developments in those areas. John Busby of French Private Finance agrees with this, though does not think prices in the main ski stations will suffer. "The popular areas of France should remain stable due to the inwward investment by overseas buyers. French mortgage rates are at their lowest ever level which should maintain the flow of investment into these areas as buyers take advantange of the excellent long term French mortgage options available at 80% of the purchase price.
Overall house prices are likely to persist at this level for the medium term if sales volumes continue their downward trend. According Xerfi, we will have to wait until 2015 to see the beginnings of a recovery, both in regard to the price that the number of transactions.
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