Paris The 42-year-old Franco-German lifestyle journalist Estelle Marandon was tired of Paris. With her husband, the film producer Mathieu Robinet (40), and their three children, she moved to Cély near Fontainebleau, around 60 kilometers south of the capital, during the pandemic.
“Paris had become too small for us, we wanted more nature. Before we didn’t have a balcony, now we have 5,000 square meters of garden and a forest,” says Marandon. The family sold their 84-square-meter apartment in Paris and bought a 400-year-old mill with around 300 square meters of living space. And the new property was a third cheaper than the apartment in Paris, where the average price is around 11,000 euros per square meter.
The home office triumph makes it possible and it is turning the French real estate market upside down. Between Normandy and the Mediterranean, holiday homes have become scarce and expensive. Above all, luxury real estate knows no crisis.
The price increases on the Atlantic coast are particularly exorbitant, but Normandy is also becoming more and more popular. These are often the second homes of French city dwellers who relocate their home office to the countryside.
Top jobs of the day
Find the best jobs now and
be notified by email.
The Atlantic coast is becoming increasingly popular; according to industry information, it has experienced an increase of 28.3 percent to an average price of 5376 euros per square meter in the past two years. For some time now, the express trains have made it even quicker to get to the west of the country. Up to now, the south has been particularly easy to reach.
Many interested parties are looking for domiciles in cooler regions
Even if many are looking for the sun in the south, there is a counter-movement in view of the increasing heat waves. For more and more buyers, the cooler temperatures in Normandy or along the Atlantic coast are playing a role in their purchasing decisions. The area around Bordeaux is very popular because it is easy to get to from Paris.
Many of the buyers want a second home for a break from the big city.
(Photo: imago images/blickwinkel)
“Parisians make up 85 percent of customers around Arcachon,” explains Thibault de Saint-Vincent, president of luxury real estate specialist Barnes. Many were not just looking for a holiday home, but a second home. The buyer profile: CEO, executive, entrepreneur of a start-up, freelancer or banker with a budget of 2 to 2.5 million euros from Paris or a large European city.
“The trauma of the lockdown is still present. Households that have the financial means tend to invest in the seaside resorts of southern France to take advantage of the sun,” analyzes Stéphane Fritz, President of the Guy Hoquet real estate association. The rush is particularly great at the moment, everyone still wants to benefit from the relatively low interest rates before they continue to rise.
How long will the boom last?
The question is how long the boom will last. In cities like Paris, prices that have been rising for years are already stagnating. The situation could spread to all of France, real estate expert Fritz fears, possibly as early as autumn.
Prestige properties throughout France also play a very special role in the holiday home boom. They have been in high demand over the past two years. On the Côte d’Azur, the purchase prices for luxury homes rose again by 10.5 percent in the period, the average price for the segment is 10,912 euros per square meter. In the hinterland, in Provence, where it is still a bit cheaper, there was even an increase of 23.2 percent to 4732 euros.
>> Read also: The luxury problem: Investments in top villas are so risky
In Brittany, too, you can no longer get bargains like you did two years ago. The purchase prices for luxury properties there have increased by 29.3 percent to 4977 euros per square meter in the past two years. Normandy also experienced a boom with growth of 21.2 percent, which can be easily reached by train in two hours from Paris. The prices of an average of 7012 euros for luxury real estate reflect this proximity. In the Alpine regions, there was an increase of more than 16 percent to 7216 euros per square meter.
French buyers dominate the luxury real estate market
France can apparently do without the rich Russians, because 90 percent of the market for prestige real estate with a purchase price of more than one million euros in the country is made up of French people. However, foreigners are somewhat more present in the segment than in real estate as a whole. According to the Belles Demeures portal, buyers are mainly looking for houses, not apartments.
Nobody thinks about a crisis in this segment. Luxury real estate is seen as a safe investment in times of inflation and geopolitical crises. 68 percent of the future buyers surveyed believe that prestige real estate is a worthwhile investment. Even in the luxury sector, buyers are looking for a new living environment with more space and a garden. In Paris, on the other hand, the prices for luxury real estate have fallen by 2.9 percent in two years and come to an average price of 14,462 euros per square meter.
If you have the means, buy on the south coast of France.
(Photo: picture alliance)
Foreign investors in France represented 5.9 percent of total property buyers in 2019 before the pandemic, down slightly. The British were in first place in 2020 with a share of 22 percent, with a sharp downward trend. The Belgians came second with 20 percent. The Germans then followed in third place with nine percent, and the trend is rising.
The three most popular regions for foreign buyers, particularly the British, Belgians and Dutch, are inland, between Limoges and Bordeaux, with the Mediterranean coming in fourth overall.
In France, high taxes are due on houses and apartments
Anyone who buys in France should not underestimate the high taxation of real estate and especially holiday properties and take a close look at the property taxes, which have risen significantly in some municipalities in recent years. There are huge differences in municipal taxes. If you have a second home, you still have to pay the residence tax (taxe d’habitation) in addition to the owner tax (taxe foncière). For main residences, on the other hand, the residential tax will no longer apply from 2023. Increases in the owner tax are therefore also expected.
>> Read also: War in Ukraine and rising costs continue to weigh heavily on the real estate market
That doesn’t deter families like that of journalist Marandon, however. They feel at home in their new home in the countryside. The nearest train station is 20 minutes away by car and the train journey to Paris takes half an hour. “Having to go to Paris every day would be exhausting, but it’s perfect for a freelancer,” she says. Here in the forest near Fontainebleau, the family met designers, restaurateurs and musicians, all of whom have left Paris.
More: Holiday homes are still affordable here