Are house prices rising or falling in France?
France, like much of the world, has experienced a boom in property prices over the last few years - overall house prices have roughly doubled in the last ten years.
A visitor to the site yesterday asked if I knew what was happening at the moment with house prices in France. Based on living here and talking to people it is my belief that, in our region at least, sales have dropped off. I think that property prices haven’t been reduced yet, but that is common in a falling market - owners hang on as long as possible, hoping that a buyer will still come along.
Only after several months, when it becomes clear that isn’t going to happen, sellers start to reduce their prices. During those few months, sellers are not usually very receptive to low offers on their property.
The other thing that characterises this stage is the ‘unnatural exuberance’ that seems to possess estate agents, who talk in ever more optimistic tones about the property market, in an attempt to keep things moving. I think they never succeed at this, but what else can they do? Tell the truth? Bah! The best an estate agent will admit is that ‘the rate of price increases might slowdown a little, but we are confident prices will continue to rise’.
At the moment I believe we are at this stage - there are few buyers, and very few purchases going through. Prices for some properties were already unrealistic, especially for ruins. Now they are very unlikely to be achieved in the next year or two. But it’s not impossible that prices will flatten off a bit rather than fall - there are still relatively few attractive, desirable properties for sale in France and demand may continue to exceed supply. There are still lots of people looking for ‘nice’ properties and struggling to find them.
To end on a more upbeat note - I have no concerns at all about the long term value of property in France; there are still, as always, bargains to be had - although they can be pretty hard to find now; and prices are still often absolute bargains compared to the prices of similar properties in the UK.
So despite the doom and gloom, and the knowledge that if you buy a house now it might be worth a bit less in 12 months time, I say still go for it! A year of sunshine and sitting on your terrace sipping wine and you really won’t care less how much your house is worth - that is a promise!
