House prices in France

What's hot and what's not

The French housing market's recovery in 2016 and 2017 has been very marked, but it has not been evenly spread across the country.

Paris, unusually, is no longer top of the list for price rises, though it still comes close. Instead, the thriving cities of Bordeaux, Lille, and Lyon are seeing the greatest growth in property prices. However, there's also a list of laggards as some cities are not getting the benefit of a rising market - while Toulouse is still doing well at 4%, Marseille (+1.3%) and Nice (+0.6%) are falling behind.

Several areas are seeing price falls. Limoges and Tours are slightly down, but Doubs, Perpignan, Clermont-Ferrand and Besançon are seeing more significant declines, while Le Mans is left far and away the loser with a fall of 6.7% in asking prices in the year to March 2017.

% increase in asking price, year to March 2018% increase in asking price, year to March 2018
Nantes+6,5Le Mans-6,7

Source: LPI/SeLoger


How much below asking price to offer in France? Is cash buying giving bigger discount?
In the market for resale properties you are free to make an offer lower than the asking price. 10% below the asking price is not uncommon. However, in a fast moving property market with constrained supply, like central Paris or Bordeaux, you may be disappointed by the response. For new developments, you may get a special deal if you are among the first buyers - the promoters need to sell a certain number of units before they can start construction. However, you're more likely to get added features or higher specification of finish than cash; you might also get your notaire's costs paid. At the other end of the development cycle, the last flats in a development could sell for a discount of up to 10%. Because of the clause suspensive regarding finance, a cash buyer does not offer the same advantages to the seller as in the UK, and discounts are likely to be limited to 3-5% off the asking price.

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Rental yield, %:

Yield, %
Le Havre6,3

Source: FNAIM

Investment buyers might be more interested in the relationship between sales prices and rental levels. While a Paris apartment, rented out, will make the landlord less than 4%, there are a number of French cities where rental yields remain significantly in excess of 6%. Buyers need to do their homework though; although Saint-Etienne offers a 9% gross yield, it can take four months to find a new tenant, against just 33 days in Paris.

Buyers looking at rural properties will find that some departments cost significantly more than others. Obviously, rural properties within commuting distance of Paris will be relatively highly valued, not just in the Ile-de-France but in pockets of neighbouring departments such as Eure and Eure-et-Loir which have access to good train connections.

The same goes for areas close to major cities such as Toulouse, Bordeaux and Lille. However, whole areas of central France (Limousin and the Massif Central) remain generally undervalued, as well as parts of Brittany.

Rental levels tend to follow property prices. Paris is by far the most expensive city to rent in, even outside the centre of the city, with a three bedroom city centre apartment costing well over EUR 2,000 a month. In Toulouse, the same apartment would set you back only EUR 1 100.

Monthly rent for apartments, EUR:

Monthly rent for 3 bed city centre apartment, EURMonthly rent for apartment outside city centre, EUR
Paris2 3961 692
Lille1 020789
Lyon1 254911
Nice1 3581 060
Toulouse1 096791

Source: Numbeo