The Outlook for the French Property Market in 2021
What an extraordinary year this has been and like most business sectors, Covid hit the French property market very hard with activity virtually at zero during the first lockdown in the Spring. The official French statistics body, INSEE, has reported that in the middle of ‘confinement’, there was a complete slump in French property transactions with virtually no sales being recorded between March and May 2020, mainly because most estate agencies and Notaire’s offices were closed.
This was in sharp contrast to the beginning of 2020 when the market had been growing steadily year on year for five years straight. According to the Notaires of France latest French property market analysis (link below) from 2015, the number of house sales transactions rose for 20 quarters at an average pace of between +3.5% and +5%. And in the 12-month period to April this year, the number of house sales topped one million for the first time ever (1,068,000 house sales).
Notaires.fr: French property market analysis 2020
Since the lifting of the lockdown in France in mid-May 2020 however, the property market has been very busy. According to the same Notaires.fr report, from 2019 to 2020 the average selling price across France increased by +5.8%. The report goes on to say that ‘there has been a strong rebound in terms of post-confinement signings of pre-contracts, and notaries witnessed strong activity through to mid-August 2020”. The report continues: ” . . . the data clearly shows the resilience of the property market in France, despite the threats posed to the job market by the health crisis in the short term . . . notaries in most regions of France currently confirm the public’s very strong appetite for property purchases . . .”
INSEE Q2 2020 Housing Market France
The difference however in the current market as compared to the previous five years is that, post lockdown, the trend has seen a clear shift away from urban living to more rural areas. This is likely driven both by the wish for more space following confinement and the shift to working from home. Many people have discovered that they can just as easily work remotely and have now decided that they would like to continue doing so. This opens up a much larger geographical area of choice which is driving property decisions and it is very clear that space, natural environment and quality of life are being prioritised over the convenience of living in a city or town.
Whether this trend will continue in 2021 is hard to predict but certainly it looks as if there has been the kind of step change in the French property market that happens only once every few decades and it feels as if this one might be a permanent shift.
Whatever happens here in France and in other parts of the world, I wish you all a very happy and healthy 2021.
