Property prices in France will drop significantly in 2024, continuing a trend in 2023 in which the market was described as ‘in a downturn’ with buyers negotiatIng hard, predict several industry experts.
Estate agent website Meilleurs Agents said its calculation trends showed prices had already begun to fall by 1.8% in 2023, with this trend predicted to continue.
It said that it is expecting a fall of up to 4% this year nationwide, “which is a drop twice as significant as that seen in 2023”, it said.
Brice Cardi, chairman of the estate agent network l’Adresse Immobilier, which has 330 agencies throughout the country, said: “In the first half of 2024, the fall could be as much as 5% because sellers are now aware of the need to adjust their prices.”
He said that around 75% of his network members appear to agree with him and predict that prices will fall this year. The other 25% say that prices will stagnate.
‘The only lever’ to restart the market
Some estate agents are a little more cautious. For example, the Guy Hoquet network has said it believes that prices will fall but at a much more measured pace.
It stated that “we expect property prices to continue to fall but probably at a slower pace” of around 1% over the coming year.
The Orpi network has simply warned of more price drops without specifying a number. Similarly, the president of the Century 21 group, Charles Marinakis, did not make a prediction.
However, he told Capital that price reductions would be “the last and only lever that could allow the property market to restart”.
The largest estate agency group in France has already said this month that “prices have to go down more than they did in 2023 to counter the excessive rises of recent years”.
Dropping purchasing power
The property market downturn has been blamed mainly on people’s dropping purchasing power and reduced borrowing capacity as a result of two years of interest rate increases.
This lack of available credit meant that the number of transactions signed by notaires in 2023 dropped by more than 20%. Estate agents have said this trend will only be reversed by a massive drop in prices to ‘kick-start the dynamism of the market’, reported Capital.
Current Housing Minister Patrice Vergriete spoke at the annual property conference, for la Fédération nationale de l’immobilier (Fnaim) in December: “I am clearly saying: property prices must fall because current prices no longer correspond with households’ purchasing power.”