Nothing seems to affect the prestigious real estate market. After an exceptional year in 2017, luxury real estate once again achieved record sales last year.
Last year, the luxury real estate market was driven by the return of non-residents as well as the return of the managers of major French groups with sales up in the apartment and house segment to over €3 million. Brexit also provides a steady but moderate flow of families wishing to acquire a property in Paris, according to Coldwell Banker.
“The market outperformed in 2018 with sales volumes up 34.45% to €754 million. Real estate has fully played its role as a safe haven. And while the year started slowly, all concerns were quickly lifted,” said Laurent Demeure, President of Coldwell Banker France and Monaco. Within its network, which has just under thirty locations in France, the average property put up for sale was €1.279 million, up 8.86% compared to 2017.
In France, Paris benefits from a 12% increase in sales in excess of €1 million and a 17.69% increase in sales of goods over €15,000 per square metre. This increase in sales is expected to continue in 2019.
For 2019, Coldwell Banker expects another dynamic year in which the 10,000 euros/m² threshold should be reached in Paris in the first quarter of the year. Prices are expected to continue to rise slightly until 2020.
The Coldwell Banker network also notes that acquirers want to be better informed and really want to know where they are going to invest their money. “Buyers ask relevant, sometimes technical questions and often require a complete history of the life of the property they wish to acquire and even its potential profitability. Buyers are in a dynamic business even for the purchase of their main residence! “, says Laurent Demeure.
It remains to be seen whether these forecasts can be maintained at a time when the image of the capital has been seriously damaged by repeated violent demonstrations. But according to Laurent Demeure, it is above all the tourist and hotel sector that is likely to be much harder hit than real estate by these troubles. Investors, French or foreign, would be “accustomed to the French social climate” and there would therefore be no price decrease to expect.
In the rest of the world
At the global level, in a period of calm and price convergence, only three European capitals still stand out in this global ranking with significant increases expected in the coming year. Berlin and Madrid are now alongside Paris with an expected jump of 6%.
Outside this European top three, only Miami emerges with a 5% increase. A global moderation in most international markets that Knight Frank explains by the multiplication of new regulations on the real estate market, the rise in financing costs, the uncertainties related to Brexit and, in some cities, the launch of a significant volume of new high-end housing.
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