While the health crisis has temporarily disrupted real estate operations, the deconfinement marks the recovery for buyers and sellers of all the projects temporarily left on the sidelines.
If the year 2020 looked very promising for prestige real estate: “2020 was becoming the biggest record year for more than 20 years,” said Alexander Kraft, CEO of Sotheby’s International Realty France-Monaco, the containment has put a brake on its rise.
The network specialising in luxury real estate had recorded a 9% increase in the average amount of properties sold in 2019 to reach 1.72 million euros. However, according to Alexander Kraft, this trend is set to change: “We believe that prices will stagnate or even fall”. Indeed, the economic crisis is redistributing the cards and its effects are not sparing any buyer.
Luxury a safe haven in times of crisis
However, this period of latency was also an opportunity to reinforce the image of the stone as a valuable refuge. It is this value which, much more than for standard properties, protects high-end properties from the post-crisis price drop.
“During these first days of the deconfinement, we have noted strong activity on the part of both buyers and sellers”.
Circumstances have also highlighted the importance of the comfort and functionality of a principal residence, therefore accentuating the appeal of luxury real estate and overturn certain prevarications.
Market recovery in full swing
Market players have also seen, particularly in the Paris region, various real estate purchases paid for in cash and without conditions. Alexander Kraft relates the sale of a house located in a western Parisian city presented at 3 million euros, for which a visit was organized on May 11th which resulted in an offer at the price.
The multiplication of such examples is also justified by the profile of buyers of this type of property. Indeed, their solid guarantees in terms of solvency are an asset for lending institutions. They should therefore be less subject to the rise in mortgage lending.
Featured photo : © Unsplash / Yun Xu
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