The economic crisis triggered in recent months by the COVID-19 pandemic has had an impact on many sectors, including the French real estate sector.
But let’s not underestimate the resilience and stability of the French real estate market. According to the French property market report of January 2021 issued by the Notaries of France, the transaction volume in France reached “1,020,000 transactions at the end of November 2020 [for old properties], down only 4% compared to November 2019”. A moderate decline.
The public health crisis has caused major upheavals in the real estate market in France
There was only a slight drop in the number of real estate transactions in France in 2020. But other constraints have disrupted professional practices.
One example is the immobilization of French real estate agents since the first lockdown. The nationwide ban on face-to-face visits and transactions has made their job difficult. Some agents have even decided to address the President and the French government. Last November, several estate groups and networks submitted a request for exemption.
Alexandra Levy, a real estate agent in Paris, explained to France Info: “We are allowed to meet with our seller clients to accept mandates, while those renting out properties have the right to do inspections, and therefore meet with another person in the apartment. But, for real estate visits, this is not allowed [...].” Many professionals find the measures implemented in response to the pandemic confusing.
These upheavals in the French housing market have prompted real estate agencies to review their practices. Many of them decided to switch to tools that are more compatible with the rules in force. In most cases, this means digitalizing processes. From prospecting/marketing to client retention, as well as sales pitches and supporting clients throughout the process of buying a residential property... there is no shortage of tools available.
Our findings on the market trends for French real estate in recent months
The challenges in 2020 were unfortunately not limited to logistics. The volatility of property prices in France has created problems for many real estate agents. Setting and explaining the “right” selling price was already a difficult task in normal times. It has now become even more complicated than it was in previous years.
Here are our findings based on price data from real estate listings in recent months:
1. Paris: real estate prices in central Paris did not change much in 2020, but decreased in 2021
Loeiz Bourdic, Director of PriceHubble France, already reported changes in the Paris real estate market to Le Figaro in August 2020. “For the first time since 2014, our data now shows the beginnings of a decline in real estate prices, which for the time being remains confined to Paris.”
PriceHubble detected this downward trend early on in the prices of online listings. A decrease in the price of parisian properties put up for sale was then confirmed at the end of 2020 by the Chambre des Notaires de Paris.
What about 2021? The downward trend in the price of listings for Paris has maintained its course, and has even accelerated. The listings published in the first quarter of 2021 show that the median price per square meter has fallen by 1.11% compared to the previous quarter.
2. Île-de-France: price increase in 2020
The median price per square meter rose between the first quarter of 2020 and the first quarter of 2021 in the Paris region. The highest increases happened in the arrondissements of Seine-et-Marne (+7.95%), Seine-Saint-Denis (+7.94%) and Val-de-Marne (+5.44%). Several experts have attributed this rise to the increased adoption of remote working and the demand for larger, greener living spaces.
3. Aix-Marseille: a sharp rise in real estate prices in 2020
Although the median price per square meter for Marseille increased by 17.7% over the course of 2020, this year’s data does not follow the same trend. The analysis for the first quarter of 2021 shows a decline of 1.23% in the median price per square meter compared to the previous quarter.
With an increase of 11.95% in 2020, Aix-en-Provence followed a similar trend to Marseille. Yet, no decline has been recorded this year, according to the data for January and February 2021. The median price per square meter has even increased by 1.48% since the last quarter.
4. Lyon-Villeurbanne: the price evolution is maintaining its course
The data on the real estate market in France between January and July 2020 shows a clear change in Lyon - an increase of over 12% of the median price per square meter.
The suburbs of Lyon are no exception. The median price per square meter in the commune of Villeurbanne, for example, rose by more than 9% in 2020.
Prices in Lyon stabilised in January and February 2021, with an increase of 0.1% compared to the last quarter of 2020. In Villeurbanne, prices continue to rise: January and February 2021 saw an increase of more than 3% compared to the previous quarter.
What lessons can real estate agencies in France draw from the past year?
If we had to highlight a few key aspects of the French real estate market in recent months, what would they be? Alexis Radjabi, VP Sales & Business Development at PriceHubble has identified three points:
1. Remote and virtual solutions have become essential for maintaining business continuity in France
Many professionals had already taken the lead in digitalizing some of their operations in the past years. A concrete example is the growing popularity of tools for facilitating remote purchases, such as virtual tour systems. Now, the transition to these new technologies has now become indispensable.
2. Digitalization as a strategic element for French real estate agencies
Beyond the possibility to virtualize activities, digitalization can help simplify and automate tasks. It can be very helpful for the acquisition of mandates, for example. It is crucial to convince potential sellers to sign a mandate, even when working remotely.
How? By working on several levels:
- Attract new prospective sellers through a successful marketing strategy. One way to do so is by offering free online estimation solutions.
- Win over these new prospects by advising them on the latest market dynamics.
- Engage your client base by offering successful market analyses - this could help them start a new sales project with you.
3. Stand out thanks to transparency and knowledge of the French real estate market
How to build a solid and fair case in these times of uncertainty and price volatility? How to explain to a prospective seller that the appropriate price may vary greatly from one quarter to the next? The answer is simple: by using the most accurate and up-to-date data on the French real estate market. Using a tool such as Property Advisor can help you emphasize your expertise and create a trusting relationship with prospective clients.
Contact us to learn more about how you can stand out as a real estate agency using digital data-driven tools.