Trends in the development of real estate market in France

Housing prices continue to fall in France, but in different ways in different regions of the country. Over the last month there were many reports on the state of French real estate held by the agencies, notaries and economists. From these data, one can conclude that in some areas prices are rising and sales become larger.

Prices

Large agencies, such as Century 21, Laforêt and Orpi note a slight decrease in average prices in the first half of 2013 and decrease by 2.5% and 3.6% compared to the same period last year. Notary's office also noted that in the regions second homes grew by 0.5% in the first quarter of 2013 compared to the end of 2012. It is also noted that in the year prices declined by 1.8%, reports french-property.com.

From the point of view of geography, we see a large spread and multi-directional prices in different regions of the country. For the year in all regions of the country, with the exception of Upper Normandy, prices declined. The largest decline occurred in Lower Normandy (-7,7%), Franche-Comté (-7,6%), Picardie (-7,3%), Provence Cote-d'Azur (-5,9%), Languedoc-Roussillon (-5,7%) and Brittany (-5,2%).

Also, there is a decrease in prices in the regions of Pays-de-la-Loire (-6,5%), Champagne-Ardenne (-6,3%), and the Centre (-5,1%). And among the regions in which prices rose, turned Poitou-Charentes, Limousin, Aquitaine, Lorraine, Alsace and Burgundy.

Reports show a decline in prices in about half of departments. The largest drop observed in the departments of Var (-9,1%), Charente Maritime (-7%), Vaucluse (-6,5%) and Morbihan (-5,9 %). In all these departments exists very extensive secondary housing market.

The prices rose in the departments of Hérault (+8,5%), Haute-Garonne (+6%), Bouches-du-Rhône (+3,1%) and Rhône (+2,2%). Each of these departments has a strong economic center.

Sales

In spite of the unanimous opinion that the level of sales will decline in 2013 compared to 2012 (figures which in turn were lower than 2011), reports suggest that sales have grown in many regions in the first half of 2013. Experts attribute this to the low prices and record low interest rates on mortgages (less than 3% for a loan for 20 years).

Nevertheless, the French experts believe that this is a blend. The level of demand is very unstable. There are a number of opportunists who want to play on favorable terms, but the offer is often limited because the sellers do not want to expose their objects for sale. The bulk of the objects appeared on the market because of certain circumstances - divorce, death, job changes. Small objects are less than required, and large are more than the demand for them.

Do not add optimism and the expectation of capital gains tax. Experts also believe that a considerable part of the mortgage loans are taken by people who want to take advantage of low interest rates to refinance their old loans.

Forecast

Because of the small supply and low interest rates, no one predicted the collapse of the French market. Most experts agree on the fact that the French market is based on the principle that its structure is favorable and that it will provide a slow and gradual change of scenes instead of spikes and crises.