The cost of real estate in France

When we talk about real estate in France, we allude to the French accommodation market. It must be said that the real estate supply largely depends on the population growth. In other words, the offer of accommodation is formulated in relation to supply. Thus the growing demographic force on a defined space explains the rising prices of real estate, which favours the phenomenon of “decohabitation” nowadays.

The double influence of the rise of “stone” price and the cut on interest rates encourages resorting to borrowing. Thus numerous French households will attain an average debt of 8,133 euros per person in 2005.

A slight fall of real estate prices of -2.9% was registered in the country from the third semester of 2008 (according to the FNAIM). On the contrary, Paris resisted with a price increase higher than 2.6%. It must be added that in Paris the price of accommodation remains high, with a price of 6,580 euros per square meter, which is not the case in the suburbs. These prices are rocketing, since the Parisian capital remains very much coveted. In 2007, there was an interest rate of over 10%, as opposed to the suburbs, where the real estate market slowed down.

However, real estate in France is improving chiefly with a significant sale of old accommodations during 2009 unlike in 2008. About 35,000 sales have been made against 31,500 last year.

In addition, several factors can be cited which characterise the cost of real estate in France, namely the location and the quality of the properties. Also, the rise of real estate and of rental prices in France makes finding accommodation particularly difficult.

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