Paris real estate market: is it a good time to buy?

Should you buy an apartment or a townhouse in Paris in 2024, or is it better to wait? In this article, we'll explore the different aspects of the Paris real estate market to answer this question: is now the right time to buy property in Paris?

The state of the Paris real estate market in 2024-2025

A changing Paris real estate market

The Paris real estate market is in a state of flux. After a decade of steady price growth, prices are now declining and stabilizing. In 2024, average prices per square meter in Paris varied considerably, depending on the neighborhood. The 6th, 7th and 9th arrondissement have weathered the crisis very well. The Marais, 5th and 16th arrondissement held up well. More difficult for the 10th, 17th, 18th, 19th and 20th arrondissements, which have seen sharper corrections of the order of 7 to 10% during 2023.

Falling transaction volumes

The number of transactions has fallen slightly since the beginning of the year. The decline in sales volumes continues, and the market remains characterized by low activity, with no sign of recovery. Although the decline is becoming slightly less pronounced with each passing month, the statistics do not yet point to a rebound. What's more, these new declines come at a time when the market already experienced a sharp contraction last year.

This trend reflects buyers' increased caution in the face of an uncertain economic and political context.

Paris real estate market adjusts

Overall, the Paris real estate market is going through a period of adjustment, with supply tending to slightly exceed demand, creating opportunities for buyers able to negotiate. While this situation may seem favorable to those looking to buy, it requires careful analysis of the specific trends and dynamics of each neighborhood in order to make the best possible decision.

The advantages of buying right now in Paris

Buying real estate in Paris in 2024 offers a number of advantages, particularly in the context of a changing market. First of all, stabilizing or even falling prices in certain neighborhoods offer real opportunities for buyers.

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Traditionally popular areas, such as central and southern Paris, are seeing prices stagnate, while others on the outskirts are seeing falls of up to 7-9%. This situation is enabling many buyers to benefit from better value for money.

This market dynamic also creates a favorable context for negotiation. Sellers, aware of the decreasing number of potential buyers and longer sales times, are often more inclined to lower their prices or accept more flexible purchase conditions. Buyers therefore have more leeway to negotiate not only the price, but also the conditions of sale or the timeframe.

Buying real estate in Paris remains a solid long-term investment. Despite recent fluctuations, the French capital remains one of the most sought-after real estate markets in the world, underpinned by constant demand, both local and international.

Paris' attractiveness as a leading economic, cultural and tourist center continues to guarantee long-term property appreciation. Investing now, when the market is experiencing a downturn, can lead to attractive capital gains in the years to come, once the economy stabilizes and demand picks up again.

In short, for those with the financial capacity and a medium- to long-term vision, now is a good time to buy in Paris, whether for housing or investment.

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Potential risks and drawbacks

Buying in Paris also presents certain risks and disadvantages that should not be overlooked. We tell you everything you need to know to avoid the pitfalls when buying an apartment in Paris. First of all, price fluctuation remains a major concern. In the current climate of economic uncertainty, there is a real risk that property values will fall in the short term.

The recent price correction in Paris suggests that the market may yet undergo further adjustments; particularly if interest rates rise or the economic and political context deteriorates. Buyers taking the plunge today could see the value of their property fall before it stabilizes or rises again. This is a greater risk for those planning to resell in the short term.

Secondly, the overall cost of buying a property in Paris remains high, even in times of slowdown. In addition to the purchase price of the property, buyers are faced with a series of ancillary costs, which can account for a significant proportion of the total investment. Notary fees, for example, amount to around 7-8% of the purchase price for an older property, to which must be added local taxes, agency fees and any renovation or energy improvement costs. These charges can add considerably to the budget, and need to be carefully factored into the purchase price calculation.

What's more, the cost of work has recently risen, due to inflation and shortages of certain materials, making renovation projects more expensive than expected.

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Competition on the Paris real estate market represents another challenge for buyers. Despite a slowdown in transactions, the market remains tight, particularly for quality properties in the most sought-after districts. Finding an attractive property that meets the criteria of location, surface area and price can be difficult, and often requires patience and responsiveness.

The most sought-after properties, such as apartments with exteriors, unobstructed views or well-located family homes, continue to sell rapidly, sometimes even above market prices, despite the current economic climate. This heightened competition can force buyers to make quick decisions, often with less room for negotiation.

In short, buying real estate in Paris involves risks, particularly in the short term, with possible price fluctuations, high acquisition costs and continued strong competition for attractive properties. Careful evaluation and sound financial preparation are essential to minimize these risks and optimize your investment. Follow the 10 steps to buying real estate.

Good to know: since 2023, the level of negotiations obtained by buyers has increased. Take your time to assess the extent to which you can obtain a price reduction. Negotiations of more than 5% of the listed price are common. However, apartments with many qualities (brightness, quietness, view, sought-after neighborhood, etc.) can sell very quickly and at high prices.

The advantages of buying your primary residence in Paris

Analyze your personal situation

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This is the place to start. Discuss it with your banker or mortgage broker. Take into account your professional stability, your long-term plans and your financial capacity. Make sure that buying an apartment is in line with your personal goals, lifestyle and future plans.

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Future prospects

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The Paris real estate market represents a good long-term investment. Although prices may fluctuate in the short term, the value of Parisian real estate tends to increase over the long term. As a homeowner, you'll benefit from the stability and security of owning a primary residence.

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The benefits of buying your own home

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One of the main advantages of buying a primary residence in Paris is the opportunity to build up long-term savings. Unlike renting, where monthly payments are spent without any return on investment, buying an apartment on the Paris real estate market allows you to build up an asset that can increase in value over time. As you make your mortgage repayments, part of the capital is gradually repaid, enabling you to build up forced savings.

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What's more, if property prices in Paris rise, the value of your principal residence may also increase, contributing to the growth of your wealth.

Capital gains tax exemption for your principal residence

Capital gains tax exemption is another major advantage of buying a principal residence in Paris. If you sell your principal residence, you are exempt from capital gains tax. This tax exemption is a significant financial advantage, as it allows you to realize a significant capital gain without having to pay part of it back to the tax authorities.

It is important to note, however, that this real estate capital gains tax exemption applies specifically to the principal residence, and does not apply to real estate intended for rental or other purposes. Consequently, if you buy an apartment in Paris with the intention of renting it out, you will not be able to benefit from this tax exemption when you resell it.

A feeling of security

Buying an apartment as your primary residence offers a sense of stability and security. You're guaranteed a roof over your head, which can be emotionally reassuring.

Conclusion: Is now the right time to buy in Paris?

In 2024-2025, the Paris real estate market is at a crossroads, offering both opportunities and challenges for buyers. On the one hand, stabilizing and falling prices in certain neighborhoods, and the possibility of greater negotiation, represent favorable arguments for those considering buying. On the other hand, fluctuating prices, the overall cost of buying and persistent competition on the market can put the brakes on some purchasing decisions.

For potential buyers, the key lies in a thorough analysis of the market and reflection on their medium- and long-term objectives. Is it better to take advantage of current conditions to buy a primary residence, or to invest in promising properties in developing neighborhoods? Each buyer profile has its own strategy, but all must take into account the risks associated with the current economic uncertainty.

To maximize the chances of a successful investment, it's essential to follow a few practical tips: consult a real estate advisor to get a clear view of the market, start by consulting your banker or a mortgage broker before embarking on the search, and don't hesitate to negotiate prices.

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Read more :

• Haussmann apartment: a unique property
• Which are the best arrondissements in Paris in 2024?
• What is the most expensive district in Paris?
• What is the difference between a compromise and a promise to sell?

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