With house prices stabilised and a record number of old properties sold in 2015, the French property market is offering plenty of investment opportunities in 2016.
After a successful 2015 with sales continuing to increase throughout the year, January 2016 was the best January that Home Hunts has had since starting the business in 2004. “Both sales and enquiries are currently at an all-time high, so it looks like we are set for a very positive year,” says Tim Swannie, Director of Home Hunts.
During the course of 2015 property prices stabilised across France and, as predicted by Home Hunts, turned into the “year of the deal”. A combination of flexible property prices, low interest rates and favourable currency pairings meant that buyers could negotiate deals with vendors that may not previously have been possible. This bargaining tactic helped to boost the number of overall sales made throughout the year.
A record-breaking year for older houses
Indeed, the FNAIM (national association of French estate agents) announced that the market for older properties in France had seen a phenomenal recovery that echoed the year 2000 with a record-breaking 800,000 sold during 2015.
“We managed to secure some amazing properties for clients last year at some great prices and we expect this trend to continue throughout 2016” says Tim. “Instead of waiting to make a purchase, buyers are pushing as hard as they can to get the deal they want and market sales are proof that this strategy has propelled the market into a buoyant position.”
House prices stable and expected to rise
Generally, property prices levelled out across the country aided by the continuing economic recovery in Europe that inspired confidence to buy. Overall, according to Notaires de France, older property prices fell by 1.7% in 2015, but the rate of the fall was easing by the end of the year and sales agreements from the start of 2016 show a slight rise in prices. Areas experiencing increases include Toulouse (1.5%) and Bordeaux (2%), both in the Midi-Pyrénées region.
“Prices definitely started to level out last year, but you can still make an offer in most areas,” says Tim. “The Riviera, Paris, parts of Provence and much of the Alps are due to see a slight rise in prices this year, but most other areas should remain pretty stable.”
Large resurgence of British buyers in France
Home Hunts works mainly with overseas buyers and found that during 2015 there was a large resurgence of British buyers, mainly fuelled by exchange rates, lower prices and low interest rates. There were also many enquiries and sales from Dutch, Belgian, German, Scandinavian, Swiss and Middle Eastern clients, but Home Hunts is aware that the UK’s EU referendum could have an effect on the increasing number of British buyers investing in French property.
“While the market continues to improve, June’s EU referendum will certainly unsettle certain British clients,” says Tim. “However, so far, it does not seem to have affected their appetite for French property. The pound has lost a little strength compared to last year, but it is still comparatively high if you look at it over the past five-to-six years, so British buyers can really make the most of their budgets at the moment.”
Excellent deals and investment prospects
In general, the conditions for buying in France are still excellent for buyers. As Notaires de France confirms in its property market report, supply is still plentiful, interest rates are still low and exchange rates remain advantageous. “The banks are still offering some amazing mortgage rates and there are some great property deals to be had,” adds Tim.
There are also some areas in France that are offering particularly exceptional investment opportunities, some due to improved infrastructure. For example, with the LGV (Ligne à Grande Vitesse) due to connect Bordeaux with Paris in two hours in 2017, property within half-an-hour from Bordeaux will substantially increase in value over the next 12 months. Similarly, now the TGV runs from London to Marseille areas of Provence have opened up and locations around Avignon and Saint Remy de Provence are becoming extremely popular. “Grasse is also a great area for investment as millions are being spent redeveloping the centre and now there is a train line directly to Cannes,” says Tim.
Other recommended areas for property investment in 2016 include: Beziers in Languedoc-Roussillon, little villages such as Bormes-les-Mimosas and Carqueiranne on the Provence coast, and Samoëns, which, believes Home Hunts, offers the best value for money in the Alps.
“We are getting a huge amount of interest at present in most areas, but these locations are offering particularly lucrative investment possibilities for our buyers,” says Tim. “For 2016 we will continue to do what we do best and help our international buyers to find the best deals on the French property market.”
To search for luxury property in France, visit www.home-hunts.com, but to speak to a consultant personally about your property criteria, call +33 (0)970 44 66 43.