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French Property Market – December 2015

Posted by Chez de Chez on December 14, 2015
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Are we seeing, albeit very tiny, the green shoots of recovery in the French property market?

Well the signs are far more positive than they have been for a few years.  With a significant improvement in the number of transactions, coupled with the anticipated huge price drops, which had been expected from many buyers, just not happening.

There is still a long way to go, with little chance of real price rises for this coming year and enough legislation to keep nervous buyers at bay but the French property market certainly appears in better shape than it did 12 months ago.

When did the changes start to happen and why?

As with most years, the property trends governing 2015 started in the spring.  What appears to have kick started a mini surge in purchases around this time was a slight rise in interest rates.  This probably focused buyers’ minds that maybe time was no longer on their side and there was a flurry of activity.

This sudden increase in transactions also meant that the market was left with less of certain types of properties available, which in turn meant property price rises in some areas, where demand began to outstrip supply.  In fact we were surprised to see houses come on the market and sell in under 3 months.  These houses I hasten to add, were sensibly priced and ticked a lot of boxes for the average buyer but it was still a good sign that things were picking up.

Predictions for the 2016 French property market

In this time of slow and delicate recovery, so much rests on interest rates.

If interest rates increase, even by a tiny percentage they could convince the type of property owner who wants or needs to trade up to finally consider moving home.  These buyers have been in decline over the past few years, preferring to continue to live in a home that’s no longer appropriate for their needs, rather than taking the risk of moving.  They’re the most important buyers in property chains, as they’re both buyers and sellers and are needed to keep property supply and demand fluid.

The past 6 months has certainly seen more transactions from these owners and if this trend continues we may even see a shortage of some types of properties, which may in turn cause slight property price increases in certain areas, as demand once again outstrips supply.

However, if interest rates fall or remain stable (which is the most likely scenario), there is once again no pressure or incentive on buyers to move quickly.  This means that the market will most likely remain pretty much as it has been through 2015, with maybe continued small price reductions in areas where there’s no other factors driving transactions, especially in areas where there’s little or no overseas buyers

Emerging trends

Trends observed nationally from leading indicators as a projection to November 2015 anticipates a market recovery with the estimate that older apartments should rise by 1.1% and older houses should stabilise.

New Builds

The number of new homes reserved by buyers in the second quarter of 2015 was 26,500 which is a 21.8% increase on the same period last year.  However, the market has seen a 3.9% drop in the number of new builds going on the market in the second quarter of 2015.

The average sale price per square metre is up in over half of France’s 22 regions, with six regions remaining the same and just three dropping in price.  The average price rise over the year is 1.1% and if the trend for less new build housing stock continues, this may well drive new build prices up further.

Exchange rates

Whilst the signs for a recover are certainly there, it’s a fine balance and yes there’s most likely to be some small reductions in prices to come yet.  However, these percentage reductions are becoming far smaller and the general belief is that they’re almost certainly coming to an end.

What could have a far greater impact on your investment is the sterling/Euro exchange rate.

Sterling has been strong against the Euro for a long time now and we may have become a little complacent that this will continue.  However, we’ve seen a few spikes of late that’s reminded us just how quickly things can change.  This year sterling has been pretty much consistently high against the Euro, with the peak of 1.44 on the 17th July but then as recently as the 13th October it was down to 1.33.

In real terms this would have meant that you’d have seen a £200,000 investment pot go from being worth 288,000 Euros to 266,000 Euros. a 22,000,7.6% reduction, making a 1.5%-2% fall in house prices a mere drop in the ocean by comparison.

In summary

Our advice is as always, take your time to find the house of your dreams but once you do so, buy it, don’t try to play the market.  House purchases should always be seen as a lifestyle choice and long term investment.  Holding out for a bargain could result in you never being able to realise your dream, or that your investment pot is suddenly worth far less than it was just a few months ago.

Buying your Languedoc home – Where to start

If you’ve decided that now is the time to start planning your Languedoc property purchase, here are a few specialist companies we particularly like for their excellent service levels, that you might find useful to know. These are either companies we have or currently use, or who have come highly recommended to us.

French Currency exchange

We’ve tried many FX companies over the years but our favourite by a long shot is TorFx.  We and all our clients are guaranteed one specialist advisor as a point of contact. No random call centre person and no jargon, just straightforward, honest advice, exemplary service levels and bank beating exchange rates.

Contact our lovely account manager: Hazel Tompkins, (who incidentally has also worked in the Languedoc) with any questions you might have.

Tel: +44 (0)1736 335243 | Email: | Web:

French Insurance

We found that over the years that the support we received from Asttral almost certainly saved us money and Nick Chubb is one of the first people we’d call in a crisis!

If you’d like some advice about what sort of insurance you might require, or would like a quotation, please give their friendly, English speaking team a call.

Tel: +33 (0)4 68 32 41 20



French Mortgages

If you’re at all worried about being able to secure a French mortgage, please don’t despair. We’ve found a fabulous broker French Mortgage Direct, who can often secure a mortgage for clients, where banks have previously given a resounding “NON”!

French Mortgage Direct is an independent registered mortgage broker, based in France, with over 10 years experience arranging mortgages for international clients worldwide.

CALL: (from UK) 0800 530 0673
(from elsewhere): 0033 (0) 4 37 06 53 82

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