Guide to buying property in Paris
Buying Property in Paris
Whether you are looking for a well-located pied-à-terre with Eiffel Tower views for city escapes or a family property near the best schools for relocation, owning a property in Paris allows you to immerse yourself in the capital’s signature art de vivre. In addition, buying a property in Paris also represents an exciting investment opportunity with prices steadily growing and the potential to monetise your investment via rentals.
Why invest in Paris property?
Thriving property market
Ranked the third-best city in Europe for real estate prospects for 2021 by PwC, Paris has an active real estate market with properties here increasing in value and a plethora of exciting infrastructure improvements on the horizon. Despite the challenges of 2020, €13bn of real estate transactions were made between Q4 2019 and Q3 2020, making the Parisian property market the second-most active in Europe. During the course of 2020, the average price per sqm in the French capital rose by 5.7%, bringing the median value up to €10,683 per sqm.
Quality of Life
The love affair between Paris and international investors continues to attract an international clientele who come to soak up the unique culture, sample delicious food and wine and bask
in the quintessential Parisian lifestyle. Home to some of the best museums and galleries, exquisite restaurants and the birthplace of the famous coffee shop culture, the French capital continues to live up to its reputation for both residents and visitors alike.
The Grand Paris project and the 2024 Olympic Games
Some €35 billion is being invested in what is dubbed the largest transport project in Europe, a level of development not experienced in the city since Baron Haussmann’s urban renewal programme in the 1860s. It is transforming Paris into a genuine 21st-century global metropolis by better connecting the city centre to the suburbs by adding 200km of new railway lines. Overall, Grand Paris will not only stimulate businesses and the real estate market in the centre, but it will also make it easier for business visitors and tourists to navigate the city and region’s various business districts.
Paris has been chosen to host the 2024 edition of the Olympic and Paralympic Games which will have a positive effect on the economy and the central property market. According to the CDES, hosting the Games could generate €10.7bn in economic benefits whilst creating a further 250,000 jobs in the Île-de-France region.
A major economic hub
Paris is home to the largest purpose-built business district in Europe and the fourth most attractive international business destination in the world: La Défense. Spanning 1.6 square kilometres and comprising 3.5 million square metres of office space, many major international brands have set up an office here, including 15 Fortune Global 500 companies.
With 180,000 employees based at La Défense and many UK companies seeking to move some of their activities out of the UK now that Brexit has been actioned, this business district is set to become even more attractive over the coming years and this will increase the demand for both rentals and properties for sale in Paris.
The key things to consider when buying a property in Paris
Location, location, location
First and foremost, when buying a property in Paris, you will need to think about where the property is located. Paris is divided into 20 arrondissements or districts and the ambience and prices can vary considerably from one neighbourhood to the next. Plus, you will need to think about how close the property is to what matters most to you. For example, if you are looking to relocate with your family to Paris, you may want to see where the best international schools and green spaces are
If you are not sure where to begin, do get in touch with our Paris-based Destination Adviser, Lucile Savattier is on hand to help you find the perfect location for your needs.
New-build or resale
New-build properties are in high demand, especially with international investors, due to the fact that they are easier to maintain. Whilst London sees 24,000 or so new-build properties added to the market each year, new-build opportunities are harder to come by in Paris with only 600 or so added each year. New-build properties are often more expensive than resales but they do have the added benefit of no renovation works and a lower notary fee of 2-2.5%.
Paris has a very healthy resale market which is perfect for those seeking quintessential Parisian apartments in a Haussmannian building. Combining the best of both aesthetics, resale apartments often feature a mix of contemporary interior design and preserved traditional architectural details such as moulded ceilings. Though resale apartments are often cheaper initially than new-build properties, it is worth noting that the notary fee is considerably higher at 7-8% and it is important that you evaluate the condition of the property beforehand as it may need some renovation work.
As with buying a property anywhere in the world, when browsing properties for sale in Paris, it is helpful to draw up a list of the essential requirements and those which are just nice to have. This can help you filter down your search and help our Destination Advisers find a property which best suits your needs. Some of the things to think about include proximity to amenities, the ambience of the neighbourhood, the style of the building, exterior space, parking and, of course, views.
Where to buy a property in Paris
The City of Lights is broken up into 20 arrondissements many of these can be further divided into districts, each with a different personality and appeal. Take a look below at some of our most popular arrondissements in Paris.
One of the oldest districts in Paris, the 4th arrondissement is the medieval heart of the capital and home to the iconic Hôtel de Ville. This neighbourhood is broken down into three official districts: Saint-Merri, Saint-Gervais and Notre-Dame. Though it is not technically a district, it is here that one can find the lively Marais district which has become one of the most sought-after areas in Paris 4 and is home to trendy bars, restaurants and shops.
One of the most affluent arrondissements in Paris, Paris 8 is home to Les Champs-Élysées, one of the world’s most famous shopping streets, as well as several notable landmarks, including Le Grand Palais, and a dizzying array of Michelin star restaurants. This neighbourhood comprises a mix of beautiful Haussmannian buildings and period buildings which exude 1930’s charm. A sought-after and prestigious arrondissement, property prices here are some of the highest in the city and Avenue Montaigne, the neighbourhood’s most coveted address, is one of the most expensive residential areas in the world.
Bordering the 14th, 6th and 7th arrondissements in south-west Paris, this lively neighbourhood is a favourite with young families, not least due to its plethora of excellent schools, and it boasts easy access to the city centre and the Périphérique. A very green neighbourhood, here you will find the André Citroën and Georges Brassens parks. The largest of Paris’s arrondissements, there is a very diverse property market with a mix of contemporary and period properties. Prices here vary considerably and those closer to the centre and sites of interest, like embassies, tend to command the highest prices.
One of the largest and safest neighbourhoods in Paris, this prestigious arrondissement is characterised by beautiful streets lined with flowers, charming cafes and boutiques. This neighbourhood is also home to Palais de Tokyo and the museum of contemporary art. Paris 16 also has a thriving expat community and is especially popular with young families. Properties in this neighbourhood tend to be larger than those in other arrondissements and Avenue Foch, Auteuil and Passy are some of the most sought-after areas for properties here.
Away from the major tourist attractions, Paris 17 is the place to be for those who want to live in Paris like a local. Home to great cafes and brimming with beautiful Haussmannian architecture, Paris 17 has a real village atmosphere whilst conveying a true sense of la vie Parisienne. Whilst offering more competitive prices than the neighbouring 8th, 9th and 16th arrondissements, this district is ideal for those looking for a quiet place to live yet with easy access to key destinations.
How to buy a property in Paris
France has long been a destination for overseas real estate investors, largely due to its highly regulated and secure property market which protects buyers at each and every step.
For existing properties (resale), the acquisition costs, known as ‘Frais de Notaire’ or ‘Notary Fees’, are normally around 7-8% of the purchase price. However, if you choose to buy off-plan (new-build), the Notary Fees much lower at 2-2.5% and the cost of the property is paid in instalments according to a schedule called an “appel de fonds”.
- The seller accepts the buyer’s offer
- A notary is selected and they compile the documents needed to draft the deeds and perform the necessary verifications.
- The preliminary contract is signed and the buyer arranges the payment of the deposit
- The buyer has a 10-day cooling-off period
- The buyer arranges the full purchase funds (mortgage or cash) and the final deed is drawn up
- The buyer transfers the funds to the escrow account of the notary
- The final deed is signed
- The buyer then collects the keys
Financing Your Paris Property
Between 60-80% of the cost of the property can be financed depending on nationality or country of residence. At the moment, long-term fixed mortgage rates in France are very low. Getting a French mortgage is quite simple, even though the amount of documentation required for the application can discourage some property buyers. French Private Finance, Athena Advisers’ sister company, is an expert in obtaining French property finance for international buyers. With their team of experts, the very best French financial strategies are combined with the regulations that apply in the investor’s country of residence, in order to provide a specialised and professional service.
Renting out your property in Paris
As well as a wonderful home away from home, owning a property in Paris also gives you the opportunity to diversify your income through rentals. 62% of those who live in the City of Lights are tenants so there is a strong rental demand in the city. Long-term rentals are the easiest and most common type; rents are pre-set by the local authorities so check out the Paris Prefecture website to work out how much rental income you can generate.
However, you may charge more for your property if it offers something exceptional for the area. This could be high-quality equipment in the kitchen, exterior space or even views over the river or a famous monument. Thanks to the mobility lease, it is also possible to rent out your property on a medium-term basis (between 1 and 10 months) to the likes of interns, students, apprentices and those undergoing training in the city.
Finally, short-term rentals are heavily restricted in the capital but are not impossible. Properties with what is known as ‘commercialité’ may be rented out on a short-term basis and can generate yields of more than 6%. If this is something of interest, please do get in touch and we can help you find properties with commercialité.
For more information on rentals, please see our ‘Complete Guide to Renting Out Property in Paris’.
FRENCH PRIVATE FINANCE
Athena Private Finance and its French-focused company French Private Finance make accessing mortgages, development finance and other financial services easy for our international clients. Their skills and experience enable investors in Paris to move quickly along the purchase process, increasing the investor’s chances of being able to secure their chosen investment.