Luxury market foreign see bigger than the French14 June
According to a study of Sotheby's International Realty, while buyers are still conscious of French tax uncertainties, foreign customers are on the lookout for high-end properties.
After the slowdown in late 2012, the market seems to be reassured after the beginning of 2013 according to Sotheby's International Realty France.
After a disappointing end of 2012, ‘’we have recorded more than 80 sales for a total of more than 100 million in the first quarter of 2013. It is a stable result considering the major political and economic concerns in recent months’’, said Alexander Kraft, president and CEO of Sotheby's International Realty France and Monaco. These are 84 high-end transactions recorded for the period between 1 January and 1 April 2013 at an average price of € 1.2 million.
If the high-end market continues to thrive, this trend should continue. For sure, it appears that the very high-end property market, between 2 million and 10 million euros, remains as attractive as ever especially for foreign investors. However, the market for properties between €500k and 2 million is still affected by the political and fiscal uncertainties surrounding the next French laws.
Same trend in Paris:
This trend is especially notable in the Paris market. "The Parisian real estate market is getting tougher, with a general decline in prices of about 10%. This decrease is mainly due to the instability of French tax laws that is making buyers wait before purchasing. Because of this caution, prices began to be traded more fiercely. "A slight decline in sales volume has been observed on the Paris market compared to the first half of 2012.
In addition, sellers now have to deal with much more sophisticated buyers, and fewer in number, forcing sellers to be in competition which then results in a real price adjustment, "the average price difference is of the order of 10 to 15% of the price of the purchase and presentation," according to the real estate group.
International buyers are interested:
As at the national level, the demand varies depending on the type of property, but this time across the capital. While the market is flat for properties between 2.5 million and 6 million this study shows that "the high-end market is doing well" since it is injected with international client investment from 6 million to 30 million and continue to be in demand from foreigners. Foreign investors who come mainly from the Middle East, Gulf, Russia or South America, especially for properties of more than €10 million.
However, the French, will remain more attracted by the relatively small Parisian property. "Below 120 m2, the pied-a-terre always attracts interest among the French. The clientele are mostly French families for properties between 120 and 300 m², "then said Paulo Fernandes, one of the managing partners of Paris Ouest Sotheby's International Realty. This type of property, between 800,000 and 2.5 million euros can then be sold in one month, if they are at the right price.
To read the original article, please click here.