The French real estate market is unlikely to emerge totally unscathed from recent events in Great Britain. While the pound sterling lost 9% a week after the vote in favor of Brexit on June 23, a further fall in the British currency is likely to weigh on the purchasing power of households wishing to invest in French property.
This is what MeilleursAgents indicated in its latest property price barometer, recalling that the British are the leading foreign investors in France ahead of the Italians. In total, there are 200,000 of them living in France, a figure to which must be added the 200,000 second homes they own, according to the press.
According to the real estate estimation website, a fall in the pound would impact British demand, particularly in the ski resorts of the Alps, in the central districts of Paris, on the French Riviera and in Brittany. Some departments in the southwest of France, such as the Dordogne, which already has 6,000 British residents, are also likely to suffer.
Because the English are serious customers. They spend an average of 700,000 euros to buy a property, according to a BNP Paribas study, 'hence the impact will be concentrated on high-end real estate'.
The interest rates in reinforcement
But not everything is so black. Because if the Brexit were to involve a durable volatility of the financial markets, the real estate could benefit -like other assets considered as safe havens- of an influx of investors eager to put their patrimony in the shelter, in countries economically more stable as France, indicates the specialist.
Since the results of the vote, the world's stock markets have fallen sharply, but the much-feared collapse has not occurred. For its part, the pound has stabilized. As for interest rates, they have recently reached unprecedented levels, but further declines cannot be ruled out.
For the French real estate market, this new drop in interest rates will again inflate the purchasing power of buyers and maintain - quite artificially - prices in the coming months," continues MeilleursAgents.
In June, prices of older homes continued to rise in Paris and in most major French cities. In the capital, they have increased on average by 0.5% in one month. In the provinces, with the notable exception of Marseille (-0.4%), the trend is upward, with +0.6% in Lyon and +0.4% in Bordeaux, Nice and Toulouse, concludes the real estate site.
Source : La Vie Immo (website)
