French property - Notaires de France

French property
market report
N° 13 - OCTOBER 2011
INSEE NOTARIES INDEX
(INSEElabeled)
Old apartments
Index value
Old houses
Variation*
Index value
Variation*
2011
T1
2011
T2
3
months
1 year
2011
T1
2011
T2
Metropolitan
France
231.0
236,4
2,3 %
10,3 %
194,4
195,8
0,7 %
5,3 %
Île-de-France
246.2
254.8
3.5 %
17.3 %
188.2
190.3
1.1 %
6.5 %
Provinces
217.1
219.5
1.1 %
3.8 %
196.6
197.7
0.6 %
4.9 %
3
1 year
months
* 3-month variation: development between 2011T1 and 2011T2 * year-on-year change: development
Analysis
■ The resale market Volumes
At the end of June 2011, the volume of
sales of existing properties in France numbered 812,000 in one year. This level of
growth is admittedly slower (+16% in June
2011 compared with +32% in December
2010), but it is nevertheless contributing
to a return to the transaction levels seen
during the “best years” (2003-2007).
In Ile-de-France, the trend is one of stabilisation (+1% in May-July on the same period
of 2010). The provinces, meanwhile, show
a significant rise (+8%) in the number of
properties changing hands in the second
quarter of 2011 compared with the second
quarter of 2010.
Price
The increase in year-on-year prices remains generally strong in the second quarter of 2011 (7.8%), in spite of a slowdown.
This is due to the price of apartments having risen by 10.3% in one year and that of
houses by 5.3%. This trend is confirmed in
recent months since, between the first and
the second quarter, a rise of 2.1% can be
observed in the price of apartments and of
0.1% in the price of houses.
Paris is displaying a price development
quite distinct from the rest of the country.
The annual rise in apartment prices in the
capital has thus reached 22.5% in Paris proper and 15.1% in its closest suburbs. In the
provinces, however, the annual rise in prices
is both more moderate and less contrasting
between apartments and houses. Indeed,
house prices actually rose by more than
apartment prices (4.9% compared to 3.8%).
This trend is confirmed by the figures recorded in the Rhône-Alpes and PACA regions, where the price gap between houses
and apartments reached or exceeded two
percentage points.
In the second quarter, price stability prevailed in the provinces, for both houses
and apartments.
The provincial market appears to be driven
by a certain number of large conurbations
such as Lille and Nantes, where prices are
rising by around 10% each year, with little
difference between houses and apartments. In Toulouse, contrastingly, the rate
of increase is much greater for houses.
Apartment prices are falling in 17 departments
(Allier/Hautes-Alpes/Calvados/Cantal/Charente-Maritime/Gard/Loir-et-Cher/Loire/
Lot-et-Garonne/Manche/Oise/Pas-de-Calais/Somme/Tarn-et-Garonne/Var/Vosges/
Territoire de Belfort) and those of houses
in 16 departments (Aisne/Alpes-de-HauteProvence/Cantal/Charente/Creuse/Drôme/
Indre/Haute-Marne/Meurthe-et-Moselle/
Orne/Hautes-Pyrénées/Pyrénées-Orientales/Haut-Rhin/Deux-Sèvres/Somme/
Vaucluse). Apartment prices have dropped
for two consecutive quarters in 6 departments: Allier, Calvados, Charente- Maritime, Somme, Var and Vosges.
House prices have been displaying a
downward trend for two consecutive
months in 3 departments: Meurthe-etMoselle, Pyrénées- Orientales and DeuxSèvres.
Apartment prices, in contrast, show a rise
of over 10% in 8 departments: Alpes-deHaute-Provence, Corse-du-Sud, HauteCorse, Indre- et-Loire, Mayenne, Nord,
Orne and Haute- Vienne. Similarly, house
prices have risen by 10% in 15 departments
(Ardèche/Ardennes/Aube/Corse-du-Sud/
Haute-Corse/Dordogne/Jura/HauteLoire/Lot-et-Garonne/Morbihan/Moselle/
Nièvre/Haute-Saône/Haute-Vienne/Territoire de Belfort). The price falls are occurring especially in average-sized cities, such
as -2% in Le Havre for apartments, and
-9% in Bayonne for houses. There are few
large falls or falls affecting large cities.
This confirms the great variation between
markets, which is not simply a matter of a
contrast between Paris and the provinces.
It should be noted that the information
from preliminary contracts displays a comparable level of variation.
■ The new-build market According to the Markemetron bulletin (sales outlook indicator for individual
non-estate houses), the annual number
of transactions relating to such properties
was 5.5% down at the end of August 2011.
This trend has accelerated, since the fall
was just 2% three months earlier. It is also
more accentuated in the South and West.
As for real estate development, sales of
dwellings to private individuals have retracted by 22.6% between the second quarters of 2010 and 2011, including 21.8% in
apartment blocks. New instructions have
dropped by 8.6%. Twelve regions are experiencing a simultaneous fall in sales and
new instructions. This has led to a moderate rise (1.5%) in the number of dwellings
placed on sale (68,100) and the average
sale period has risen from 7 to 8 and a half
months. This increase in stock applies in
particular to Île-de-France and the RhôneAlpes region. The average price per m2 of
apartments sold in the second quarter of
2011 is also up 7.7%, with rises seen in Auvergne, Brittany and Île-de-France, while
the average price for individual houses has
risen by just 1.8%.
French property
market report
Notaires de France - N° 13 - October 2011
Outlook
■ The resale market
The recent change in the volume of
transactions reflects a slight slowdown
which we announced at the start of the year
for the second year half. However, the latest
fiscal measures concerning the imposition
of capital gains on property should correct
this trend. In addition, the volume of sales
for 2011 should be equivalent or even slightly
above that of 2010, which was 783,000. On the
other hand, we are expecting a significant fall
in sale numbers in 2012, which could reach
several tens of thousands of transactions,
all on a market showing increasing levels
of inter-regional contrast.
Three reasons are combining to create this
situation. First of all, there is the economic
and financial context. Growth forecasts
have been revised downwards, causing the
banks, which are already facing numerous
problems (most notably the Greek crisis),
to implement strict rules (Basle III) and to
make their credit restrictions more stringent,
in spite of interest rates remaining low.
Secondly, there’s the reform of the taxation
of capital gains on property, due to come
into force on 1 February next year, which
by doubling (to 30 years instead of 15) the
period of ownership required in order to be
exempt, will dissuade some owners of rental
accommodation, second homes or property
assets which are inherited (in two stages),
from putting them up for sale. The same will
apply to a proportion of potential investors
in these same assets. And finally, there is
the customary wait-and-see approach seen
during pre-election periods.
Another trend detected since the start of 2011
is likely to continue and affect the property
market in the coming months, namely:
- a significant fall in the number of firsttime buyers (by which we mean buyers
aged under 30).
- a rise in buyers aged over 60: 16% for the
provinces, compared with an average of 12%
in previous years.
10.3% for all pre-owned dwellings in Ile-deFrance and 16.2% for apartments in Paris,
a historically high rate, compared with an
average of 8.6% in previous years.
As for the price of resale properties, the
developments should remain positive on
the currently dynamic markets which we
have already mentioned, due to a shortage
of available stock.
■ The new-build market
The end of the year should, as is usually
the case, be more dynamic, due to a
temporary acceleration in new-build
sales ahead of December 31 linked to the
imminent end of the full-rate Scellier tax
deduction scheme, and possible future tax
adjustments. However, the volume of sales
from 2010, namely 115,000, will certainly
not be equalled, with a figure not exceeding
100,000 transactions most likely.
Average price per sq.m. of old apartments
Development over 1 year: 1 April 2010 to 30 June 2010 / 1 April 2011 to 30 June 2011
Dunkerque
1 933 €
9,4 %
Rennes
2 239 €
6,8 %
Paris
8 150 €
22,5 %
Caen
2 263 €
7,7 %
Tours
2 262 €
8,9 %
Lille
2 856 €
7,1 %
Orléans
2 046 €
5,4 %
Reims
2 025 €
3,4 %
Guadeloupe
2 120 €
ns
La Réunion
2 292 €
3,8 %
Annual change in price
per sq.m.
Less than 0 %
From 0 % to 5 %
5 % plus
ClermontFerrand
1 587 €
7,6 %
Bordeaux
2 738 €
9,5 %
Bayonne
2 667 €
12,8 %
Nîmes
1 775 €
2,0 %
Strasbourg
2 444 €
12,8 %
Besançon
1 763 €
5,0 %
Dijon
2 133 €
2,4 %
Saint-Étienne
1 263 €
1,0 %
Limoges
1 352 €
10,6 %
Nancy
1 850 €
6,9 %
Mulhouse
1 207 €
2,6 %
Nantes
2 550 €
7,7 %
Poitiers
1 515 €
-0,1 %
Metz
1 929 €
8,2 %
Lyon
3 107 €
10,6 %
Grenoble
2 422 €
4,5 %
Nice
3 679 €
8,4 %
Toulon
2 324 €
4,7 %
Toulouse
2 464 €
4,9 %
ns = not significant (the volume of sales does not permit the calculation of suitable statistics)
Source: Notaires de France property database (the prices in Île-de-France are an evaluation of
the INSEE notaries index for the 2nd quarter of 2011). Outside Île-de-France, the prices have been
calculated based on an average volume of 150 transactions per city and per quarter
Montpellier
2 527 €
5,1 %
Marseille
2 538 €
5,7 %
Haute-Corse
2 352 €
12,6 %
Corse-du-Sud
2 924 €
French property
market report
Notaires de France - N° 13 - October 2011
Average sale price of older houses
Development over 1 year: 1 April 2010 to 30 June 2010 / 1 April 2011 to 30 June 2011
Le Havre
182 200 €
4,5 %
Caen
232 700 €
Brest
188 000 €
19,0%
Tours
190 000 €
0,0 %
Lille
179 000 €
8,5 %
Amiens
156 000 €
6,1 %
Rouen
180 000 €
10,4 %
Chartres
189 500 €
-3,8 %
Metz
180 500 €
2,6 %
Île-de-France
304 700 €
6,5 %
Orléans
202 200 €
0,6 %
Nantes
240 000 €
9,1 %
Chateauroux
113 000 €
9,2 %
Poitiers
158 000 €
-1,3 %
ns
Bordeaux
246 900 €
10,2 %
Annual change
in sale prices
Less than 0 %
From 0 % to 10 %
10 % plus
Montauban
159 000 €
-0,6 %
Toulouse
265 000 €
8,4 %
ns = not significant (the volume of sales does not permit the calculation of suitable statistics)
Source: Notaires de France property database (the prices in Île-de-France are an evaluation of
the INSEE notaries index for the 2nd quarter of 2011). Outside Île-de-France, the prices have been
calculated based on an average volume of 150 transactions per city and per quarter
Nancy
170 800 €
0,5 %
Troyes
156 900 €
14,2 %
Dijon
227 000 €
2,9 %
Saint-Étienne
182 000 €
1,1 %
Lyon
296 000 €
7,6 %
Limoges
145 000 €
2,1 %
La Réunion
240 000 €
0,2%
Reims
200 000 €
-5,2 %
Grenoble
305 000 €
-0,5 %
Nîmes
194 000 €
-3,0 %
Toulon
340 000 €
6,3 %
Montpellier
303 500 €
6,1 %
Haute-Corse
220 000 €
18,9 %
Marseille /
Aix-en-Provence
318 500 €
9,8 %
Corse-du-Sud
300 000 €
20,0 %
Price per sq.m. of new property in 2nd quarter of 2011 (apartments)
Haute-Normandie
3 023 €
3,5 %
Nord-Pasde-Calais
3 094 €
-2,8 %
Picardie
3 307 €
7,8 %
ChampagneArdennes
3 088 €
5,3 %
Lorraine
2 809 €
9,0 %
Basse-Normandie
3 472 €
3,2 %
Bretagne
3 178 €
11,0 %
Alsace
3 019 €
7,8 %
Île-de-France
5 031 €
8,8 %
Pays-dela-Loire
3 456 €
7,6 %
Centre
3 043 €
0,5 %
Poitou-Charentes
3 574 €
7,4 %
ns
Franche-Comté
2 730 €
0,5 %
Limousin
2 666 €
4,5 %
Bourgogne
2 653 €
-8,2 %
Rhône-Alpes
3 728 €
8,3 %
Auvergne
3 071 €
17,4 %
Aquitaine
3 441 €
7,1 %
PACA
4 176 €
4,6 %
Price development per sq.m.
Less than 0 %
From 0 % to 5 %
5 % plus
ns = not significant (sales volumes
do not permit the calculation
of suitable statistics)
Source: FPI / ECLN / CGDD / SOeS
Midi-Pyrénées
3 389 €
8,0 %
Corse
3 269 €
2,0 %
LanguedocRoussillon
3 280 €
-0,4 %
French property
market report
Notaires de France - N° 13 - October 2011
Housing indices
France: the property price index for
France as a whole is calculated by the
Notaires de France in partnership with
the INSEE. This index is published every
three months and uses the hedonic pricing method. The data result from sale
documents transmitted by the notaries.
United States: the FHFA index produced
by the Federal Housing Finance Agency,
a US government body, measures the
development of the price of individual
houses based on a sample of mortgage
loans, using the repeated sales method.
International comparison:
property price index compared
to the income available per household
Base 2000=1
France
United States
United Kingdom
United Kingdom: the DCLG index is
the official house price index published
by the British government, based on a
sample of mortgage loans. It uses the
hedonic pricing method.
Source: CGEDD according to INSEE, notarial databases, deseasonalized INSEE Notaries Indices, Freddie Mac, FHFA, R.Shiller, US Bureau of Economic
Analysis, Census Bureau, Bureau of Labor Statistics, UK DCLG, UK National Statistics
Graphic downloadable at: http://www.cgedd.developpement-durable.gouv.fr/rubrique.php3?id_rubrique=138.
The residential property market in Ile-de-France and Paris in
the 2nd quarter of 2011
All the analyses and press conference pack can be found on the Notaires de France property portal
accessible at http://www.notaires.fr
Contact: Olivier Pavy, Director of Economic Affairs – High Council for the Notarial Profession. Editorial Committee: Pierre Bazaille, Thierry Delesalle,
Michel Pagès and Olivier Pavy. Published by: Conseil supérieur du notariat - 60 bd de La Tour-Maubourg - 75007 Paris - Tél. +33 (0)1 44 90 30 00
www.notaires.fr. Design and creation: Bureau de Création - ISSN : 2100-241X
French property
market report
Notaires de France - N° 13 - October 2011