Paris’s Arc de Triomphe, Notre Dame Cathedral, or the Louvre Museum – with its wealth of sights, historical architecture and world-famous buildings, the French capital is more than just a tourist magnet. As one of the top three cities worldwide for ultra-high-net-worth individuals (UHNWI), Paris is popular among these affluent few both as a place to live and as a location for business and investment. The metropolis ranks high for its superb quality of life, its excellent leisure opportunities, and its unique architectural style, hence attracting buyers and investors from all around the globe. “For many years, Paris has been a sought-after location among domestic and international clients for both first and second homes. The coronavirus pandemic has by no means diminished the appeal of Parisian real estate. On the contrary, interest has risen as time has gone on. The catch-up effects, in particular, have benefitted real estate transactions here,” reveals David Scheffler, CEO of Engel & Völkers France, Belgium and the Netherlands.
Market research conducted in June 2020 showed that, despite the sanitary crisis and lockdown, the yearly average price per square meter had increased by 5.2 percent compared to the past year 2019. Due to the prevailing excess in demand for Parisian real estate – an average of seven prospective buyers are interested in each property – forecasters expect prices to continue to rise for the foreseeable future. An increased perception of real estate as the most secure investment and a nonetheless very high ownership rate of 63 percent in France drives the appeal of and the demand for properties in the Parisian real estate market. At the beginning of the coronavirus pandemic, there was evidently a lack of certainty on the part of buyers. “Through digital technologies such as virtual viewings, we were able to bring about numerous deal closures with domestic clients despite the social distancing restrictions. Our clientele, who have great faith in the real estate market in general, are very positively disposed towards these new digital possibilities. This meant we were able to conduct viewings and execute some transactions even during the lockdown between March and May,” David Scheffler explains. After the easing of restriction measures, there was a notable rapid recovery of the market. Likewise, the opening of the country’s borders in early June prompted renewed activity among international buyers, who had previously only been able to follow the Parisian real estate market as observers but subsequently started acquiring properties again.
The most exclusive addresses in Paris are located in the 6th, 7th, 8th and 16th arrondissements. This year, selected top properties exchanged hands for as much as 10 million euros. Premium freehold apartments have been sold recently for top prices per square metre ranging from 27,000 euros to 33,000 euros in the 7th arrondissement. The average price of 10,900 euros per square metre in Paris is likewise relatively high. The domestic and international buyer groups in the Parisian real estate market account for 70 and 30 percent respectively, meaning French buyers dominate this market. International buyers come primarily from the United States of America, Italy, Great Britain, United Arabic Emirates and and Switzerland. The majority of buyers tend to opt for freehold apartments in the city’s characteristic Hausmann style. Special features such as terraces, gardens, inner courtyards and balconies are currently highly sought after. Engel & Völkers France is registering another trend too: “Houses and apartments in the centre of Paris with outdoor spaces, terraces and gardens give residents the chance to relax in the city. The constantly rising demand for properties with outdoor spaces like balconies and terraces has intensified since mid-May with an average rise in demand of 20%. Properties in more leafy areas closer to the outskirts of Paris such as Boulogne-Billancourt and Neuilly-sur-Seine are set to also become increasingly desirable”, says David Scheffler.