specialists hope, finally, for a real drop in prices in 2024

While professionals expected a price drop in 2023, they remained high and the number of transactions fell.

Despite a drop in the number of transactions of 18 to 25% in 2023, according to provisional figures, prices per m2 of houses and apartments remain very high. A real paradox that professionals find difficult to explain. The drop in prices is perhaps expected for 2024. All indicators were expected to lead to a serious decrease in prices of old real estate. This is what the boss of Century 21, one of the leaders in the sector, predicted.

There has been a drop in the number of transactions: 2023 ends at around 850 to 890,000 sales, while we came close to 1.2 million in 2021, a record year. Sales times have extended beyond 90 days, whereas we were less than 80 just a year ago. The market therefore slowed down significantly, which should have led to a real reduction in prices. But it didn’t happen like that.

Price drop in Paris and Île-de-France

In Paris, the average price per m2 has fallen below 10,000 euros but this drop of 5 to 6% is quite negligible, compared to the lengthening of sales times. Around 96 days: that’s twice as long as 10 years ago. In Île-de-France prices per m2 have fallen by 5 to 8%, depending on whether it is a house or an apartment.

This is not proportional to the drop in activity, since sales have fallen by a quarter in one year. If we look at transactions throughout France, excluding the Ile-de-France region, the drop in the price of old housing is only 1%.

“Real estate purchasing power reduced by 16%”

Buyers may reduce the number of m2 – we buy less than 49m2 on average in Paris now – but property candidates will not achieve their objective without the help of sellers.

“We can imagine that in 2024 volumes will continue to fall by around 10 to 15%, believes Charles Marinakis, president of the Century 21 network, but this time the prices must accompany this drop, at least around 7%. Because the real estate purchasing power of the French has been cut by 16% by the sudden increase in rates. We have to manage to reconstitute this 16%, he adds. And even if we make an effort on the rest, the sellers still have to pay 7% which I don’t know how to find elsewhere.” Provided that the drop in interest rates is confirmed below 3.75% and that inflation remains moderate.