Wednesday, August 15, 2012
The international appetite for French houses
Earlier this summer BNP Paribas published their excellent research on the number of international buyers of French property in 2011.
Getting reliable statistics on the French housing market isn't easy and this report is worth it's weight in gold for anyone who earns their living in this sector.
The headline figure was that there were 39,160 transactions last year involving international buyers which was a fall of 7% on the previous year. What wasn't quoted in the main report (but was in a smaller second report) is that of these international purchases 3,774 involved buyers from the UK which was a more dramatic 24% drop on the near 5,000 of 2010.
From the qualititive research that they undertook it's pretty clear to me that the underlying demand from the UK is still there but that buyers were reluctant to put their hands in their pockets at that particular time. The fact that the recession was biting, the pound v the euro was not particularly attractive and we had a French election looming could all have played a significant part.
The domestic French market remained strong with a healthy number of transactions and my gut feeling is that the next couple of years will see the BNP Paribas surveys showing that France comes back into favour with British buyers.
The other headline was that while the number of international buyers had dropped this was offset by their increase in budgets. The overall average budget of UK buyers was €260,000 which was a whopping 14% increase over the €229,000 the previous year. This increase was mirrored across the board by international buyers as a whole - is this a case of the "smart money" knowing that the French property market is a safe haven compared to many other European asset classes?
The overall conclusion of the BNP Paribas team was that:
"The French real estate market remains a sound investment and today's customers are choosing France more spontaneously than other European countries which have been more affected by the economic climate. This has led to a high level of satisfaction in terms of purchasing".
Comforting words indeed.