What is the impact of Brexit on Parisian real estate?
Since 2016, Brexit (a contraction of the terms Britain and exit) has been the subject of a lot of attention. Made effective on the night of January 31 to February 1, 2020, Brexit has had multiple consequences since the first referendum. Tell me about Paris analyzing for you the impact of Brexit on Parisian real estate.
Strong demand for Parisian housing
It is a fact: The Parisian real estate market is particularly tense. Indeed, there are, in general, a lot of requests and few goods available for sale. Thus, it is not uncommon for an apartment sale in Paris to be concluded at the displayed price, and this, in less than a day! How is this situation explained?
You are certainly aware that loan interest rates are at an all-time low. For potential buyers, this is naturally a major argument since the costs of borrowing are now derisory, or almost. It is therefore the ideal situation to start buying an apartment in Paris.
In addition, we must also highlight the impact of Brexit on this facet of Parisian real estate. Indeed, many expatriates want to return to France and settle in the capital. Parisian notaries have noted the phenomenon and indicate that they are essentially people with high purchasing power. This type of clientele invests in particular in Properties with large volumes and which have more than five pieces. The most exclusive districts of Paris are the most sought after: the 5th, the 6th, the 7th, but also the 16th and the 17th districts.
Rising prices
By causal relationship, the elements we have just mentioned undoubtedly lead to an increase in real estate prices. Indeed, while demand was already much higher than supply for large apartments in specific areas, the phenomenon has only increased with Brexit. The scarcity of goods, which are now even more coveted, is at the origin of the increase in selling prices.
So, if you are considering Buying an apartment in Paris, know that the square meter is now worth more than €10,000. This is an average: in the most prestigious neighborhoods, the price per square meter of certain exceptional properties can obviously soar. While the impact of Brexit on Parisian real estate is mainly observed in the districts mentioned above, prices are showing an upward trend throughout the capital.
The impact of Brexit on Parisian real estate: mixed opinions
Despite the elements we have just mentioned, some specialists express reservations about the effects of Brexit on Parisian real estate. First of all, they consider the loss of purchasing power of the British to be worrisome. Are they going to continue to invest in Paris for the long term? If so, will they be taxed more?
Second, some experts believe that the French capital will not be the first choice for businesses or expatriates who want to leave England. These specialists think that businesses and expatriates could find happiness in the south of France, but also in other European capitals, such as Brussels, Berlin or Frankfurt.
If we were to draw up a provisional balance sheet, we would see that Brexit seems to have increased prices in certain sectors of the real estate market in Paris. However, it is obviously still too early to draw up a real assessment of the impact of Brexit on Parisian real estate.
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