Sales deadlines, evolution of rates, negotiation margins … Thomas Lefebvre, the scientific director of lodging agents, draws up the inventory of a strongly heckled real estate market last year. If the worst seems to be passed, the future is not yet in good shape.
The scientific director of accommodation-agents.
© / DR
L’Express: How did the real estate market behaved in 2024?
Thomas Lefebvre: It is very complicated to make a unequivocal assessment, because the real estate situation has been moving and it has changed throughout the year. One thing is certain: last year has been the worst for a long time. The low point of the lower cycle, in terms of volume and price, was recorded in the first half. Since September, however, we have seen a return from buyers and a slight increase in the number of sales.
As the real estate market resumes a little vigor, prices have entered a stabilization phase. This good news is mainly due to a better financial situation, because individuals borrowed around 4.30 % over twenty years in early 2024, against 3.50 % on average at the end of the year. The drop in credit rates allowed them to find purchasing power and, mechanically, the number of solvent households has increased. Banks then distributed more credits, which contributed to leaving transactions.
However, if the real estate market is better at the global level, there is a strong heterogeneity at the local level. In cities where purchasing power has been the most constrained, that is to say those where prices have evolved faster and stronger than the buyers’ budget, the crisis was more marked. Price and sales are more important than the national average. For example, between 2015 and 2022, apartments prices increased by 50 % in Lyon and 52 % in Nantes. However, at the same time, the historic drop in credit rates, at less than 1 % over twenty years, has enabled an average purchasing power of approximately 30 %. The “surplus” increase is therefore assimilated to a real estate bubble, which is deflating today. As proof, between 2022 and 2024, the price of housing in these two cities dropped respectively by 13 and 12 %.
Is this analysis only for large metropolises?
No, because just after periods of containment, the medium -sized cities located near an employment area saw their attractiveness explode. They attracted households in search of more spacious housing or houses with gardens at more accessible prices. Faced with a completely euphoric demand and an offer that had not evolved and remained relatively low, prices climbed very quickly. This runaway phenomenon ended as soon as the interest rates have risen, because the purchasing power of the buyers then decreased sharply, resulting in a collapse of demand.
Today, the real estate market of these medium cities patina, with sometimes severe price reductions, as is the case in Rouen or Saint-Etienne. On the other hand, the agglomerations that have undergone a lesser excitement know rather a smooth landing of their market. The prices are slowly eroding there, from month to month, and this phenomenon will continue until supply and demand regain their balance.
What about the new?
On this market, prices do not evolve as in the old one. Construction is part of long time: it takes several years between the moment when a new housing program is envisaged and that when it comes out of the ground. With the crisis of recent years, the promoters found themselves caught up. Usually, they determine the sale price of their dwellings according to the cost of land, materials and labor. However, the three increased sharply after the pandemic of the covid and the trigger of the war in Ukraine.
This triple constraint led to an increase in the price of new housing put on sale at the very moment when interest rates climbed. Construction housing then became inaccessible and the rare buyers who had a sufficient budget to become owners have often favored the old, which has become more affordable. The new market then returned completely. The crisis that the sector is going through today is cataclysmic: in certain cities, the volume of sales collapsed by almost 90 %.
Currently, many promoters have stopped any construction and the number of transactions does not go up. Worse still: if the new accession market remains blocked, that of investment has completely disappeared. This is the first time in almost forty years that no tax exemption law has supported private rental investment in new, since the Pinel system ended on December 31, 2024. This absence risks amplifying the shortage housing for rent in the coming years.
Did the rental market escape the crisis?
On the contrary: the tensions that real estate professionals have noted for a few years have amplified. Today, the rental market is going through an unprecedented crisis, everywhere in France and particularly in major cities. The reason? All households that have not been able to buy in the past two years have remained tenants, which has resulted in a drying of the offer, with an average drop of 25 % of rental announcements. At the same time, demand has increased sharply, especially that of young workers and students, and it struggles to be satisfied.
However, paradoxically, thanks to the drop in prices and the average increase in rents, the rental investment offers in 2025 greater profitability than it was a few years ago. In Paris, for example, housing reports on average 4 % gross, compared to around 3 % in 2020. But many individuals hesitate to invest in stone to rent, because the legal and tax framework is not clear and above all very unstable . The year 2025 will therefore still be a complicated year for tenants, even if the shortage will loosen as the purchase volumes will leave.
What do you anticipate in the coming months?
The real estate market seems to get out of the rut. If the planned financial scenario, with stabilization of borrowing rates around 3 % in March or April, takes place as expected and the banks continue to lend, the volume of transactions will start slightly. But the uncertainty that reigns over the evolution of the credit market makes us careful. At the beginning of 2025, the OAT rate – the bonds that can be assimilated to the Treasury – which conditions that of real estate credits, made Yoyo by going from 2.8 to 3.5 % in a few days, before going back down. The recovery is therefore fragile, especially as the macroeconomic and political context, on a national and global scale, is very uncertain. This context could question the landing of rates.
In addition, even if the real estate market is better, we still see important sales times. Despite generally more coherent prices, especially in large metropolises where they are more in line with the new market situation, the negotiation margins remain high. They are now between 5 and 6 % on average, but can reach up to 10 % for certain dwellings without any particular assets and with work. Today, buyers have a finer knowledge of the market and they are very careful not to buy at overestimated prices. Especially since those who are the most active are in a very clear majority of Secundo-Ocsceders, that is to say people who resell accommodation to buy another.
The first-time buyers, who were very numerous when the market was euphoric, almost disappeared. As for investors, who represented almost 20 % of transactions during the prosperous period, they became rare. It is therefore necessary to bring them back, by developing effective aid to encourage them to buy, and by launching a new simple mechanism to support rental investment.
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