This time the word is out. The President of Century 21 in France, Charles Marinakis, has noted “market reversal” real estate in 2022. Until now, the Superior Council of Notaries only mentioned” landing “ or one “slowing down in the rise in real estate prices”.
First network of agencies in number of transactions, the brand Century 21 published, Tuesday, January 3, a report of the activity 2022, marked by a drop of 4.1% in the real estate activity, “consequence of a very marked slowdown in the housing market (-8.2%)”while these had been particularly popular in the wake of the confinements linked to the health crisis.
As for the average price per square meter, it increased by 4% in France for apartments (4,288 euros per square meter) and by 7.1% for houses (2,619 euros per square meter), on the whole of the year, thus reaching a historic record. However, a peak was reached in the summer, and prices “started to decrease in the second half”underlines Century 21. In Paris, they even fell by 2.4% in 2022, compared to 2021. The average price per square meter thus fell below the symbolic threshold of 10,000 euros, in September, then once more in november.
Rise in rates
This slowdown is reflected in the distribution of housing loans. The Banque de France, in a press release published on December 28, 2022, noted in the second half of the year a “relative slowdown”who “marks a certain normalization of the supply of mortgages, following the exceptional growth driven in recent years by the very low level of interest rates”.
A closed parenthesis. Mortgage rates for individuals have more than doubled in one year, from 1.06% in November 2021 to 2.25% in November 2022, according to the CSA Housing Credit Observatory. The establishments are passing on the tightening of the monetary policy of the European Central Bank (ECB), by means of an increase in its key rate in order to combat inflation.
This rise in interest rates, combined with the sharp rise in inflation, at work since the start of 2022, and reinforced by the war in Ukraine, has limited household debt margins and largely explains the current price slump.
Extension of sales deadlines
In Paris, this slowdown is also illustrated by an extension of the time for the sale of apartments (between the time when the agency receives the sales mandate and the signing of the compromise), “because sellers do not agree to lower their prices overnight”, underlines a real estate agent. These deadlines are now set at levels ” historically high »to eighty days in 2022 in the capital (compared to fifty-seven days in 2017 or forty-four days in 2011).
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