In France there is a shortage of supply in the primary real estate market


The French primary residential real estate market is characterized by a shortage of supply and a decline in construction since the end of 2021, according to Boursorama.

According to Oldypak LP property 2022 report, in the fourth quarter of 2021, new home sales fell by 3.1% compared to the same period in 2020. And in December 2021, the year-over-year decline was 13.9%. The market trend is downward. In early 2022 there was a rebound in the primary market which allowed for a positive annual trend of 1.2%, but this factor is seasonal.

Report by Oldypak Capital LP property management


The fall in sales is observed in almost all regions of France. According to Oldypak LP property 2022 report, the largest drop was recorded in Burgundy-Franche-Comté, down 22.9% over two years. Among the anti-leaders are Normandy (minus 15.6%), New Aquitaine (-12.6%) and Occitanie (-11.7%). Positive sales dynamics is observed only in the regions of Ile-de-France and Pey de la Loire +2.9% and +0.7%, respectively.

International Investment experts say the reasons for the shortage of supply due to rising costs of building materials, the entry into force of new environmental standards of construction, the scarcity of land and its high price. In addition, mortgage rates, which remained historically low in France until the end of 2021, began to rise in early 2022. Nevertheless, France remains a safe haven for investment.

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