At the start of 2024, property prices in France were falling at the fastest rate in over 5 years. House prices in France fell by -1.0% in the 12 months up to August 2023 and are predicted to fall by -3% in the 12 months to November 2023. This decline in property prices is not uniform across France and it seems to be impacting larger houses more than apartments. 

According to research conducted by the the National Body of Notaires in France, the prices of older houses in urban areas of France (-3.8%) are falling faster than rural areas (which are predicted to fall by -1.9% at the end of November 2023). Generally, the prices of older apartments in France is expected to hold up, with -0.3% fall by the end of November 2023).

The report notes that during 2024:

Apartment prices would be stable in Lille, Marseille and Toulon, while significant annual drops, of at least 8%, would be expected in Besançon, Mulhouse, Nantes, Angers and Rouen.

[Source: Real estate market: trends and developments in real estate prices - October 2023, Notaires de France Notaires.fr].

House prices are beginning to fall in France as a result of the sharp decrease in the number of property sales. Here we analyse what has caused the number of property sales to decline and explain why 2024 will see a return of the Buyer's market in France. We conclude by looking at some of the best places to buy a house in France during 2024. 

French property market 2024

The French Property Market started 2024 in a quite an unhealthy state. According to the latest French Real Estate Market Report produced by the National Body of Notaires in France, the cumulative number of house sales in the 12 months up to 31 August 2023 stood at 955,000, a drop of -16.6% compared to the previous 12 months. The report noted that house sales had not fallen by such a level in over 10 years.

[Source: Real estate market: trends and developments in real estate prices - October 2023, Notaires de France Notaires.fr].

My wife works as a Real Estate agent in France, so I know first hand how difficult the property market is in France. Her sales and income have dropped by 60% in the last 12 months. But I also think that there needs to be some perspective here. The housing market in France is struggling, but it is wrong to predict that it will fall off the cliff in 2024. Firstly, it ignores the fact that the Property Market in France between 2018 to 2022 experienced an unprecedented boom, with property prices increasing by +27.8% and the rolling average of property sales topping over 1 million in 13 out of the 20 quarters. So there was bound to be a correction at some point.

Secondly, even if house sales in France have fallen to 955,000 in 2023 and will probably drop to around 880,000 during 2024, this is still an historically high number. If you go back twenty years, the number of house sales in France were only about 650,000 per year. 

Finally, there is a very specific reason why house sales have started to fall in France. Simply put, the French banks stopped lending money. As the authors of the Notaires Property Report conclude:

The current property market in France is contracting under the effect of the monetary policy of the European Central Bank (ECB) with a single objective of ensuring the return of inflation to its target of 2% as soon as possible

[Source: Real estate market: trends and developments in real estate prices - October 2023, Notaires de France Notaires.fr].

French Mortgages and the law of unintended consequences

During 2023, Mortgage interest rates in France rose to 3.63% (in August 2023), before falling slightly to around 3.0% by the end of 2023. Mortgage rates in France are expected to level out at 2.75% during 2024, before dropping below 2.5% during the first quarter of 2025.

Whilst the rise in mortgage interest rates has had some dampening effect on the French Property Market, it should be noted that interest rates in France have not risen by the same levels as other countries (for example the UK, Germany and Spain). What has really impacted the decline in French house sales in 2023, was a severe tightening of the regulatory rules on French mortgages.

During 2022, the French Government and Banque de France introduced regulatory rules which restricted new mortgage loans to a maximum period of 25 years (previously the maximum was 35 years) and capped the amount that could be borrowed to 35% of the borrower’s income. This so-called “taux d’usure” is calculated before tax and takes into account all other mortgages, loans and credit cards, as well as the fees and insurance on the loan.

The aim of these changes was to dampen the levels of consumer debt in France. The actual effect was that many French house buyers were refused housing loans and in some cases, loans which had been approved (in principle), were later rescinded.

[SOURCE: Housing loans in France 2018-2023 Banque de France]

You can see the impact these regulatory changes had on the number of Mortgages issued in France. This chart produced by the Banque de France, shows the almost immediate drop-off in the number and value of housing loans issued in France following the tightening of the lending rules mid-way through 2022. The decline has continued during 2023. 

The Notaires of France reported in November 2023, that

. . . notaries are seeing a lot of loan refusals, putting many projects on hold . . . . the readjustment of sales volumes is brutal and could continue to take place over the coming year.

[Source: Real estate market: trends and developments in real estate prices - October 2023, Notaires de France Notaires.fr]. 

In my opinion, I can see why interest rates had to rise to combat inflation. But the regulatory changes on top of rate increases, has had a result of putting a spanner in the works of the French Property Market. This surely wasn't what the French Government and the Banque de France intended to happen, especially when you consider that the rising property prices over the previous 5 years had helped improve the consumer debt situation of French homeowners, by increasing the equity in their homes.

In December 2023, following sustained pressure from financial institutions, banks, mortgage lenders and Real Estate agents, the Government began to back-track. The French Finance Minister and the Banque de France conceded that in cases where at least 10% of the housing loan will go towards renovation works, the loan repayments can be spread over 27 years instead of 25 years. However, the current maximum limit of 25 years for a standard mortgage will remain. During 2024, I expect that more 'reforms' will be announced, especially considering that the measures unfairly penalise first-time buyers.  

Historical trends: House prices in France 2008-2024

Here we highlight the historical trend in house prices in France over the last 10-15 years and explain why we think 2024 could be the best time to buy property in France. We analyse some of the reasons for the strong increases in house prices in certain locations, as well as identifying some of the best places in France to still find good value property.

Since the worldwide crash of 2008, the French property market has been hit by fluctuations in house prices and the levels of property sales. 2007 is traditionally seen as the 'peak' of the French property market. House prices had been rising constantly for 10 years, with some spectacular increases being recorded in 2005 and 2006.

Immediately after the 2008 crash, house prices in France fell by an average of -4.0%, as the global slowdown hit mainland Europe. There was a quick rebound in house prices during 2010 to 2011, but between 2012 to 2015, property prices in France fell back again as a result of low growth in the French economy, rising taxes and stagnant wages. By the summer of 2015, the price of property in some areas of France was -10% to -15% below the 2007 market rates. Virtually all the gains in house prices that occurred between 2010-2011 were wiped out.

Throughout 2015 and 2016, despite house prices barely moving, the number of sales went through the roof. The bottom of the housing market had been reached and what followed was an almost unprecedented 20 straight quarters of growth in both house sales and property price increases.

By April 2021, house sales in France surpassed the 1 million mark for the first time ever (1,068,000 properties were sold in France during the 12 months to April 2021). Between 2018 and 2022, property prices in France increased by 27.8%.

[SOURCE: Percentage change in property prices in France from 2001 to 2023, Statista.com]

During 2021, following the Covid-19 health crisis, the National bodies for French Real Estate agents (FNAIM) highlighted a noticeable trend in France whereby French homeowners were moving from urban to rural areas, where properties were cheaper and came with gardens and greater interior space. The experience of confinement in the cities and the increasing amounts of remote working, had pushed people to evaluate where they wanted to live. The sunnier climate in the South of France or an area of rural France with much more open space and nature, became decidely more attractive than living in a small apartment in the centre of the city. This change in buying patterns helped soak up the supply of rural homes and properties in provincial towns (as well as arresting long term declines in population levels in rural areas).

This trend has continued into 2022 and 2023. In fact, prior to the recent slump in property sales, many Real Estate agents in rural areas were reporting a very noticeable shortage in the supply of houses for sale. A lot of people had moved out from the cities into rural homes, so they were unlikely to move again so quickly. Plus, with the rapid rise in house prices since 2018, for existing home owners, why would they consider selling their house? Even if they wanted to up-scale/downsize their house - where would they move to? With a small pool of properties for sale, there was very little choice and very few good value houses and apartments. 

Similarly, land prices for new builds are probably the highest they have ever been and the cost of construction materials are about 20% above what they used to be prior to Covid and the Ukrainian war. 

With the prospect of house prices falling slightly in 2024, I think people will be even less likely to move. For those people that need to sell their house in 2024, then I think this will be difficult, unless they are willing to negotiate on the sales price. As the report by the Notaires de France, concludes:

" . . .The housing market, after mostly benefiting sellers, has now turned around. There can be a breakthrough only when sellers agree to lower their price, which, given the rises in recent years, is by no means unacceptable. But there is always a lag between falling demand and sellers agreeing to reduce their prices. 2024 looks like the year of adjustment, when prices fall to match the lower demand . . ."

[SOURCE: French Property Market Report 2023, Notaires.fr]

Future trends: French property prices 2024

So we have seen that the French property market is currently struggling, entering 2024 with falling sales and falling prices, but what will be the impact on French house prices over the next 12 months?

FNAIM, which represents Real Estate agents in France, have predicted that house prices will continue to fall by -5.0% on average during 2024 and the number of property transactions will remain below 900,000 for the next 12 months at least. However, their research highlights that prices will fall at varying rates throughout France.

House prices in Paris, the North of France and along the Atlantic coast in the West of France are predicted to be the areas most severely affected by declining property prices, with predictions varying betwen -7% and -15% in some locations.

The Ardennes in North-East France, is the only area of the country where prices are predicted to remain stable. Smaller falls in house prices are predicted in certain locations (Ski Stations and Mediterranean coastal resorts).

[SOURCE: Fall in Property Prices in France in 2024, FNAIM]

Regional trends in House Prices in France

 I think a lot of the locations where property prices are forecast to fall sharpest are those places where property prices have risen so dramatically in the last couple of years. I feel that during 2024, there will be a natural correction to the property market in France. Prices will fall heavily in some less popular locations, but I think that they will hold steady in areas where there remains significant demand (and a relatively low supply of houses).

We all know that property in Paris, Provence and Cote d'Azur is much more expensive than Northern and Central France. We also understand that if you move round the Mediterranean coastline by just 200kms into the Languedoc region, you can pick up the same property for virtually half the price, compared to Cote d'Azur. There are also some noted hot spots in France where property prices have been accelerating fast - such as Poitiers, Nantes, Angers, Le Harve and Caen. If house prices in these areas do fall back during 2024, it will probably be a real-time adjustment of the over-inflated price increases recorded during 2022 and 2023. But these cities all remain very desirable places to live in France and there is not an over-abundance of houses and apartments. 

Outside of Paris, the most expensive places to live in France remain Bordeaux (average house prices €385,000), Southern Corsica (€486,000), Lyon (€422,000), Montpellier (€418,500) and Toulon (€468,400). Again the rise in house prices in these locations over the last 15 years has primarily been driven by greater population growth (the graph for the growth in the population since 2000 in these cities, matches up almost exactly with the growth in house prices). Even if house prices remain flat or even fall during 2024, I do expect them to pick up again in 2025 in these locations.

Northern France - surging house prices

Mont St Michel, Northern France

North-Western France - covering Brittany, Normandy and Pays de la Loire - has experienced a strong growth in property prices during the last few years. The cities of Nantes, Angers, Brest and Rennes all recorded +7.5% changes in house prices from 2020 to 2022. House prices in Angers were still increasing at +6.8% during Q1 2023. However, even during the early stages of 2023 prices started to fall back in certain locations, most notably in Nantes where house price rises declined to +2.2% and Brest showing a -0.9% fall during Q1 2023.

The forecast from FNAIM, shows that these areas of Northern & North Western France could witness dramatic house price reductions during 2024. This is good news for house buyers, who will be in a stronger position to negotiate on prices. In addition, a lot of these locations have seen rapid house price increases since 2018, as they are all seen as desirable places to live in the North of France, so I would be reasonably confident that by 2025, house prices in certain parts of the North and North-Western France will start to climb back up.

For example the city of Rennes which is the capital of Brittany, reached #5 on the list of best French cities to live and it has seen property prices increase by as much as +20.5% in some years recently. Rennes bills itself as one of the greenest cities in France - both in terms of its gardens and parks, as well as its advanced network of electric public transport and cycle lanes. In Rennes, the spectacular increase of in property prices is driven by an excess demand for homes. According to INSEE, the French statistics body, in the last 3 years, the population of Rennes has increased by an average of +7.6% each year, bringing the total population of the city's catchment area to 438,865 people. The city is also home to over 63,000 students.  House prices in Rennes have subsided recently, with a +8.7% increase in 2022 and a +1.9% increase in 2023. Even if property prices do fall in 2024, I expect that they will soon recover in early 2025.

In a similar fashion to Rennes, the neighbouring city of Nantes has also seen rapid increases in its population. The city has doubled in size since the 1960s and it is now the 6th biggest city in France. Nantes is also a very young city, with 45% of the population aged under 30 years. This growth in the population has driven up the prices of housing in Nantes (with prices increasing by +9% in 2021 and 2022. The town is one of the most expensive cities to live in North-West France, with the average house selling at €364,300 in Q1 2023. 

The #1 place to live in France according to the by L'Express magazine survey, was the small city of Angers in North-Western France. Located on the edge of the Loire Valley, Angers is famed for its public parks and botanical gardens. Its popularity was summarised by L'Express:

. . . Angers provides the best quality of life in France based on a winning cocktail of academic and university excellence, a range of high-end care, sustainable development and reasonable house prices. This human-sized city has managed to preserve its natural spaces and its air quality . . .

Property prices have risen dramatically in Angers during 2022 and this trend continued into 2023. Average house prices in Angers were a fairly modest €315,000 in Q1 2023, having risen by +6.8% over the previous year

Le Harve, Amiens and Caen, on the North coast of France also recorded a similar large property price increases during the past couple of years of +16.2%, +18.1% and +11.2% respectively in the 12 months to March 2022.

During 2021 to 2022, the average house price in Amiens increased by a staggering +18.1%. Amiens, is a large University city and business hub in the Somme department, 100 kms South-West of Lille. Even with this dramatic increase, the average cost of houses in Amiens still only stood at €190,000 in 2023, well below the national average for France. House prices in Amiens continued to show strong growth during 2023, with an increase of +7.6% during Q1 2023.

House prices in the coastal city of Le Harve also held up in 2023 at +13.5%, but this price increase could be wiped-out during 2024.

The port-city of Caen on the Normandy coast, saw quite dramatic increases in property prices during 2021 and 2022. Caen is quite a modern city, with a lot of its buildings being constructed after the Second World War. During Q4 2022, the average house prices in Caen increased by a healthy +6.8% to €253,000, making it one of the most expensive places to live along the Northern coast of France (with the odd exception of towns such as Deauville, Honfleur and Saint Malo). But it looks like house prices could have peaked in Caen. During the early part of 2023, the increase in house prices in Caen slowed to just +1.2%  and could suffer further falls during 2024.

Western France house prices

Bordeaux, Western France

House prices along the Atlantic coast in Western France have grown strongly over the last 10 years. Property in the main city of Bordeaux has recorded +10% year-on-year increases since 2015. However, during the early part of 2023, house prices rises in Bordeaux were already beginning to slow down, recording just a +1.8% increase in Q1 2023. With the popularity of Bordeaux as a place to live and work, as well as the low supply of new housing in the city, it is unlikely that house prices will fall too dramatically in 2024 and any declines will probably be made-back in 2025.

La Rochelle is another location where property prices have surged over the last decade and may well escape the worst of the price falls during 2024. At the end of 2023, property in La Rochelle stood at an average price of 5 187 € per m² for houses and 6 855 € per m² for apartments, eclipsing even Bordeaux.

The popular university town of Poitiers in Western France, witnessed a dramatic increase in property prices from 2020 to 2023. House prices in Poitiers, first rose sharply during 2021 (+11.9%) and then by a staggering +17.5% during 2022, before falling back to a much more modest increase of +2.7% during the early part of 2023. But the average house still only costs €190,000 in Poitiers, making it a very affordable place to live. It seems that it is the demand for city apartments that is inflating the property prices in Poitiers. This may not be totally surprising when you consider that 1 in 6 people in the town is a student and over 30% of the population is under 30 years old.

Poitiers reached #2 in the list of best French cities to live and was described by L'Express magazine as:

". . . A paradise for young people who benefit from accommodation among the cheapest in France. With its theatres, its cinemas and its street festivals, the city offers a great quality of life and complete safety . . ."

The Dordogne remains a popular destination for both French and foreign buyers (especially with British, Belgian, Dutch, and German buyers, who make up around 20% of the market). The average price of a property in the Dordogne during 2023 was just €250,000, although this figure masks wide variations in prices between popular locations like Eymet, Sarlat, Brantôme and Saint-Jean-de Cole.

In the South-West of France, although house prices in Bayonne in recent months have decreased slightly, this follows an incredible 2 year period where the area recorded a +14.8% increase during 2022 and +11.8% during the 12 months to March 2023.

Central France - cheapest property prices in France 

Limoges, Central France

The relatively sparsely populated departments in Central France (Creuse, Vienne, Haute Vienne, Indre, Cher, Allier and Loiret) have traditionally been the cheapest places to buy property in France. This remains the case in 2024. 

The city of Limoges in the Limousin region of Central France, was recenly placed at #4 on the Top 10 list of best cities to live in France, and one of the key factors that made the Limoges so attractive, was the cheaper cost of property here. With just 208,000 inhabitants, Limoges is a small city, the 28th largest in France. Limoges is home to some of France's largest companies, including Legrand (electrical component manufacturer), Renault Trucks, Valeo, Schneider Electric and Haviland (a manufacturer of luxury porcelain goods, which draws on the city's long association with the Porcelain & Ceramics industry). In 2023, the average house prices in Limoges were just €187,600 and apartments cost an average of €1,650 per square meter.

In Bourges (the capital of the Cher department) there was a -4.7% reduction in house prices in 2022 and -0.4% fall in 2023. The average price per square meter of a property in Bourges  is just €1,520. An 80m2 apartment in the town will on average set you back just under €120,000.

Similarly, in Châteauroux (the capital of the Indre department) the average house sold for just €134,000 during 2023. Chateauroux remains the cheapest place in France to buy property. This is perhaps not surprising given this department has seen a -2.8% decline in population since 2012. However, the incredibly cheap house prices in Indre have in recent years seen an influx of buyers purchasing holiday homes. Around 10% of the housing stock in the department, comprises second homes.

Eastern France - modest growth in property prices

Lyon, Eastern Ffrance

Compared to property prices in North-Western France and the North of France coastline, house prices in Eastern France have not risen by the same levels in recent years. Price increases have been relatively modest over the last few years and property is still relatively cheaper in the East than it is in the West of France.

One of the cheapest place to buy property in France in 2023 is the industrial town of Saint-Etienne. Property prices here are just €1,210 per m2 for an apartment in the town centre. Average house prices were just €231,400 in 2023. Whilst property prices have been increasing in Saint Etienne over the last 12 months (rising by +7.1% in the first Quarter of 2023), they are nothing like the house prices in the neighbouring city of Lyon, just 60 kms up the road. In Lyon, house prices have been booming in recent years, with +10% price increases year-on-year. Although house prices seemed to have plateaued during 2023 (there was an increase of just +0.1% in the early part of 2023) the average house price in Lyon was €422,000 in Q1 2023 and value of apartments was just under €5,000 per m2 in the city centre.

In Dijon, the house prices were at a virtual standstill in 2023, with just +0.2% change in prices in the 12 months to Q1 2023 and the average price of a house in the city was just €257,100.

The city of Besançon saw a -1.2% fall in property prices in Q1 2023 and FNAIM are predicting that prices could fall by up to -8% during 2024. A similar fall in prices is also predicted for the nearby city of Mulhouse on the French-German border. Mulhouse is a fairly large town with a population of around 280,000 people, including the sub-urban districts. It is also one of the 'youngest' towns in France, with over 40% of the inhabitants aged under 30. It is a fairly pleasant town, with strong links to nearby Germany and Switzerland. In terms of general earnings in France, the average level of wages in Mulhouse is high and the local inhabitants are able to enjoy low housing costs. The average price for apartments in Mulhouse is one of the cheapest in France, standing at just €1,230 per m² in Q1 2023, (a -3.3% fall over the previous 12 months).

Property prices in Grenoble have performed relatively healthily over the last few years and even during the start of 2023, prices were still increasing by over +7.2%. It is interesting that the nearby Ski Stations in the Alps, is one of the few areas of France where FNAIM predict that property prices will not rise during 2024.

[SOURCE: Fall in Property Prices in France in 2024, FNAIM]

South of France - demand fuelling price growth

Montpellier, Southern France

Simply put, the South of France has always been a popular place to buy property in France, especially for Parisians and foreigners. House prices over the last few years have continued to grow across the South of France, with notable increases in cities such as Montpellier, Toulon, Nice and Aix-en-Provence.

The average house prices in Montpellier in South France have risen by more than €55,000 in the last 5 years. An average house in the city now sells for €418,500. Even though house prices are forecast not to grow at all in Montpellier during 2024 (there was a 0% price change in the first Quarter of 2023), the city still remains the most popular area of France to live, a trend which has seen Montpellier overtake Strasbourg as the 7th largest city in France. This University city on the southern French coast now has a total population of 277,639 - virtually doubling in size since 1960. 

The nearby city of Nimes in the South of France, just 50 kms north of Montpellier, has not experienced anwhere near the same growth in property prices. Property in Nimes cost nearly 40% less than Montpellier, with the average house selling for just €245,000 in Q1 2023. For this reason, Nimes could be a great location to buy property in 2024. Nimes was a former Roman garrison town and it has some beautiful Roman monuments, including a fully intact amphitheatre and the old market forum. Nimes has its own local airport (served by Ryanair flights to UK and Brussels) a TGV train station and the A9 motorway runs right past the city. Nimes is also the gateway to Provence and the beautiful Cevennes region.

But despite a similar transport infrastructure, old architecture and relaxed way of life; the two cities could not be more different. The Square meter price for apartments in Montpellier are currently running at €3,370 m2, whereas in central Nimes, you can buy an apartment for €2,080 per m2. 

Conclusion: house prices in France in 2024

The French housing market is expected to remain depressed during 2024, with falling prices and reduced sales. For property owners this will be bad news, but for buyers, this represents an excellent opportunity.

From a long term investment perspective, the French property market is a fairly decent bet. The property market in France has proved over recent history that it is sufficiently robust and able to withstand temporary periods of decline. French property is also one of the most well-regulated markets in the world and the high incidence of repayment mortgages (over 85% of the loans issued) and a property taxation system which penalises fix-n-flip property speculation; helps to keep the property market relatively stable. So overall, the outlook for property investors in France for 2024 looks positive, but not so rosey if you are trying to sell property.

Buying property in France in 2024 . . . ?

Artaxa Immo, is a French real estate business that specialises in helping Foreign investors buy French property. The agency is based in the beautiful wine village of Roujan and provides a property sales teams across the Languedoc region. Artaxa is a genuinely International real estate firm, employing multi-lingual staff in the three regional offices. For further information about buying property in South France, please contact Jane Laverock on +33 6 95 50 19 21 or by email at Jane@artaxaimmo.

Alternatively, if you have any particular questions you would like to ask about living in the South of France, then contact Iain by Email. If you liked the article then please share it with others using the Facebook and Pinterest buttons below.