Paris needs no introduction-it is the “City of Love,” known to all by the romance of its iconic landmarks, stunning vistas, and wide boulevards. Those seeking a luxurious lifestyle choose Paris for the sweeping architecture of its grand estates, historic chateaux, private mansions, luxurious pied-a-terres, and duplex penthouses. The most prized residential areas in Paris include the 16th arrondissement, or, “Arrondissement de Passy,” which features exceptional views of the Eiffel Tower and elegant, upscale residential neighborhoods. The exclusive 7th arrondissement, located on the River Gauche, is home to the globally recognized Eiffel Tower and in turn, houses luxurious properties with breathtaking views of this iconic symbol of Paris. Exceptionally beautiful, Paris stands as one of the world’s most fascinating and dynamic cities, with cultural and entertainment attractions catering to every taste.
The most essential supporting factor in the French real estate market today, very low interest rates, still prevails. In addition, French banks typically start the year with high loan goals, making it easier to obtain a loan at the beginning of the year.
If you replied, “Hell, yeah!” to all the above, congratulations!—you’re ready to live the dream. Because here’s the thing: unless you can afford to drop a few million euros on move-in-ready-Haussmann-perfection in the 7th, you’re going to have to be made of hardy stuff as you embark on this journey. Hardy, and a little nuts, because let’s face it, if you’re from the States, there’s no logical reason to buy property in Paris given the state of the economy, and the current tax and short-term rental laws.
What’s the property market like in France?
At the moment the French property market is in the middle of a steady incline, and has been over the past two years. The price of housing has increased by as much as 8%, depending on the home type and location.
Despite a major dip in 2009 and again in 2013, France’s housing market is generally seen as relatively strong, as the country boasts a wealth of desirable property for investors and vacationers.
That being said, many French people choose to rent instead of buy. This is typically credited to massive home prices, which in Paris have peaked to about €8,000 per square meter in the past few years. Most young families simply can’t afford to purchase property in the cities, and– as is true nearly anywhere– are unwilling to sacrifice their urban lifestyle in exchange for the relatively less expensive cost of property in more rural areas. All in all, when you consider renting vs. buying in France there are distinct advantages to each, and depending on your financial standing and intent for the property the right answer is different from person to person.
House for sale in Paris, France – Paying cash rather than taking a mortgage. Many people simply don’t like to owe anyone any money, but any investment counselor will tell you that ‘leveraging’ your money to invest further is a smart move. Why use your own money when you can use someone else’s? Add to that the current low interest rates and it makes for a perfect environment to take a mortgage. If your property generates rental revenue, then the tenant, in effect, will pay a part of your mortgage on your behalf, further reducing your investment and increasing your ROI, or “Return On Investment.” In France, non-residents are liable for wealth tax on assets physically situated in France over a value of 1.3 million euros. If your property is mortgaged, then only the amount of the principal of the loan is considered an asset owned. All these reasons and more make taking a mortgage a smart move.
Assuming that the agents work nights, weekends or holidays. Businesses in France do not work nights or weekends or holidays — sometimes by law! So, while we are used to an agent working at times when the client is free to visit properties, they do not make the same kind of effort here. If you are planning a trip to Paris specifically to visit properties, it would be wise to plan accordingly and allow enough time on the weekdays, avoiding vacation periods: school holidays, much of the month of May, mid July to the end of August and over the Christmas/New Year season.