Apparently, outside Paris, the real estate markets of the 50 largest French cities seem frozen: at the beginning of November, over one month, the average price index observed by SeLoger – Meilleurs Agents – Les Echos displays perfect stability and barely any erosion since the start of the year. But appearances are sometimes deceiving, in other words on average there are no people or not many people. In fact, prices continue to rise in certain metropolises while they plunge elsewhere, generally where the increases have been the most spectacular in recent years. These surges, uncorrelated with the evolution of the income of potential buyers, had the consequences of desolvating part of the demand, especially since interest rates ended up taking off from their floor level and the conditions for granting loans have tightened.
A rebalancing after a historic surge
Finally, the real estate landscape is redrawing in the direction of a slightly less pronounced territorial divide. This rebalancing marks above all the return to normal after years of surge fueled by historically low interest rates, which had artificially boosted values in metropolises like Lyon or Bordeaux. If the Gironde capital still resists, many overpriced cities are today facing sometimes brutal corrections. This is the case of the “capital of Gaul” which recorded a fall of more than 7% over one year. It is even stronger at Le Mans, which after having soared, suffered a reduction of 12.6% over the same period. This is the largest fall observed at the national level. Rennes and Strasbourg are also on a declining slope.
Coastal metropolises in resistance
Conversely, among the main pockets of downward resistance are the large coastal cities, notably Nice. Prices continue to rise so much so that the city is now ahead of Lyon and is positioned as the second most expensive metropolis after Paris. With its sunshine and attractive living environment, the Riviera capital attracts buyers who are generally older than the average, financially wealthier and therefore less exposed to variations in financing conditions such as rising interest rates. Added to this, for simple geographical reasons, is a land constraint which restricts the areas available for construction, as is often the case on the coast and in mountainous areas.
Marseille, a city in strong polarization
Marseille is a special case. Yet the second French city in terms of population and despite an average increase in prices still close to 3.5%, the Marseille city still does not enter the top 10 of the most popular metropolises due to the extreme polarization of its real estate market . On one side, there are very popular neighborhoods like Les Crottes where the price per square meter is only around 1,700 euros while, on the other hand, the most popular residential and wooded neighborhoods in Marseille like Roucas -White exceed 6,700 euros, a ratio of 1 to 4.
Paris, a targeted and uneven correction
In Paris, the market correction continues, but it is a targeted decline. The capital remains, by far, the most expensive city in France, even if its prices have been gradually decreasing since 2020. Along with Lyon, it is also the only metropolis to have recorded a decline over the last five years. The Parisian correction is all the more supported as it has recently been reinforced by new energy performance requirements, which complicate the rental and ultimately the sales of poorly insulated housing. In this market, which represents around 35% of the Parisian real estate stock, it is the buyer who finds himself in a position of strength. However, the difficulties are concentrated in the working-class neighborhoods of eastern Paris such as the 18th, 19th and 20th arrondissements, while the upscale neighborhoods of the west and center, notably the 7th and 16th, are resisting better. Small areas (less than 40 m²) continue to increase in value, thanks to constant demand from investors and young professionals.
Large French cities are in the process of reshuffling the real estate cards. Gone are the days of continuous surges: now, the weaknesses are exposed in broad daylight, and where the bubble has inflated the most, the collapse is all the more severe.
