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According to “www.pap.fr”*, property price increased by 0.6% in September 2013 compared to the previous month. However, the “pap index” (“indice pap”) is based on transactions in the 8 biggest conurbations in France**. Therefore it excludes parts of the property market which may have experienced price erosion (e.g. some medium size cities and property market in the countryside).
As of the 1st of October, the “pap index” has increased by 0.61% for the flats and 0.63% for houses compared to the 1st of September. Over 3 months price were up by 1.32% for flats and 0.92% for houses. Despite being a rather modest increase, this trend contradicts the overall feeling that the property market has recently been on a negative slope. Since 1 January 2013 flats are up by 1.27% while houses are stable. This seems to be contradictory with the data revealed by the estate agents who still disclose a negative price trend. However, the “pap index” covers a smaller number of transactions and over a limited geographical scope**. Another interesting data is the negotiation rate (the percentage recording the difference between the advertised price on the website and the final agreed price) which remain almost stable at 4.58% for flats and 5.17% for houses. The time lag between the day the property is advertised on the website and the agreed transaction is 8 weeks for the flats and 11 weeks for houses -the same as in August- (which includes the 7 days of withdrawal from the buyer, once the “compromis de vente” has been signed off).
On the other hand, http://www.seloger.com ,which advertises flats sold by estate agents over the whole French market, reported a slightly lower price index in September at 130.62 points (-0.22 versus August). Seloger.com index is based on the advertised price or asking price and not the final acquisition price as it is the case for the pap index and the data regularly released by the French notaires.The seloger.com index for Paris reveals a price increase by 0.4% at Euros 9 255 /m2, while the estate agent network “meilleursagents.com” disclosed a decrease by 0.7% at Euros 8 250 /m2 (this is the “final” negotiated price, read our post ” Paris property market on a downward slope during September 2013″). The asking price is more forward looking than the final negotiated price, considering the time lag to find a property buyer. However, it seems too early to conclude that it will result in a recovery of the negotiated price in Paris within one or two months. Other trends revealed by the property advertisements published on seloger.com: Lille asking price decreases by 0.45% at Euros 3 137 /m2, Nice remains stable at Euros 4 120 /m2, Bordeaux is up by 0.22% at Euros 3 169 /m2. The highest increase in 3 months were recorded in Marseille +4.05%, Nantes +2.12%, while Perpignan, Amiens, Le Havre, Aurillac decreased by 3.5 to 5.5%. Clearly prices are more resilient in biggest conurbations than in medium sized cities, indirectly supporting the pap index trend (calculated with data from the 8 biggest French cities). Also, it would be interesting to see whether the upward movement in Paris, Bordeaux, Marseille, Nantes, is coming from an increase offer of smaller flats (with higher price /m2) following the reform of the capital gains tax, or from a real potential price recovery…We will have to wait patiently for the data from the French notaires released early next year, as they are the most reliable***.
*“www.pap.fr”, the specialist website for direct transactions between private owners without the intermediary of an estate agent.
**The pap index is calculated on a monthly basis based on transactions recorded by pap over the 8 biggest conurbations in France (Paris and its suburb, Marseille-Aix en Provence, Lyon, Lille, Nice, Toulouse, Bordeaux, Nantes) representing a population of 16 millions. The 1st of October index recorded the price trend over 10.658 transactions over the above mentioned area during September 2013. The price is of course the actual final price agreed by the buyer and the seller, and not the price advertised on the website. Access to the last pap index:
*** Notaires data are based on “final acquisition” contract (therefore lagging 3 months after the “compromis de vente” or 3 months after the pap index and the data from “meilleursagents.com”, and 4 to 5 months after the “seloger.com” data)