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The number of new homes started to be built in France in 2014 fall below the 300 000 psychological threshold. The exact number, 297 532 units, decreased by 10% compared to 2013 and reached the lowest since 1997. This “crisis” could lead to a deepening shortage of available homes in the following years:
- The number of new individual houses dropped by 18.9% compared to 2013, at 91 818, while new houses on estate lot were down by 19.6% at 34 985 units.
- New flats fared a little bit better, dropping “only” by 6% at 147 057
- 34 985 new flats were added to existing buildings (-17% versus 2013)
- The condo estates of flats with services (“residences avec services”) is the only segment up at 23 672 units (+26%)
New planning permissions granted for building new homes, also experienced a significant decrease in 2014 at 381 073, dropping by 12% from 2013.
However the 2015 Finance law, approved by the French Parliament at the end of last year, may help for a recovery, albeit timid, of new homes built in 2015. But the property developers remain largely pessimistic.Since the developers have drastically adjusted their activity to the current low demand of new property, the stock of built homes not yet sold remains stable, and perfectly manageable. Once the property market recover, there might be a shortage of new home due to the very low unit of new homes built during the past 2 years.
One of the positive measure voted by the French Parliament was further detailed in our previous post earlier in January, please do read “French finance law opens opportunity to buy building land in France”.