Has the Covid-19 slowed down the real estate desires of foreigners in France? According to a study of notaries, which Le Parisien reveals in preview, non-resident foreigners (those who do not pay taxes in France) represented in the first half of 2020 1.3% of buyers against 1.6% at the same period in 2019. This share is at its lowest for more than ten years! How much will this impact the real estate market? For the year 2019, the notaries looked at who was buying where, what and at what price.
What are they looking for? First of all, foreigners buy mainly… in the countryside. In fact, 45% of purchases are made in a “predominantly rural area” against 38% in large cities and 17% in peri-urban areas. The trend is reversed since, until 2014, foreigners bought in the city rather than in the countryside (in 2009, 36% in the cities and 50% in the countryside).
Where do they buy from? The Creuse (foreigners are at the origin of 11% of purchases), as well as the Dordogne (8%) and the Alpes-Maritimes (7%) are the departments which attract the most. In Paris, where the image of the foreign buyer is widespread, it is however at the origin of only 2.3% of purchases (- 0.3 point compared to 2018). A previous study by Apur with Insee had shown that the majority of owners of second homes in the capital are in fact… Ile-de-France residents!
Who are they? The British are the first foreign buyers in France (23%), but their share has been dropping steadily since 2016 (- 10 points), without it being possible to know if this is linked to Brexit, voted on the same year. “We see that they now sell more than they buy,” notes Peggy Montesinos, member of the High Council of the Notary in charge of real estate issues. The Belgians, mainly in the North-East, are in second position (19%), ahead of the Germans (8%) who are increasingly eyeing the Atlantic coast and the South-East. The Portuguese are the first foreign buyers in Île-de-France (12%), gaining five points in one year.
How much are they buying at? Foreigners mostly have lower budgets than the French. “They want to take advantage of low prices and that is why there are a lot of foreign buyers in rural areas or in the Creuse”, explains Peggy Montesinos. This budget tends to decrease in most regions. Exception to the rule in the South-East: the median budget of foreigners (over 260,000 euros) is higher than that of the French (less than 200,000 euros) and the price gap is growing with foreigners who are soaring. more and more (budgets up 30% in 2019, against 10% for the French).
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What impact of the Covid? Notaries have already observed a drop in acquisitions by foreigners in the first half of the year, throughout the territory with the exception of the North-East where their share remains stable (1.2%). This drop is all the more significant in the South-East where foreigners represented 3.8% of buyers in the first half of 2019, but more than 3.3% in 2020. In Ile-de-France, over the same periods, their share fell from 0.9% to 0.7%. Peggy Montesinos does not lend itself to the game of forecasts: “We will have to see the sanitary measures in the countries in 2021 to see if foreigners can move and therefore buy or not. “