As interest rates eased and property prices adjusted downward, the French real estate market saw a rebound in sales toward the end of 2024, early 2025. Despite broader economic uncertainties, this trend is expected to continue in 2025, supported by more balanced market conditions.
In 2024, the existing property market recorded between 750,000 and 780,000 transactions, marking its lowest level since 2015. However, activity picked up significantly in the last quarter of the year, with a notable rise in sales volumes during the summer and strong growth in the final months. Overall, the year closed with a modest yet encouraging increase in transactions.
This forecast has been widely shared by different market players and the French press. They are based on specific algorithms like those from 56Paris Real Estate’s partner, Meilleurs Agents.
Though these numbers reflect broader trends in the French real estate market, they serve as a useful indicator for what to expect in Paris.
Key Factors Behind the Recovery: Mortgage Relief and Price Adjustments Lead to a Cautious Recovery
The recovery can largely be attributed to two main factors.
First, the improved mortgage landscape, with banks showing renewed interest in lending and mortgage rates declining. By November 2024, average rates had dropped from 4.42% in December 2023 to 3.37%, across all loan durations (excluding insurance).
This downward trend continued into January 2025, with average rates now at 3.10% for 15-year loans, 3.30% for 20-year loans, and 3.50% for 25-year loans. In some cases, these rates can be negotiated even lower, offering favorable conditions for buyers.
In some cases, buyers may negotiate even lower rates, with some securing 3% for 15-year loans, 3.10% for 20-year loans, and 3.20% for 25-year loans.
Secondly, the continued decline in property prices has partially mitigated the impact of previous interest rate hikes on buyers' purchasing power. Many prospective buyers have opted for smaller properties, resulting in a decrease in average purchase amounts.
Paris Real Estate Prices: Approaching a Turning Point with Optimistic Outlook for 2025
In Paris, this trend is even more pronounced, with a 9.9% decrease over the past 2 years, bringing the average price down to €9,321 per square meter, compared to €10,339 in 2022. Readers of our blog may recall our December 2024 post, where the Parisian Chamber of Notaries (Chambre des Notaires de Paris) projected the average price in Paris to reach €9,420 by February 2025.
It’s important to note that the average Paris price represents a broad figure that encompasses all 20 arrondissements and 80 distinct quarters. Prices vary significantly across neighborhoods, from as low as €6,560 per square meter in La Chapelle to €16,470 in Saint-Thomas d'Aquin, where 56Paris is located. Some neighborhoods have even experienced price increases: Monnaie (+2.9%), Odéon (+1.3%), École Militaire (+0.5%), and Invalides (+1.3%). In Saint-Thomas d'Aquin, premium properties continue to sell confidently at around €20,000 per square meter and above.
For a more precise indication of Paris' price per square meter and the number of sales, we eagerly await the final 2024 figures from the Chambre des Notaires de Paris. Stay tuned for updates when these figures are published!
56Paris Market Observations
This more rational market, coupled with improved mortgage conditions, provides a cautiously optimistic outlook for 2025.
At 56Paris, we confirm this emerging confidence in the French real estate market. Since the end of 2024, we've seen a notable increase in inquiries from both buyers and sellers. By the end of January 2025, traditionally a quieter period in the property market, we are busy conducting property estimates, signing new search mandates, and securing transactions. This uptick in activity signals that both investors and homeowners are recognizing the opportunities in the current market climate, reflecting the cautious yet growing optimism shared by industry professionals.
With prices at a turning point, more favorable interest rates, and the current €/$ parity, now is an ideal time to invest in Paris real estate.
For more, check out our latest properties for sale or get in touch to discuss options to buy or to sell.