Foreign investment and wealthy purchases look set to make the Paris real estate market, the star performer of 2018, even outranking Milan, London and Lisbon. It has already been ticking over quite nicely for three years, but experts predict 2018 could be the year when Paris emerges as the world’s top residential market.
Luxury homes in Paris have mass potential to grow 9% in value during 2018. The prediction sees other major cities like Berlin taking second place with Sydney and Hong Kong, while Spain’s favourite spot Madrid looks to achieve real estate growth of 5%. Buyers from Latin America countries currently favour Madrid because of political stability and familiar themes like the language.
Crediting economic performances with the global surge in real estate investment, other contributing factors include interest and currency rates, as well as taxes.
Paris’s entrance onto the stage of star performers is mainly because of a restructuring of France’s wealth tax. Previously causing several high-profile earners to leave France, the old charge prompted mass availability of luxury homes, therefore driving prices down.
A slide in value from 2011 to 2016 reversed on itself when France’s president Emmanuel Macron was elected. The presidents pledge to decrease annual wealth tax from all assets to just property, is peaking interest. The Financial Times has been keen to give much credit to the reforms which they say have boosted property prices.
Macron has also pledged to improve the fiscal framework that includes simplifying rental contracts and increasing the number of international schools in France but value for money when comparing average square meter prices in Paris as €17,461 to €30,485 per square meter in central London plays a part as well.
Domestic buyers seem to be driving the Paris real estate market, especially in the 16th Arrondissement, home to some of the city’s most wealthy residents and foreign embassies. As prices dropped, the bargains seemed too tempting to ignore.
However foreign buyers like the 6th and 7th seventh arrondissements known as artistic and cultural centres of Paris that includes famous landmarks like the Eiffel Tower and Champs de Mar.
FT report strong interest from Middle Eastern buyers, as well as China and the USA, but other industry insiders are focusing on British buyers of whom many want to get a foothold in European countries before Brexit happens in March 2019.
British buyers in France have already been told that anyone living or working there will have their rights secured, and this has promoted an increase in enquires. Many local and regional newspapers report France has a plan in place to attracts UK investors.
French politician Valerie Pecresse said…
"To investors, and to those disappointed by Brexit, I want to say that we are ready to roll out the blue, white and red carpet for you. Welcome back to Europe.”
Brits currently account for 10% of all foreign buyers in Paris but overall France has received a record number of passport applications from British people.
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