Luxury real estate does not know the crisis
The year 2022 will have kept its promises in terms of price and sales volume for Junot. And 2023 is shaping up to be a solid year in a Paris real estate market that has become an international benchmark.
Paris is now considered a benchmark for real estate, especially in the eyes of international clients. The French capital has many assets to attract buyers, starting with the quality of its carefully preserved historic architecture. Investing in Paris has an emotional aspect, similar to that of buying a work of art. In addition, there is an undeniable financial security, as France is much less exposed than Anglo-Saxon or Northern European countries to sudden market fluctuations. As a result, foreign buyers, particularly Americans, returned en masse in 2022.
The number of sales made by Junot is 565 in 2022, an increase of 15.3% over 2021.
The average sale price for Junot was 15 400 €/m² in 2022, an increase of 6.7%. It should be noted that this price is 45% higher than the average price in Paris as reported by notaries. But probably the best sign of the stability and balance of the Parisian market is the average sales time, which has remained more or less the same since 2021 at 2.4 months between the receipt of the mandate and the receipt of an accepted offer.
* Of the 565 sales in 2022 in Paris
** Source: Paris Chamber of Notaries, January 2023 - Average price per square meter standardized in old buildings in 2022
A new rise from the upscale neighborhoods
After having been less sought after in favor of more "bobo" neighborhoods like the 9th arrondissement or the Marais, the bourgeois neighborhoods of the West are once again on the rise.
The proximity of schools, which are popular with families, green spaces and Haussmann-style architecture explain this renewed interest, which is reflected in Junot's increased sales in value and volume.
TERRACES, BALCONIES AND GARDENS: THE PRICE OF EXCEPTION
The criteria for choosing a prestigious apartment have evolved since the confinements of 2020/2021. In 2022, it is the outdoor spaces that are driving up prices, with a + 46.1% premium over an apartment without them.
At the same time, apartments with exceptional views seem to be gaining favor with buyers, with an average 25.5% premium on the sale price
Ultra-luxury: a healthy niche market
The ultra-luxury market (sales of 4 million euros or more) is seeing strong demand for houses with gardens or apartments with terraces in the center of Paris, mainly from American clients. These buyers spent an average of €6,980,000 for a price per square meter of €24,900, according to figures released by Junot Fine Properties | Knight Frank.
Paris is a dream, foreign buyers are back
The Emily in Paris effect
The number of sales by foreign buyers increased by 65% at Junot in 2022. The three most represented countries were the United States (21%), Italy (11%) and Lebanon (8%).
In addition to its history and architecture, which make it a safe haven, Paris has a double advantage in the eyes of Americans: an exchange rate that has never been so favorable to the dollar and interest rates that are half as high (about 3% in France compared to 6% in the United States). Buying in Paris becomes a godsend for them under these conditions. The success of the Emily in Paris series comes as the cherry on the cake!
High-end and luxury seem unsinkable
It is obviously difficult to predict how the market will evolve in 2023, given the uncertainties of the international situation. But the first trends observed by Junot at the beginning of the year show that the volume and the sale times are holding, that prices are stable or even slightly up and that the international clientele is still present. The only downside observed since the fall of 2022 is that buyers may take longer to make up their minds, and are mindful of the rising cost of financing.
This relative hardening of the sales process has not, however, been reflected in figures, as demand is sustained in relation to supply. The indicators are therefore good in the luxury segment, in a more balanced, more mature market.
Published on February 16th, 2023