The tide has turned in the market for prestige real estate after a significant drop in prices. Nevertheless, not all properties are equal.

Appreciated by both the French (Parisian and provincial) and foreigners (including French clients classed as non-residents under tax law) alike, the branch of luxury Parisian real estate bends, but does not break.

2014 saw a tentative upswing in the market. According to data gathered by the Notaries of Paris Ile-de-France (over a limited geographic area*) the number of deals of over €2 Million increased 3.5% between the First Quarters of 2013 and 2014, which followed a rise of over 5% between the First Quarters of 2012 and 2013.

It’s worth noting that the total value of sales (>€2M) closed in the “beautiful neighbourhoods” reduced by 30% between the First Quarters of 2013 and 2014, a sum of €470.7 Million.

So far as prices are concerned, movements vary. From the same Notaries’ data: the average deal price recorded in the Capital for the 2 year period 2012-2014 is €440,000, a fall of -3.9%. Yet, over the same period, the average price of properties in the €1M-€2M bracket and those in the >€2M bracket fell by -6.4% and -9.7% respectively.

According to professional real estate analysts, not all luxury property is equal. Those that fare well, that is to say, those that sell quickly and at a good price, are luxury homes such as a charming pied-à-terre with a view, and mansions and townhouses located in the Capital’s highly sought-after neighbourhoods, notably, the Left Bank. For these sorts of assets (>€2M), the prices don’t seem to have fallen. So called “family” homes which offer a good ratio of surface area/number of bedrooms go quickly because they are rare. By contrast, very large apartments (over 250m2) with few rooms always have trouble finding takers and are valued at the lower end of the scale.

A recent study by lux-residence.com** offers a portrait of the luxury property purchaser:

91% are second time buyers

75% have more than two properties in their portfolio

72% are buying assets

70% are over 50 years old

49% wish to purchase their principle residence (compared to 86% on the standard market)

28% are resident abroad

32% (1 in 3) have an annual income of over €200,000

* Areas: Paris’ 1^st, 2^nd, 3^rd, 4^th, 5^th, 6^th, 7^th, 8^th, 16^th, 17^th arrondissements; Neuilly; Saint-Cloud and Boulogne Billancourt. Figures taken from a study by Daniel Féau, Property Advisor, December 2014.

** “L’immobilier de prestige : tendances & previsions” by LUX-RESIDENCE.COM, December 2014.