Real Estate New in France: Why are sales on sale year after year?

The new real estate market has entered the unprecedented spiral of slowing. While access to real estate remains a priority for many households, the production of new housing has been at the lowest level for over 50 years. In 2024, only 59,000 new dwellings were stated for sale, which is a 50 % decline compared to 2022. This crisis, much deeper than simple cyclic slowing, is the result of a chain of structural and economic factors. Cost of increased construction, increasingly difficult financing, withdrawal from institutional investors: so many elements that slow rapid recovery.

Unprecedented collapse of new housing offers

The year 2024 means a turning point for new properties. According to the Ministry of Regional Planning, the annual housing volume for sale fell to 59,014 units, compared to the average of 125,500 a year between 2017 and 2022. Collapse, which originates in several factors, in the foreground, which the outbreak of construction costs and an increase in interest rates. These elements made it difficult for household ownership and drastically slowed demand.

The market was also hard to hit. In the absence of sales, players in this industry decreased their land and stopped a good number of projects. Pascal Boulanger, President of the Federation of Real Estate Developers, summarizes the situation: “The crisis fed the crisis: for lack of sales we did not produce new housing, stopped buying land and reduce our workforce.” The direct consequence is the drastic decline in the reserves of new projects, with the consequences throughout the industry, from employment to the times of construction.

Uncertain prospects of recovery and market under tension

If some hope that progressive reflection during this year, experts in this industry are more cautious. Federation of real estate developers determines “that the restoration of the machine will last for two to three years”. This late recovery is explained by several factors, especially the need to practice qualified staff and reconstruct soil stocks. With 5,000 experts who have left this sector, the production starting will not be without wage voltages and the availability of work.

Another main brake: the concentration of demand in certain areas. Paris, D’Azur coasts and border regions with Switzerland are now concentrating 50.7 % of reservations and 47.2 % of sales. Dynamics, which further emphasizes the imbalance between supply and demand that leaves many other regions in the situation -a -see. In this context, the budget measures from 2025 will not be, it should re -start the purchase of real estate, probably to immediately stop the crisis.

The French real estate market therefore enters the long and uncertain phase of the transition. If the production of housing is gradually renewed, the available offer will remain much lower for several years than demand. In the absence of a real structural recovery plan, new properties may remain under voltage, which has permanent consequences for prices, access to property and dynamics of large metropolis.

Luc Jose A.

A graduate of the Toulouse and the Blockchain Consultant Certification certification holder and I joined the adventure of Cointribuna in 2019. I convinced of the potential of blockchain to transform many economy sectors, committing to raising awareness and informing the general public about how the ecosysty developed. My goal is to allow everyone to better understand blockchain and take the opportunity they offer. I try to provide an objective analysis of messages every day, decrypt trends on the market, hand over the latest technological innovations and introduce the economic and social issues of this revolution.

Renunciation

The words and opinions expressed in this article are involved only by their author and should not be considered investment counseling. Do your own research before any investment decision.