Explore the current landscape of the France’s luxury real estate market, where transaction volumes are seeing a decline but prices remain remarkably resilient.
The France’s luxury real estate market has demonstrated remarkable resilience amid a challenging economic landscape in 2024. While overall real estate transactions have declined, the prestige segment has maintained stable prices and a recovery in demand, highlighting its unique position in the market.
A Challenging Year for Real Estate
The French real estate market faced significant challenges in 2024, with a contraction in transaction volumes affecting most sectors. Despite this downturn, the luxury segment exhibited notable strength. A recent study by Belles Demeures, part of the SeLoger Group, reveals that while total sales plummeted, the prestige market demonstrated resilience, driven by its intrinsic value, scarcity, and continued attractiveness.
Key Statistics
- Transaction Volumes: In 2024, the luxury real estate segment accounted for 3.9% of total sales in France, with approximately 33,000 transactions out of 845,000 nationwide.
- Market Value: Despite its smaller volume, the prestige segment represented 17% of the total turnover, underscoring its significance in the real estate landscape.
Segmentation of the Luxury Market
To better understand the France’s luxury real estate market, Belles Demeures categorizes properties into three distinct segments: Premium, Luxury, and Ultra-luxury. The entry price points vary significantly by region, with:
- Premium properties starting at €1.6 million in Paris but dropping to €600,000 in other departments.
- Ultra-luxury properties, while few in number, hold substantial heritage and symbolic value, particularly in attractive regions like Hauts-de-Seine, Alpes-Maritimes, Var, Haute-Savoie, and Corse-du-Sud.
Performance by Segment
- Premium Segment: Remained the market driver, despite accounting for nearly 90% of the decline in transactions.
- Ultra-luxury Segment: Experienced a dramatic 55% drop in sales, with only 430 transactions in 2024, down from nearly 1,000 the previous year.
Signs of Recovery in Demand
Despite the overall decline in activities, there are promising signs of a rebound in demand. Belles Demeures reports an 8.8% increase in demand among qualified buyers since early 2024, surpassing the 7% growth seen in the traditional market. This shift indicates a renewed interest in luxury properties, driven by discerning buyers seeking high-value investments.
Price Stability Amid Market Fluctuations
Interestingly, while general real estate prices in France fell by 2.5% in 2024, the luxury segment showcased remarkable stability:
- Premium Properties: Experienced a price increase of 1.4%.
- Luxury Properties: Saw a slight decline of 0.4%.
- Ultra-luxury Properties: Enjoyed a 5.3% increase, supported by limited supply and high demand.
Geographic Concentration of Luxury Sales
The France’s luxury real estate market remains highly concentrated in specific regions:
- Île-de-France accounts for 30% of premium sales.
- The Paris region and Provence-Alpes-Côte d’Azur (PACA) dominate the luxury segment.
- The PACA region is particularly significant in the ultra-luxury category, representing 40% of sales, with a focus on Alpes-Maritimes, Var, and Bouches-du-Rhône.
This geographic concentration underscores the sustained appeal of these areas, which continue to attract affluent buyers despite broader market uncertainties.
The France’s luxury real estate market has proven to be resilient in the face of economic challenges in 2024. While the volume of transactions has declined, the segment’s ability to maintain stable prices and witness a recovery in demand highlights its unique position. As the market adapts to changing economic conditions, luxury properties remain a sought-after asset, particularly in key regions known for their enduring attractiveness. For buyers and investors, understanding these dynamics will be crucial for navigating the evolving landscape of France’s luxury real estate market.
