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Edition February 15, 2019 - Crédit Agricole S.A.
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  • Edition February 15, 2019

    France – Real estate: recent developments and outlook for 2019

    The housing market should remain upbeat in 2019. Demand should be sustained by low lending rates and structural support factors. The market should see neither a bubble nor a sudden collapse. Yet, after an outstanding year in 2017, the market should continue to slow down gently. Transactions should thus see a slight decline in 2019 (-4% over 12 months in pre-owned, -6% in new-build) and the rate of increase in prices should slow towards 2%.

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  • Content:

    - Overview
    - Recent developments
    - Analysis and outlook

  • Extract – Market consolidation explained by several factors

    The slowdown can be mainly explained by:
    - The gradual refocusing of new-build support measures on areas of high demand (Pinel scheme and PTZ interest-free loan);
    - The erosion of purchasing capacity linked to the rise in house prices and stabilised lending rates;
    - The lack of supply;
    - Poor household confidence levels.
    In addition, lending rates would pick up slightly in the coming months. Risky assets are deemed to be more vulnerable due to the many uncertainties and the risks of a slowdown at global level. This is good for OATs, whose rates should nevertheless rise slightly, from 0.7% at end-2018 to 0.9% at end-2019, due to the ECB's halting of its asset purchase programme and rising US rates. 

  • Associative topics : France | Real Estate


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