Property ladder now out of reach for many French

Buying a property in France is a dream for many foreigners and its starting to appear that way for the French themselves. In recent years locals in cities across France have found it more and more difficult to find the money to get on the property ladder.

Property ladder now out of reach for many French
Photo: AFP

The chances of buying property in France are dwindling, according to a new study by the Paris-Dauphine University and mortgage specialists Crédit Foncier.

The report revealed that despite lower interest rates household the spending power to get on the property ladder has gone down significantly between 1998 and 2010, leaving the dream of owning a house or apartment out of reach for many.

In 1998 some 44 percent of households in Paris were able to afford a property corresponding to their needs but that figure dropped to only 27 percent by 2010.

And it's not just Paris that's affected, indeed all of France's major cities have seen a drop in the capacity of locals to get on the property market.

Marseille takes the lead with a loss of 42 percent drop in the property buying power of locals within the 12 year time frame, followed by Paris with 39 percent, Lille with 25 percent and Bordeaux with 24 percent.

"The decline of the real estate buying power is mainly due to the increase in property prices and the impact of the crisis in recent years," the study read.

Wages may have increased by 23 percent on average from 1998 to 2010 but housing prices doubled within the same period.

"The rise in house prices was not accompanied by a similar increase in wages, although the increase in loan terms and lower interest rates helped increase the solvency of households," the study added.

People in their fifties and sixties have the best chances of acquiring property whereas the dream is much less likely to come true for those in their thirties.  

Only half of 30 to 35-year-olds are in a position to buy property corresponding to their needs in a regional city. In Paris it’s a mere seven percent.

As for the average 55 to 60-year-olds, some 75 percent have enough purchasing power to acquire property in regional cities and some 50 percent could get their hands on one in Paris.

Chances of buying property in Paris are low for the average 20 to 25-year-olds whose purchasing power is near zero in the capital. 

However there is some good news for those desperate to buy property in Paris.

As well as interests being low, the astronomical prices of property in the French capital continue to fall.

According to a real estate report this week property prices in the French capital have fallen 3.5 percent since the start of summer.

After falling around 1.5 percent in July and August the trend has continued with a one percent drop in September, according to the report by MeilleursAgents.

Since March 2011, when the housing market peaked, prices in the capital have dropped by a whopping 9.1 percent. Good news for buyers, not so positive for homeowners.

by Simone Flückiger

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.
For members


Property taxes: How much will it cost to extend your French home?

Installing a swimming pool, building a garden shed, or adding a conservatory to your French home has become more expensive in 2023.

Property taxes: How much will it cost to extend your French home?

If you are planning a renovation project in 2023 you’re likely looking at rising cost for materials and labour due to inflation – but there is one other cost to consider; taxes. 

In France there is a one-off tax that has to be paid on certain building works, and the government has raised the rate for this.

The taxe d’aménagement, sometimes referred to as the garden shed tax, applies to all property development – construction, reconstruction and extension – of buildings that require planning permission or a building permit.

Garden sheds, swimming pools or extensions with a surface area of more than 5 square metres are subject to the development tax – although a 50 percent reduction is applied to the flat-rate values of certain buildings, particularly the first 100 square metres of main residences.

READ ALSO Everything you need to know about installing a swimming pool at your French property

The tax is collected by local councils, who set their own percentage rates for the tax, working off the base rate set by the government.

A decree published in the Journal Officiel set the base figures for 2023 at the following rates: 

  • €1,004 per square metre in Île-de-France (up from €929 per square metre in 2022);
  • €886 per square metre outside Île-de-France (€820 per square metre in 2022).

The flat-rate values per square metre of building space, which constitute the basis for the development tax, are revised on January 1st of each year according to the latest construction cost index published by national statistics body Insee. 

Additionally, specific rates are set for:

  • €250 per square metre  for a swimming pool (up from €200 in 2022);
  • €12 per square metre of ground-fixed solar panels (up from €10 in 2022);
  • €3,000 per wind turbine more than 12 metres high;
  • €3,000 per pitch for tents, caravans and mobile leisure homes;
  • €10,000 per pitch for a holiday chalet or bungalow.

The amount of the tax is calculated according to the following formula: 

(Taxable area multiplied by the government-set base figure) multiplied by the percentage tax rate set by the local authorities. This gives the total to be paid in cents. Bills are rounded down.

So, the tax for a 30 square metre extension in an area where the combined local and departmental tax rates total 6.25 percent would be calculated like this:

30 (the size of the development) x 886 (the base tax rate outside Ile-de-France) = 26,580

6.25 (local and departmental tax) x 26,580 = 166,125 cents, more usually expressed as €1,661. 

If the total payable is less than €1,500, you will receive a bill in the six months after planning permission was granted, with details of how to pay.

Otherwise, it is paid in two instalments, 12 months and 24 months after authorisation, with a 10 percent surcharge applied in cases of late payments.

READ ALSO The hidden costs of owning property in France