After difficult years in 2022 and 2023, the high-end real estate market has picked up dynamically since January, according to the results of the Barnes network, specializing in prestige properties.
Luxury continues. “THE high-end segment did better than resist”, even estimates the prestigious real estate company Barnes, which presented an overview of the market and its results this Thursday, June 27. But as the legislative elections approach, the actors are worried: the thinning could be short-lived.
After two complicated years, with a slowdown due to rising interest rates, the market is doing better. At the peak of the crisis at the end of 2023, Barnes’ turnover had fallen by 20% over one year. But it is getting back on track with a “satisfactory” first quarter of 2024. In the second quarter, turnover even increased by 11% compared to the same period a year ago.
“Since January, buyers have been coming back and two thirds of them are new customers who were not registered in our files,” said Barnes general manager Richard Tzipine.
The resilience of the luxury market “confirms its status as a safe haven in the eyes of French and international customers”, even believes the president of the Thibault de Saint Vincent group.
Furthermore, this market is less sensitive to interest rates, because some buyers can pay cash, without resorting to credit. For second homes, buyers are also less rational, less careful about the price per square meter, according to Richard Tzipine.
Demanding buyers
In a context where buyers have more control over the market, they are nevertheless very demanding. According to the company, goods in perfect condition and corresponding to specifications have decreased very little, or even increased, in one year. Conversely, the price of those with defects fell by 10 to 20%.
“It is more essential than ever to be established in the most beautiful locations, with flawless properties offered at the right price” explains Thibault de Saint Vincent, president of Barnes.
After the explosion in prices in the post-Covid period, the time has come for a rebalancing of the prestige goods market. But depending on the regions and territories, the activity is not the same. Tourist destinations in general are holding up well, unlike large cities, according to company data.
On the coast for example, destinations like Deauville, the Arcachon Bay, the Basque Coastthe Ile de Ré, the Côte d’Azur and the Var coast (Sanary-sur-Mer, Le Lavandou) show stable prices compared to 2023.
In Marseille, the craze is confirmed with prices up 16% for exceptional properties.
“The peaceful and sunny life of the Marseille city attracts a high-end clientele with strong purchasing power who can telework,” explains Romain Linossier, deputy director of Barnes Marseille.
On the other hand, for large cities which are not located by the sea, the prices of luxury goods fall with up to -5% in Lille, -10% in Lyon and Nantes for example. HAS Paris finally, the drop in prices is contained at 4%.
Fears about the outcome of the legislative elections
If the company was rather optimistic, since the dissolution of the National Assembly, the worries have returned. “We have a German buyer who was very enthusiastic. Since the Europeans, he has been very concerned, he has doubts,” explains Basque Coast director Philippe Tomine Desmazures.
The company also records two cases of buyers who claimed “a withdrawal clause”in case the left comes to power, but their request was not accepted by the sellers. Barnes fears a flight of capital after July 7, in particular because of possible tax measures on assets. But its director remains optimistic and also sees luxury real estate as a safe haven in times of crisis.