Falling house prices?

[SC]

According to the director of 'de particulier a particulier' estate agency publication, it's quite possible that the price of houses will fall by 30-40% in the next five years, like it did between 1990 and 1996, due to current overvaluation. This isn't what most of us want to hear!
Around here (South56), it seems to me that individual building plots in areas popular with the French, and properties for renovation in areas inland popular with the British, are both considerably overvalued in relation to the finished project.
I wonder if the price of properties for renovation has escalated out of proportion because most of us Brits don't look at renovated properties (and their price) when we're searching?

sc

[le bouffon]

Oh dear what a shame never mind.Who do you blame for the price rise?

[Dotty0]

Why are we so worried about the value of our properties.  Its only valid if you are intending to sell.  I bought my French property early last year 2005 and am sure we paid more for it than if we had bought the same property 2 years ago.  But I am hoping to spend the rest of my life here, not buy a French property, do it up to make a euro or two.  Buying and selling to make money is a risk and if that's what one does then that's the risk one takes. 

Dotty 

[Apero]

House prices in our immediate area are still on an upward trend. The property market has slowed down of late, however it is a slow period.

DottyO im with you, not looking to sell just grateful we got in when we did. Like all of France different tendances for different Departments. Good news if it does slow up a bit as others may get somewhere without paying over the odds for it.

Ours has increased 418% I only know this as we renewed our Insurance recently (wouldn't have bothered otherwise) and wanted to be sure recent renovations were taken into account for cover.

What do others think?  Do the British in the main tend to move around France as much as they move around in the UK? Or dont they?

 

 

[Mpprh]

Hi

I assume you are talking about France ?

I think you need to quote more precise information on this.

My experience is that French prices in general are very stable. Normally, desirable houses appreciate by at least + 3% per year come what may. Rarely, they appreciate by up to 10% in very desirable areas.

Of course that is an average. I guess you are talking about 2nd homes ? And purchased in areas that are great for holidays, but not having good communications or local job opportunities.

Problem there is :

The initial low cost reflects low local desirability

Resale relies on other 2nd home owners buying, and most of Europe has a depressed property market (which influences the 2nd home market)

I was involved in this market in the late 80's - early 90's, and the holiday home market in Europe dived when prices dropped and interest rates rocketed (and we are talking 16+%)

Something to think about when buying : Why is this wonderful property so cheap ? Answer = it is of no interest to local French buyers ?

An article from Nomad maybe worth reading : http://www.the-languedoc-page.com/articles/languedoc-articles43.htm

 

Bonne chance

 

Peter

 

 

 

 

 

 

 

 

 

 

[geno]

He could be right. But if you look at overvaluation the UK is well in the lead of France, and France (and the rest of the euro zone) seems to be turning the corner economically while dark clouds are hovering over Mr Brown!

Part of the attraction of renovation is more than financial, it's about learning new skills and doing something you can be proud of, and feeling like you've rescued a house from impending doom.

There is a lot more to life than leaving money behind, there is enjoying what is left of your time on this planet and being able to say "I did that".

[Apero]

Hi Peter,

Assume you meant my post!

[quote user="Mpprh"]

Hi

I assume you are talking about France ?

I Did mention France in my post and mentioned Departments

I think you need to quote more precise information on this.

My experience is that French prices in general are very stable. Normally, desirable houses appreciate by at least + 3% per year come what may. Rarely, they appreciate by up to 10% in very desirable areas.

Of course that is an average. I guess you are talking about 2nd homes ? And purchased in areas that are great for holidays, but not having good communications or local job opportunities.

Peter our home is not what you would call a holiday area, we are situated 9kms from an SP, in a village where there is very little British and the ones that are there most are full time and some working,  no holiday homes we are aware of, we have 4 airports nearby, the furtherest is two hours away the closest under and hour, tgv is under an hour from us. So good transport links.  

Problem there is :

 

The initial low cost reflects low local desirability

Dont agree on that one, as there is new builds around, where you would agree, many not all young French people prefer newer homes. In the main all houses on the market do sell and sell rather well.

 

Resale relies on other 2nd home owners buying, and most of Europe has a depressed property market (which influences the 2nd home market)

By most of Europe do you include GB in that? As I'm aware GB is not a depressed property market.Agree that France has in certain departments, not in our SP currently.

 

I was involved in this market in the late 80's - early 90's, and the holiday home market in Europe dived when prices dropped and interest rates rocketed (and we are talking 16+%)

Agree about this, however, that was then and almost 2 decades ago. As we dont have a mortgage the cost of living increases will affect daily life, prices going up etc,  as will all of Europe.

Something to think about when buying : Why is this wonderful property so cheap ? Answer = it is of no interest to local French buyers ?

Who at the time of our purchased wanted a new build or newish home. They didn,t want to renovate older or less modern homes and we appreciated the potential and location of ours.

An article from Nomad maybe worth reading : http://www.the-languedoc-page.com/articles/languedoc-articles43.htm

 

Bonne chance

 

Peter[/quote]

We decided to purchase in France after many many years of holiday and business trips in a variety of Departments and choose on this experience. To date we have renovated the house to be our main residence when the time is right. The increase in valuation to us is only a figure, you can never put a price on pride and contentment this has given us and will continue to give us.  We wont sell and the added security for our children means more to us for the future than now.

Regrets that we have are that we should have done it much sooner and that my mother and my husband's father didn't get to see our achievements, although were sure they would have been as proud as our surviving parent's.

Geno agree with your post 'we did that'.

Regards.

 

 

 

 

 

 

 

 

[Anton Redman]

<< As I'm aware GB is not a depressed property market >>

Large parts of the UK seem to have a depressed property market judging by the number of houses which were still unsold 18 months after we finally sold our house in May 2004. Prices may not be falling except for distress sales but volumne of sales and liquidity in the market is right down.

[Apero]

[quote user="Anton Redman"]Large parts of the UK seem to have a depressed property market judging by the number of houses which were still unsold 18 months after we finally sold our house in May 2004. Prices may not be falling except for distress sales but volumne of sales and liquidity in the market is right down.[/quote]

 

Anton you are correct in as much as what you say volumne of sales and liquidity in the UK, certain area's and certain homes in the UK are slow in selling for individual reasons and at lower prices, location is a major factor as is schooling, condition, over-inflated asking price and sellability etc....  In our immediate vacinity in the UK, homes put up for sale are snapped up like hotcakes, which is obviously good for the seller and even more difficult for first timers.  The following link is interesting......

 

http://www.hbosplc.com/economy/includes/HousePriceIndexNov2005.pdf

Two of our three children are trying to get there foot on the ladder and it is very expensive as you know, so a slow down in house prices will be better for them, not so good for others.

[Miki]

[quote user="Sc"]

According to the director of 'de particulier a

particulier' estate agency publication, it's quite possible that the

price of houses will fall by 30-40% in the next five years, like it did

between 1990 and 1996, due to current overvaluation. This isn't what

most of us want to hear!

Around here (South56), it seems to me that

individual building plots in areas popular with the French, and

properties for renovation in areas inland popular with the British, are

both considerably overvalued in relation to the finished project.

I

wonder if the price of properties for renovation has escalated out of

proportion because most of us Brits don't look at renovated properties

(and their price) when we're searching?

sc

[/quote]

I am not sure about that 30-40% quote.

We were here then and cannot remember any of the places we had dealings

with or lived in, dropping anything like that, in fact, if at all

around the area we were living in but we know the very highest priced

regions at that time were slower in selling and many dropped their

prices to suit.

 We did know of several going cheap when Brits with second

homes in France were trying to get hold of some money to get them over

the slump in the UK but that did not really affect the French

themselves.

[Iceni]

My limited experience of the world hints that most people regard a house as somewhere to live, only the English regard it as a short term investment. The French have seen the prices that incomers are prepared to pay so set their sights and prices unbelievably high e.g a house in our hamlet has been for sale for 3 years starting at €230k now down to €149k but still no takers - does that mean that prices are falling ? Perhaps not.

When browsing before estate agents windows I can see neither rhyme nor reason behind the price variations other than wishful thinking perhaps. I don't know anyone who has sold here recently other than 1 couple whose former house/gites complex is on the market again with an asking price upped by over 100% since they moved in 2002. But it is still for sale after 4 months !! Perhaps hope is ahead of reality again.

John

not

[daniel]

The prices are not going down yet but this may happen in some places.

Even in my département, where 1000-1500 new inhabitant arrive every

month, prices are not going up anymore and lots of properties stay

unsold. In my village (Montpellier suburb) , you can't fing anything

below 250000 euros and there are maybe 15 properties for sale above

400000 €. Nice recent villas with swimming pools and beautiful gardens,

for sure. The few people who can afford this have plenty of choice but

sellers are still hoping and refuse to lower their price. As for hold

houses in need of major renovation, there is no rule. Most sellers ask

for unrealistic prices but it seems that some are not aware that the

market has raised so much. This is why excellent opportunities turn up

every week for those who are prepared to react quickly (they are sold

before being advertised) and know the french legal system well enough.

For instance, I found last week end two big houses (300m2; >3000m2

land) in the haut languedoc for 85-100 000 € with I guess the same

figure to be spent on renovation.