What’s that saying? “We’ll always have Paris”? It’s more or less true for affluent investors looking to expand their global real estate portfolios. While the City of Lights may not match the explosive growth of new high-rise development in London or New York, it remains highly sought-after for its seductive charms and classic flats oozing Parisian flair — the parquet floors, the moldings, the wrap-around balcony with wrought-iron railing and city views.
“International buyers are more than ever charmed by the historic heart of Paris, drawn to its mesmerizing iconic landmarks and unique lifestyle,” says Laurent Demeure, president of Coldwell Banker France and Monaco.
The allure goes beyond the city’s fabled history and ambiance. Appealing real estate prices — at 8% below what they were a year ago —combined with plentiful inventory to suit all tastes and budgets, low-interest loans and “the impact of the euro-to-U.S. dollar exchange rate,” have all made Paris a magnet for international property investment as of late, adds Demeure.
“We are very optimistic for 2016,” he says. “In the first quarter of 2015, we tripled our volume compared to the first quarter of 2014. We are already seeing a strong and steady increase in transactions.”
“The proportion between the local and international buyers is fair, with both local and international buyers representing 50% of transactions each,” says Demeure. “The foreign buyers are mostly from the United States, Russia, Great Britain, France, Italy and the Middle East.”
Most buyers are relatively young — “in their mid-30s to -40s,” he notes.
Where to Buy
International buyers have long gravitated toward the city’s historic core. Demeure identifies five chic hotspots: Quai de Seine along the beautiful Seine River; Le Triangle d’Or, also known as the Golden Triangle; the 6th arrondissement-St. Germain area; “the peaceful oasis” of Île Saint-Louis, surrounded by the Seine; and the Marais, with its outstanding historical buildings and art galleries.
“These prime areas were definitely insulated from the downturn,” says Demeure. Still, great buys can be found in the 6th, 7th, 8th, 16th and 17th districts, as well as the Marais, “which are the exclusive areas,” he adds.
What to Buy
Most luxury buyers are looking for the rare combination of security, location and “Parisian atmosphere” — and are often unwilling to settle until they’ve found it, says Demeure. “We have seen an increasing demand for secure properties in good locations that offer the Parisian charm and an opportunity to experience a lavish lifestyle. Buyers have also increased their decision-making time slightly, in order to find the perfect ‘match.’”
“This elegant property in the 7th arrondissement embodies the high-end Parisian lifestyle, complete with a fabulous view,” says Demeure. Located opposite the Russian cultural center and high above the city, with an amazing panoramic view of Paris and its monuments, the interiors “can accommodate a comfortable yet lavish family life with a typical Parisian feel.”
In terms of building amenities, the must-haves typically include premium-quality furniture, stunning views and parking facilities. He has also noticed a growing number of properties renovated by internationally acclaimed interior designers hitting the market. “These properties are totally tailored to match international buyers’ expectations, whether from London, New York or Milan,” he says.
When you compare Paris to other global cities, it is “the leader in terms of value,” says Demeure. “Properties are less expensive in Paris than in London and New York.”
He offers an example. A brand-new townhouse in the exclusive and residential 16th arrondissement costs around 7 million euros in Paris. The same property in London would cost double the price with equivalent features.
He also says the weakness of the euro has been an asset for the French and Parisian markets. “The low euro rate has led to an increase in the number of affordable properties,” he notes. “International buyers are drawn to the euro countries to invest in real estate as a strategic investment plan.”
For U.S. buyers looking to invest in Paris real estate? His advice is simple: Think big.
“There are some interesting opportunities to purchase larger properties — starting from about 200 square meters in Paris — at the moment,” he says. “In 2015, there were about 250 residential sales of properties spanning over 200 square meters. For someone looking for a good investment, I would definitely target spacious properties rather than smaller ones.”