French Property Predictions: What to Expect from the Market in 2022



French Property Predictions: What to Expect from the Market in 2022

As 2021 draws to a close, we asked our network of FrenchEntrée partners and experts to look ahead to the new year and let us know what they foresee for 2022. (That’s not all – we also asked them for their top tips for buying in 2022). From property sales and mortgages, to currency exchange and legal advice – here’s what our experts predict for the French property market in 2022.

Alistair Lockhart
Property & Mortgage Advisor

“The French property market will continue to evolve along with the pandemic. In 2021, we saw a definite shift towards emigration and wanting more space, and we expect this to continue in 2022.

Those buyers with higher budgets have not been put off by any Brexit ramifications and are taking professional advice where necessary. Those buyers with more modest budgets or where there are other variables (jobs, young families, etc.) are perhaps being more cautious given the uncertainty of the pandemic. 

The increase in budget for ‘income-generating’ properties will continue in 2022 with the continuation of the pandemic, the acceptance of working remotely by employers and families looking to have more space for their children – it feels like COVID has actually galvanized people who might have been on the fence for years. We’ll see this continuing in 2022. Prior to the pandemic, the most popular price bracket for buyers looking for revenue-generating properties was €150k to €250k. Since the pandemic and higher-earners being able to work remotely, this budget has increased to around €400k to €800k – with lots of buyers looking for chateaux to run events. 

There is a reduction in available stock as we head to the end of 2021, with agencies having far fewer properties on their books. In 2022 we’d expect this to become something of a seller’s market, with vendors holding out for their preferred selling price, knowing there isn’t the same level of choice for buyers as there was pre-pandemic. We’ll continue to see properties sell for their asking price in rural France – something relatively unheard of 2 years ago. 

If the pandemic gets under control during 2022, then we’d expect to see more vendors putting their properties onto the market around Easter or Autumn.

Arthur Cutler
French Plans

We see the market for British buying property in France to continue over the next year, though the current Covid situation means travel restrictions may continue for some time and adversely affect the usual purchasing timeframe.

People who already own property in France continue to sell and move to other areas and properties, and we’ve a substantial advance order book for 2022 for clients requiring planning and architectural services throughout the country. We’re very optimistic that will continue over the coming months and years.

From 1st January 2022, new thermal regulations come into force for all new build dwellings, essentially meaning new homes will have to be passive in terms of energy consumption.  The final details are still being worked on, and we’ll provide additional information at the earliest opportunity.  However, renovations, extensions and conversions will not immediately be affected by the new regulations.

Simon Frost
Communications Manager 
Atlanta Constructions

“House prices in France are going up – especially for the lower-priced properties. The values of the more expensive houses are pretty stable, but there is very strong demand – which is increasing – for properties priced under €200,000. On the positive side, land prices are relatively stable, especially on the outskirts of towns. However, prices are increasing in the centre of towns.

If you are looking for a property close to the coast – be prepared to pay more! However, let’s not forget that house prices in France compared to the UK and other markets are extremely affordable. It’s an exciting time for sure.”

French Currency Exchange in 2022

Mar Bonnin-Palmer
Senior National Accounts Manager & European Lawyer

Sterling buyers

There are 2 items Euro buyers should be focused on as we move in to the new year: COVID and interest rates. The Bank of England have already raised interest rates within the UK and are expected to do so again in the new year to combat the longer term inflationary concerns. With the European central bank unlikely to move as quickly, this increase will provide a widening yield advantage for the pound over the Euro as we move through 2022. Although this has already been somewhat factored in, it provides the possibility of a continued recovery in the pounds value against the Euro.

However, COVID remains the biggest uncertainty with the potential to alter the course of financial markets at short notice. If the latest variant leads to further restrictions being introduced here and abroad, we may well see a risk averse market, which we know from 2020 tends to favour the Euro over the pound.

Dollar Buyers and Sellers

The USD looks set to continue its winning streak in the short term with fears rising regarding the latest COVID variant leading investors to seek the safety of the USD. As with the UK, the US are already having to deal with high inflation meaning tighter monetary policy moving forward, which will be achieved through tapering of their bond buying program as well as eventual interest rate rises. This will add to the appeal of the US Dollar. As and when the COVID situation begins to improve, we may start to see things change as investors start to move away from the shelter of the dollar and back in to riskier assets, so Dollar sellers need to keep a watchful eye on global economic sentiment.

The French Mortgage Market in 2022

Alistair Lockhart
Property & Mortgage Advisor

The market will continue to be very difficult in 2022. As the pandemic continues, lenders will be extremely risk-averse, and only borrowers who meet the bank’s criteria (and then some) will be offered loans. If you don’t have a household income of at least €50,000 with some decent capital behind you, or if you are looking to buy a property under €150k, or if you work in a sector adversely affected by the pandemic (aviation, travel, hospitality etc.) it’s unlikely you’ll be eligible for a loan in 2022.

Similarly for US borrowers, but with a minimum purchase price of €500k and a minimum loan of €250k. Chances are that the pool of lenders will contract further, and I think we’ll continue to see very tight restrictions on eligibility for the whole of 2022.

Ready to buy in France in 2022?

Is 2022 the year that you’ll finally realize the dream of buying in France? Here are three things you can do right now, and all of them are absolutely free.

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