Rural areas unexpectedly show the most active dynamics. Prices there have increased by 3.2% since the beginning of the year, which is significantly higher than last spring (+1.7%). Analysts attribute this growth to affordable prices and higher purchasing power compared to urban housing, which confirms rural areas' status as the most dynamic market segment.
There is a strong variation among large cities. The undisputed leaders of the spring dynamics were Nantes (+2.2%), Lyon (+0.9%) and Rennes (+0.6%), which are recovering from a deep price correction caused by a rate hike in 2022. At the same time, prices are declining in Bordeaux (-2.9%), Nice (-0.8%) and Strasbourg (-0.5%), with the drop in Nice seen as a belated adjustment that the city avoided in 2022.
Paris and its suburbs are moving in different directions. The capital is showing steady growth (+0.3% since January, +0.6% over the year) at an average price of 9,692 euros per square meter. This was facilitated by the deepest price correction (-11.3% in 2022-2024). Unlike Paris, the near and far suburban rings are still in a declining phase (falling 0.7% and 1.3% over the year, respectively), as their markets, which are more dependent on loans, complete the adjustment late.
The overall dynamics of the market is largely determined by the consequences of the conflict in the Middle East. Experts note that the "moderate shock" scenario is being implemented: inflation in the eurozone reached the projected 2.6% in March, while in France it is 0.5-0.8 points higher than pre-war expectations, while remaining well below the level of 2022 (1.7% versus 5.2%).
This has already led to an increase in loan rates by 16 basis points per month to 3.55% for 25 years.
Despite the risks, economists emphasize that the current situation is structurally different from the crisis of 2022. There is no previous excess of liquidity, and the market is moving away from a healthier base after the correction has already been completed. However, if the conflict in the Middle East drags on, a "moderate shock" may develop into a "sustained" one, which will directly affect transaction volumes, especially in cities where prices have not yet been fully adjusted.
