Real estate prices in Paris are falling amid changing buyer priorities.

In Paris, a "two-tier" real estate market is being observed, say real estate agents, with concerns about energy costs and the increasing number of people leaving Paris also having an impact. One real estate agent noted the emergence of a "two-tier" real estate market, where some popular properties sell within a day, while others remain on the market for years. Property prices in Paris fell last month, and one expert suggested that the capital's appeal has diminished due to changing buyer priorities during the pandemic.

On their website, Meilleursagents, real estate specialists stated that the average property price in Paris has stopped increasing and even decreased by 1% last month (November 2021). Barbara Castillo Rico, the chief researcher at Meilleursagents, commented: "Paris no longer attracts buyers looking for space, greenery, and purchasing power, which has led to a price slowdown of about 3.4% in just 14 months."

Real estate in Paris is still expensive. However, the data indicates overall price stability. As of December 2021, prices ranged from €9,455 per square meter in the 19th arrondissement to €15,305 in the 6th. Only three districts, the 13th, 19th, and 20th arrondissements, have prices below €10,000 per square meter.

Real estate agents claim that buyers have become more demanding and are spending more time negotiating prices, especially for properties requiring renovation. One three-bedroom property sold for €550,000 in the 13th arrondissement received offers of €500,000 - 10% less than the asking price. Thomas Venturini, founder of online real estate agency Liberkiz, said the changes particularly affected "overvalued" properties.

There are fewer apartments being used for short-term rentals, as the pandemic has affected tourism, and stricter regulations for platforms like Airbnb mean that investors are no longer interested. This influx of smaller apartments has reduced demand and impacted prices. Similarly, concerns about energy efficiency are creating uncertainty in the market.

The property website SeLoger indicated that from September 2020 to October 2021, the number of homes for sale with energy labels E, F, and G increased by 74% in Paris compared to September 2019 and October 2020.

The new energy law, the green law, sets its own deadlines: renting apartments with a G rating will be banned starting in 2025, F from 2028, and E from 2034. Property owners affected by this who want to keep their properties on the market must make the necessary changes by the specified deadlines.

Severin Amate, a representative of SeLoger, said: "This surge in properties with high energy consumption will impact prices, penalizing those with lower ratings." New housing that provides much more efficient thermal insulation is in very high demand.

Loïc Madeleine, deputy general manager of Sogeprom Ile-de-France, said, "There are very few new constructions in Paris, but the price can reach 13,000 euros per square meter outside the city centers and, in many cases, they are promoted only by word of mouth." Parisians are also increasingly leaving the capital, reducing overall demand and causing prices to fall accordingly.

In December 2020, the national statistical institution, the National Institute of Statistics and Economic Studies (Insee), noted that Paris has been losing residents since 2012. Currently, the capital is losing an average of 10,800 people each year, whereas from 2006 to 2011, its population was increasing by 14,000 people annually. The changes in Paris are occurring against the backdrop of rising real estate prices in other regions, especially along the Atlantic coast.

According to a recent study by the British credit site Money.co.uk, France ranks in the Top 10 OECD countries for real estate price growth, averaging €8,311 per square meter in 2020. New builds outside of Paris are among the properties that have seen the highest price increases, largely due to the "continuation of remote work" since the onset of the health crisis.