Montpellier: real estate prices are falling, and this is not the end yet.

In Montpellier, real estate prices have decreased by 3.1% over the year. Considering the increase in the number of properties available for sale, this decline is likely not over.

In the city of Montpellier, real estate prices have decreased by 3.1% over the year. And since the number of properties available for sale is increasing, the decline is likely not over.

Since the beginning of the year, property prices in France have decreased by 0.5%, but the city of Montpellier shows an even more significant decline of 1.4% over the same period. The average price per square meter in the city, which peaked in September 2022 at 3,776 euros, is now averaging 3,659 euros at the beginning of October.

How can I explain the dynamics of this city, which is simultaneously experiencing a drop in prices and a paradoxical situation of a shortage of properties available for sale? Properties for sale are accumulating, yet there is no situation of oversupply.

If the French real estate market entered a downward cycle a year ago, the 11 largest metropolitan areas in the country are no exception. Eight of them are showing a decline in prices over the year, including Montpellier, which has seen a decrease of 3.1% during this period.

The average price per square meter for apartments in Montpellier, at €3,512, is the most affordable among the 11 largest cities in France (followed by Lille and Toulouse at €3,650 and €3,673 per square meter, respectively, as of October 1, 2023).

Nevertheless, the price drop in Montpellier is still limited compared to other major cities, where prices have decreased more sharply, such as Lyon, Bordeaux, or Nantes, where prices fell by 8.4%, 8.3%, and 5.1% respectively over the year.

In these cities, the market is loosening up, sometimes with an increase in the number of properties for sale by 90% compared to the supply level in August 2018. In contrast, the number of properties available for sale in Montpellier is still below the levels of August 2018, which currently protects the city from a more significant drop in prices.

However, the number of properties is increasing from last year (by 38.5%), which suggests a market relaxation and a future decrease in prices. "The trend is more towards a recovery in the number of properties offered for sale in the largest cities of France due to difficulties in accessing credit and an interest rate that now exceeds 4%.

Real estate prices in Montpellier vary significantly between the city center and the east side. At the top of the most expensive neighborhoods are: the youthful and modern Port-Marianne area, which features the most beautiful contemporary architectural projects with a price of 4,738 euros per square meter; the cozy Bos-Ar neighborhood, where buying a property just a few steps from the historic center averages 4,451 euros per square meter; and the prestigious and residential Eglong area at 4,446 euros per square meter.

On the contrary, to the east of Montpellier, there are three of the most affordable neighborhoods in the city: Le-O-Massane ranks first among neighborhoods with an average price of 2,087 euros per square meter. The popular La-Payad neighborhood remains attractive with an average price of 2,278 euros per square meter. Still to the east of the city, the old village of Sellenève remains affordable with an average price of 2,751 euros per square meter as of October 1, 2023.

Methodology: New property price indices (IPI) and SeLoger prices as of October 1, 2023. The assessment of property characteristics is based on three data sources: the property value request database from Fisc, the BIEN database of notaries in Île-de-France, due to their comprehensiveness and historical data, as well as real-time property sales data from our partner agencies.