For the first time in 30 years, the heritage of the French fell in 2008. Although a small decrease in the light of the situation in other Western countries. Andre, a partner with (management consulting firm) and author of Wealth of the World , analyzes the situation.
For the first time in 30 years, the real estate of the French declined. How this fall?
In December 2008, vaiprévu compaction 3% of property value in France. We have not been surprised at the announcement of the figures The drop comes prices, rather than a decrease vt primarily from lower desolumes . It concerns both the non-financial wealth but also financial assets because of the crash of the stock market. But as in France, remains a minority share in financial wealth, unlike those countries, we talk of lower of real estate.
These figures shows a downward trend in prices, rather than behaviors in relation to property values. If one refers the previous situation, the current decline is figure correction. Since 2006, the report wealth / income was 8, that is to say that the heritage of the French was 8 times greater than their income. We were in a pathology report, and should have been alarmed in 2006. The current figures are much more reasonable.
the decline, particularly with regard to what is happening in other Western countries?
The comparison with other countries allows the relative decline in property values in France. All Western countries do not play in the same court. The indicator to be taken into account to understand the situation is the rate of household debt. The impact of the crisis is more severe in countries where the debt is heavy. The debt balance, the real estate market on both the old and the new. Thus the we are witnessing a decline in overall household wealth in the order of 16%.
The situation in France is more comparable to and countries where the use of credits is modest. Furthermore, regarding it's still different. The English property market is hit hard but this is explained by imbalances in the financial market rather than by lower prices or volumes.
What are the main developments of the heritage of French?
There is a real change from the 2000s. In 2001, before the changeover of financial wealth frança 41%. After the crack, there has been a retraction of the market, backed by a price increase on non-financial wealth. Thus in 2007, it represented only 22% of total assets, less than one third. For 2008, we are seeing a rebalancing: the non-financial wealth and settles back to a reasonable level.
What are your predictions for 2009?
2009 will be another negative year, but from 2010 we should see a recovery. With regard to housing wealth, the decline would continue at the same pace as this year. On the equity side, we see a rebound in the second half of the year, growth du40 should amount to 3%.
attention of buyers, interest rates too élevésdes banks ... The market is sealed in the ninth as the old. But already, prices began to fall and it's time to get back to prospecting. At certain conditions.
It is a 4-room of 95 m2 located on rue arrondissement of Paris), Le Marais, a neighborhood so popular with Parisians and foreigners he is among those who most soared in recent years. Yet, this former apartment of character awaits its owner for more than three months. Last Price 800 000 euros to the result of a succession - it is now proposed at 640 000. And even at that price, buyers are reluctant ...
Changing times and attitudes. Real estate is now hard hit by the crisis. The accelerated deterioration of economic situation has precipitated the land market has already started since 2007, and caused "a violent fit and sharp loss of confidence," Olivier analysis, an economist at Credit Agricole.
In the ninth, sales have collapsed (- 40%) over the last two quarters of 2008, particularly in the area of the house. "The end of the year was terrible and the beginning of it is of the same ilk," says Jean- Françoi , president of the Federation of promoters manufacturers ( ). For their part, transactions in the former declined 20% on average in late 2008, resulting in blockage of the market. Prices have followed. The decrease (- 10% depending on ) started by the province - including , Marseille and Strasbourg - and extending to the outer suburbs of Paris, and recently in the capital. And this movement is probably only beginning. "2009 will be a tough year," warns Guy of .
Such a reversal, professionals as assistant director of real estate studies of the Credit Foncier, not had not observed "long". After a decade of uninterrupted growth and euphoria (+ 140% + in the former and 75% in the nine), the French began to doubt. Driven, initially, by purchasing highly degraded conditions: rates soared this fall, and prices have reached unsustainable levels sometimes. Since then, the wait is up, fueled by uncertainty that continues to grow. "The development market has completely stopped in the 4th quarter 2008," says Guy , for example, recorded a drop in bookings of 49% in the second half of 2008! And the market resale, the withdrawal of buyers - do not even have time to visit - was just as brutal. "The number of our customers has been divided by ten," notes Stephen agency director and This lack is reflected in requests for mortgage banks (from - 40 to - 50% in January) and even in studies notaries, some of which have been fired. This neglect is even stronger than remain a "mismatch between household incomes and housing prices," said Claude president of the Credit Immobilier de France.
course, this degradation creditworthiness has in recent weeks, offset by lower rates (income to 4.70%) and the impact of government measures. The doubling of interest-free loan and Lantages for investors, led a comeback, modest buyers. In branches and sales offices, professionals observe a renewed animation. But "Spring is far from being back," Christian tempers "It's more of a catch than a thrill," says Michel rofessor of economics at Paris. Especially, calculeéconomiste chezFrance , the aid "will not be sufficient to reverse the downward trend in prices."
Today, on the ground, "only sales at negotiated prices are realized," warned Bernard Cadeau, president . Especially as buyers, anxious and hesitant, "anticipate, even before signing a future correction of the value of the property," Bernard of stress and Creamers , the two co- Estate. But if prices began to adjust, "their decline is still far from enough," insists Claude . Hence the discount demanded by buyers, some very important - "Offers sassy" in the words of , Director agencies. Patterns cite this 3-piece in Paris, offered 530,000 euros to 450,000 party. In parts of France too, "the purge is sometimes so rare," says As this 4-piece offered at 140,000 euros and sold at 105 000. In general, "what are the family apartments that suffer the most," says the boss of the study .
In the ninth, sales have collapsed (- 40%) over the last two quarters of 2008, particularly in the area of the house. "The end of the year was terrible and the beginning of it is of the same ilk," says Jean-François Federation president developers builders. For their part, transactions in the former declined 20% on average in late 2008, resulting in blockage of the market. Prices have followed. The decrease (- 10% depending on started by the province - including Marseille and Strasbourg - to extend the second crown in Paris, and recently, to the capital. And this movement is probably only beginning. "2009 will be a tough year," warns Guy
Such a reversal, as professionals , assistant director of real estate studies of the Land Bank, had not observed "long". After a decade of uninterrupted growth and euphoria (+ 140% + in the former and 75% in the nine), the French began to doubt. Driven, initially, by purchasing highly degraded conditions: rates soared this fall, and prices have reached unsustainable levels sometimes. Since then, the wait is up, fueled by uncertainty that continues to grow. "The development market has completely stopped in the 4th quarter 2008," says Guy , for example, recorded a drop in bookings of 49% in the second half of 2008! And, on the market for resale, the withdrawal of buyers - who do not even have time to visit - was equally brutal. "The number of our customers has been divided by ten," notes Stephen director of agency This lack is reflected in requests for mortgage banks (from - 40 to - 50% in January) and even in studies of notaries, some of which have been fired. This neglect is even stronger than remain a "mismatch between household incomes and housing prices," said Claude, president of the Credit Immobilier de France.
course, this deterioration in creditworthiness in recent weeks, offset by lower rates (income to 4.70%) and the impact of government measures. The doubling of interest-free loan and the law very advantageous for investors, led a comeback, modest buyers. In agencies and sales offices, professionals observe a renewed animation. But "Spring is far from being back," cautions Christianr economics at odds. Especially, calculates economist at France, the aid "will not be sufficient to reverse the downward trend in prices."
Today, on the ground, "only sales at negotiated prices are realized," warned Bernard Cadeau, president . Especially as buyers, anxious and hesitant, "anticipate, even before signing a future correction the property value, "stressed Bernard Creamers and , the two co- Estate. But if prices began to adjust, "their decline is still far from enough," insists Claud. Hence the discount demanded by buyers, some very important - "Offers sassy" in the words of , director of the agency bosses decitent rooms in this 3-lesson Paris, offered at 530 000 Euro party at 450 000. In parts of France too, "the purge is sometimes so bleeding, "said That this 4-pieces proposed at 140 and 000 assigned to 105 000. In general, "what are the family apartments that suffer the most," says the boss of the study .
The crisis took hold. But all the departments are not housed in the same boat. If the inner suburbs of Paris continues to resist, now the great suffering. Of course, ), with a price drop of 12.3% (yoy), is the exception that proves the rule. But at the same time, the city considered the worst of , was down only 5.6% when , plunged by 22.4%. In this department, between the third quarter and fourth quarter 2008, lower prices would have reached 18%, according to data from 21.
trend recorded at the end of 200s'accentuer? In 2009, according to a study commissioned by notaries to des Hautes Etudes Commerciales, prices would fall an average of 5% in the departments of the first belt and 9% in those of the second.
minds pessimists believe that the Great Crown could contaminate the child. "It's been two years we predicted that falls abysmal, but I still see nothing coming, "tempers , notary at Montmorency.
While negotiating a loan in times of crisis is an art. Tips and tricks to get there.
Crisis forces, the first step to successfully negotiate the credit is to achieve ... get it! For this, we must apply some simple rules. The form, first, is important. "Many cases are rejected simply because they are incomplete or poorly presented, "says Brokerage. Please also do not run off too much time between the promise of sale and visit your banker, it might think he is the ultimate resort after a series of rejections. Avoid it!
On the merits, some indicators will be observed under the microscope: the regularity of income and expenses, no debt - particularly credit - are appreciated. Better also have a personal contribution. "This is even more fundamental that no bank should lend more than 100%, analysis. And this is the first point you need to make. "For
muscle and decrease your file note, please no longer appeal to the myriad of existing subsidized loans (interest-free loan, 1% housing, aid from local councils or departments ...). Many are accessible, even for households with a certain income level. If you plan to work, remember to incorporate them into the loan, you will benefit from mortgage rates, not that of a consumer loan, often higher. Other
Runway rates, of course. Play competition is the best way to save money. For this, it may be useful to consult, in addition to one or more banks, broker: comparing the offers, this expert can help you achieve the best possible price. Please note, however, the pitfalls: to compare the offers as objectively as possible, always ask to know the percentage rate, which aggregates the nominal rate, insurance, bond or mortgage, and the costs of folder.
few perks to help get out cheaply
Negotiate the loan term may however prove to be .
"Many banks have given loans to thirty years, testifies , Spokesperson for the online broker . And when this is not the case, they charge rates are very discouraging, that drive up the cost of credit. "Besides
loan itself, to some sides may also help get out cheaply. Example: insurance. Most of the time, the bank offers "insurance group" which, in case of accident, supports credit repayment. It costs an average of 0.3% of the cost of the loan, but you can pay up to three times cheaper by using an "insurance company". This is a product offered certain categories of borrowers (young, non-smokers, and generally people with little risk of an accident) by insurers. Be careful anyway: "Some of these assurances apply under very restrictive states . If you practice some sports, like skiing or sailing, or you're driving a motorbike, you may be excluded. "
last tip: ask to benefit from the modularity of deadlines. Clearly, there is a clause to renegotiate its subsequent monthly payments to increase or down, no extra charge. Although useful in case of sudden drop in income. But also - why not? - In case of unexpected promotion ...
Tenants, a priori, should rejoice: rising rents continue to settle. Their progress was achieved last year, averaging 1.5% to 2% in 2007. She was still over 5% in 2004, according to the observatory rents Clamor. But the slowdown is not necessarily good news: "It reflects the difficulties faced by individuals and raising fears of a crash market," said Michael, an economics professor in Paris and author of the study.
It translates in any case real deterioration of the situation. In about a city of 2 (43.8%), rents have actually declined, as in Paris or Toulouse. Some municipalities, as noted Clamor, recorded declines sensitive, like (- 9.4%). Others, conversely, are still strong gains, as (+14.3%).
region remains the most expensive (17.30 euros per square meter on average) while continues down the rankings (7.90 euros per square meter).
crisis, fall of the pound: it is now plain dismal in these regions of France yesterday invested by customers across the Channel. And professionals are languishing.
"Please leave a message after the beep. "The announcement is welcome, coupled in the language of Shakespeare on answering estate agents in Normandy, Brittany or the Dordogne, may soon be an anachronism. British customers, who since the early 2000s, rushed on the ancient stones of our countryside redolent of sweet France, is now conspicuously absent. The plunge of the pound against the euro - it has lost a third of its value in eighteen months - and the financial crisis with a lot of redundancies and evaporation market, these buyers have driven so beloved of estate agents: "They bought cheap, quick and cash, sorry Valérie Bénard, agency Century 21 in Brantome.
In the small Venice of the Périgord Vert, the British accounted for up to 70% of customers ... Proportion fell to 30% today. An agency has already put the key under the door at the end of last year. In the Black Perigord - Sarlat, Bergerac - where prices had peaked, the turnaround is even more brutal. "We lost half of Britons who were buying in the Dordogne, "says Charles Gillooley, head of the agency and Causses Vézère to Thenon Fnaim and chairman of the department. In the medieval city of Eymet, with over 10% of the population is native in Britain, agency has had to lower its flag Bergerac few months ago.
She is not alone: to Locminé, in Morbihan, Brittany Immobilier has ceased operations since September. In Lower Normandy, as English, specializing in transactions on behalf of his compatriots, is selling his own home, a probable prelude to homecoming! For not only the British are not buying, but some try to sell their property. A challenge in those areas where the market was mainly driven by ... the British.
When buyers do not scramble over, the only solution is a drastic drop in the price: "The English have sold last summer for 370,000 euros a big old house with a cottage and 1 acre of land, paid 500 000 euro three years ago, "says Frederick Oliver, head of the agency Century 21 in Bayeux. But for the professional, reasons for departure are not just economic : Retirees arrived a few years ago is sometimes difficult to integrate, especially when they are reluctant to learn French. The advancing age, become less alert, more sensitive to isolation, they want to find their roots.
The fall of their purchasing power - of pensions paid in pounds sterling for daily expenses in euros - succeeds in convincing them. Just as the collapse of the UK market. For if they had offered a cottage in the Normandy through the sale of their two-bedroom apartments in London, they can now expect to buy a home in their country the result of French investment! Provided you accept losing 20, 30 or even 40% of their initial
The Perigord broods
Eymet its 2600 inhabitants, its castle, its arcaded square ... and five real estate agencies. They were six months ago. In this medieval city in the south of the Perigord, the British are rooted in the 1970s, but the boom of the 2000s had seen young affluent couples reach normal retirement. Today, professionals are holding their breath awaiting the start of the tourist season, which saw buyers appear potential. One of them is not an illusion: "Throughout the region, we sell a house on 10, against 1 in 5 last year. "
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