Developers are caught between rising material prices and difficult access to real estate loans.
The sector remains at half mast. Bookings of new housing by individuals with real estate developers continued to decline in the third quarter of 2023, with a year-on-year drop of 39.7%, according to provisional statistics from the Ministry for Ecological Transformation released on Wednesday 15. The number of bookings, which stood at 16,201, has been falling continuously already six quarters.
The same trend is followed by the number of new residential units offered for sale by developers, with a year-on-year decrease of 34.9% to 19,371. Developers find themselves amid rising construction costs caused by material prices. and more demanding environmental standards and, on the other hand, the erosion of the purchasing power of buyers with difficult access to real estate loans.
-32% in the most tense areas
The outstanding number of homes for sale, i.e. the entire supply that has not yet found a buyer, reached new heights with 131,414 homes available. Cancellations represent the equivalent of 24.5% of bookings for the quarter, “particularly high weight compared to previous flights”notes the ministry.
“Block” sales of all or part of schemes to major players (social landlords, institutional investors) jumped 20% in one quarter (13,723), with the state asking the Caisse des deposits and consignments (CDC) and Action Logement to buy back schemes from developers, to support them.
Bookings fell by 32% in one year in the busiest areas (Paris metropolitan area, the cities of Marseille, Lyon, Lille, Montpellier, part of the Mediterranean coast and Geneva, France). However, their decline is particularly pronounced in zones B1, consisting mainly of the centers of large cities and overseas departments (-46%), and B2, which corresponds to small cities and peripheral parts of the largest (-39%).