Developers building the Paris Olympics athletes’ village are struggling to sell the apartments after the Games are finished, due to France’s property market downturn.
According to France24.com, many of France’s biggest building groups have built residential towers across Northern Paris, to initially house the 10,500 athletes during the Olympics, before being converted into private homes, social housing and student accommodation.
However, with rising interest rates and a cooling property market, developers haven’t been able to make many sales.
Real estate expert at SeLoger and Meilleurs Agents, Thomas Lefebvre, said that sales of new-build homes had fallen by about 30 per cent over the past year in France.
“The market has turned very quickly, quite abruptly,” Mr Lefebvre said.
“We’ve gone from interest rates of around 1 per cent in January 2022 to 4 per cent today.
“The number of buyers has fallen considerably.”.
Of the 88 apartments put up for private sale by the Icade group in July, only 10 had sold, with prices down to 6,900 euros/m2 compared to an average price of 10,000 euros/m2 around Paris.
Across Paris, prices are down 2.4 per cent in the past 12 months, according to Century 21 and they expect prices nationwide to fall five to 10 per cent this year.
Most of the new infrastructure for the Games and the village was deliberately placed in the Seine-Saint-Denis area northeast of Paris, with a view to regenerating the most deprived area of mainland France.
In a falling market, part of the challenge for developers is drawing middle-class families to an area long associated in the public mind with rundown housing estates and high crime.
Stephane Plaza real estate agency owner in Saint-Ouen, Selim Mouhoubi, said the issue for developers was pricing the apartments too high.
“They haven’t put them on sale too early, they put them on sale with prices that were too high,” Mr Mouhoubi said.
“It’s always a question of price.”
Mr Mouhoubi said he thinks prices will have to fall a further five to 10 per cent to attract more buyers.
However, developers insist there is no need to panic and they have time on their side with modifications to the apartments likely to take another year after the Olympics and Paralympics on September 8.
“The only problem at the moment is the context,” Mr Mouhoubi said.
“It’s not a bad move to invest in this area.”