HALF PRICE SALE Subscribe to one of our France Magazines today CLICK HERE

Election fever grips France

16:39 30 March 2012

Closed for business? How will the election affect the market?

Closed for business? How will the election affect the market?

Karen Tait

As the election in France draws nearer, how will the property market be affected?

The election in France is fast approaching. President Nicolas Sarkozy, of the centre-right UMP party, is campaigning to be re-elected, but is facing stiff opposition from the likes of François Hollande, the socialist who, for many, is regarded as the frontrunner in the election. Another François, M. Bayrou of the MoDem party is seen as a threat too, while, Sarkozy will also be nervously eyeing the far right, where another challenge to him is coming from Marine Le Pen of the National Front.

Sarkozy is fighting to avoid being the first one-term incumbent since Valéry Giscard, who failed to be re-elected in 1981. And the timing could certainly be better for Sarkozy, with the two-round election (on 22 April and 6 May) following hot on the heels of the financial crisis and uncertainty in the eurozone.

But what of the French property market? How will this be affected by the election?

Peter-Danton de Rouffignac, who advises on buying and selling property around Perpignan (www.FranceMedProperty.blogspot.com), says: “Looking back at comments in the early part of 2007, several referred to the election and predicted that 2007 would be l’année de la rupture with a dramatic fall in property prices compared with 2006 and earlier. Some even talked of a 25% drop till 2010 – in the event there was an overall reduction of 3% in 2008 and 7% in 2009, followed by a recovery in 2010.

“In early 2007 there was more concern about interest rates and the policies of the European Central Bank, amid admissions that housing demand remained ahead of supply. This was before the US sub-prime crisis and the collapse of Lehman Brothers in September 2008 which precipitated our current situation.

“Coming to 2012, there is a feeling that everything is on hold until June, though nobody can justify why. There were around 783,000 sales in 2011 (Notaires de France). Athough a report by L’Observatoire crédit logement CSA (8 February 2012) states that electoral years always provoke a ‘wait and see attitude’ among purchasers, it also cites the ending of the no-interest loan (PTZ) on 1 January, general economic uncertainty and concerns about unemployment among the factors that might contribute to a slowdown in the market in 2012 .

“Interest rates remain stable, the report concludes, and ‘the loss of France’s AAA rating appears to have had little practical effect. At worst there might be a rise of 0.5 to 1%.

“It is hard to find a reason for the caution simply due to 2012 being an election year. The parties have announced their programmes, and on the question of housing there is nothing dramatic in any of their proposals.”

Peter goes on to point out that all the major electoral contenders have drawn up rafts of proposals to help the supply of housing in France meet demand. Sarkozy’s include an emphasis on new-builds, the existing programme to sell or lease redundant public buildings and land to create more space for housing, and a proposal to cap rentals. François Hollande has spoken of building more social housing, giving away public land for social housing, penalising communes that do not build social housing according to current government levels, and capping rentals.

François Bayrou (MoDem) talks of putting onto the market the 500,000 empty properties (“Although analysis shows that there is generally a reason why a property is temporarily empty,” says Peter), helping tenants of private landlords, and ‘financial initiatives’ towards building and improvement.

0 comments

More from French property

Yesterday, 11:30
© Dreamstime

Laura Parsons of TorFX talks about transferring savings to France

Read more
Mon, 10:15
Brantôme, Dordogne

Karen Tait narrows down the best places to find the support and company of an expat community

Read more
Saturday, August 29, 2015
House buyers in France receive a dossier of information regarding the condition of the property

In France, house buyers receive a dossier of information regarding the general condition of the property. In this series, John Marshall runs through some key elements of the report

Read more
Thursday, August 27, 2015
Who hasn't dreamed of owning a pad in Paris?

Rachel Johnston trawls the Left and Right Banks for desirable pieds-à-terre under £1m

Read more
Tuesday, August 25, 2015
La dégustation de cognac en France

Many people dream of retiring to France, and with the range of benefits and choice of options available it’s hardly surprising, says Sam Bottomley

Read more
Friday, August 21, 2015
© Dreamstime

Money matters can be tricky when you live with one foot on either side of the Channel, so let Rupert Holderness guide you through the muddy waters of capital gains tax

Read more
Wednesday, August 19, 2015
Crêpes and Galettes from the Breizh Café

Enter our competition to win a copy of Crêpes and Galettes from the Breizh Café

Read more
Wednesday, August 19, 2015
FPN September issue 295

A preview of what you’ll find inside our latest issue

Read more
Tuesday, August 18, 2015
© Matthew Weinreb

Ian Purslow of Purslow’s Gascony explains why this imposing period home 20km south of Auch wins his vote

Read more
Tuesday, August 18, 2015
Nice © CRT Côte d'Azur

Lynette Eyb explores four cities that offer a rich heritage and easy access

Read more

Most Read

Our magazines

Living in France

Find valuable information, expert advice and real-life experiences to help you with all the practicalities of living in France. Topics covered include; working in France, retirement, healthcare, tax, finance and education.

Read more

Holidays

Find news, offers, information and advice on all aspects of taking a holiday in France, including information on travel, destinations, getting there and more.

Read more