French Real Estate Market Stabilizes in 2025 with Regional Demand Surges

French Real Estate Market Holds Steady at €3,060/m²

As of 2025, the French real estate market is showing signs of stabilization with average national property prices holding steady around €3,060 per square meter. Despite slight price corrections in Paris, demand has notably surged in cities such as Toulouse, Bordeaux, and Paris itself, with increases of 37%, 38%, and 31% respectively. However, transaction volumes remain below pre-pandemic levels, settling at approximately 750,000 for 2024. This marks a significant point of interest for international investors considering the complexities of the French market. According to International Investment, experts warn of potential risks of a real estate bubble if conditions such as overly accessible credit and speculative demand converge.

Regional Demand Surges: Toulouse, Bordeaux, and Paris Lead

In 2025, several French cities have experienced significant demand increases that highlight regional variations in market recovery. Toulouse saw a 37% rise in demand, while Bordeaux and Paris recorded increases of 38% and 31%, respectively. These surges reflect a renewed investor interest in urban real estate, driven by factors such as improved market conditions and mortgage relief. The 56Paris report indicates that the rebound in sales toward the end of 2024 and early 2025 was partially fueled by these factors, with mortgage rates remaining relatively stable at 3.10% for 15-year loans.

Transaction Volumes and Price Trends in Major Cities

The French real estate market recorded between 750,000 and 780,000 transactions in 2024, marking the lowest level since 2015. Despite this, there is optimism for a rebound, with transaction growth forecasted to increase by 8.2% by the end of 2025. Major cities like Bordeaux, Lyon, and Paris are seeing significant price growth, with Bordeaux experiencing a 3.6% rise, Lyon 2.5%, and Paris 2.3%, as reported by Homes Overseas. This indicates a nuanced recovery where regional dynamics play a crucial role in overall market stability.

Mortgage Rates and Financing Options in 2025

Mortgage rates have played a significant role in the current stabilization of the French real estate market. According to 56Paris, the average mortgage rates in January 2025 were around 3.10% for 15-year loans, 3.30% for 20-year loans, and 3.50% for 25-year loans. These rates have contributed to a more balanced market by making financing options more accessible to a broader range of buyers, thereby encouraging investment in both the primary and secondary housing markets.

Future Prospects for the French Real Estate Sector

Looking ahead, the French residential real estate market is projected to grow from USD 528.33 billion in 2025 to USD 697.52 billion by 2030, representing a 5.92% compound annual growth rate (CAGR). As outlined in the Mordor Intelligence Report, the mid-market segment commanded a 46% market share in 2024, and the affordable tier is projected to expand at a 6.11% CAGR from 2025 to 2030. This growth suggests a resilient market adapting to post-pandemic conditions, with particular strength in regions like Occitanie, which is forecast to post a 6.36% CAGR through 2030.

Investor Insights and Strategic Recommendations

For international investors, the current stabilization and regional demand surges in the French property market present both opportunities and risks. RealEstateAbroad.com analysis suggests that investors should focus on urban areas with demonstrated demand increases, such as Bordeaux and Toulouse. Additionally, with mortgage rates remaining favorable, investors might consider leveraging financing options to maximize returns. However, caution is advised regarding potential market overheating, particularly if the conditions for a real estate bubble converge. Therefore, it's crucial for investors to conduct thorough due diligence before making investment decisions.