After a period of adjustment marked by a sharp rise in interest rates, the French real estate market is entering a new phase. The second half of 2025 is shaping up to be the start of a gradual and measured recovery, driven by positive signs for both buyers and sellers. This underlying trend suggests a return to equilibrium and smoother transactions, without, however, erasing regional disparities and structural challenges.
Purchasing power returns: lower interest rates bring back smiles
This is one of the main drivers of this recovery. After reaching record highs, mortgage rates have begun a significant decline, stabilizing at around 3% on average. This lull, combined with better-controlled inflation, is directly translating into an increase in purchasing power for the housing market. First-time buyers, who had been the hardest hit by the tightening of credit conditions, are gradually regaining their place in the market, thus reviving demand.
This improvement in financing conditions should allow the number of transactions to reach nearly 900,000 by the end of the year, a much healthier level and close to the historical market average.
A two-speed market: regional and typological disparities
While the overall trend is towards recovery, a closer analysis reveals a heterogeneous market. Major metropolitan areas like Paris are showing modest but significant price increases, confirming a return of confidence after a period of adjustment. The average price per square meter in Paris has even rebounded, stabilizing at around €9,500 .
Conversely, other major cities like Lyon and Nice are experiencing price stabilization, or even a slight decrease. Meanwhile, houses, particularly in rural areas and medium-sized towns, continue to perform well. The appeal of more spacious living, coupled with the widespread adoption of remote work, is maintaining strong demand for this type of property.
The challenge of new construction: a persistent shortage
Despite the recovery in demand, the new construction sector remains under pressure. The number of housing starts remains low, leading to a housing shortage. This situation could dampen the enthusiasm of first-time buyers seeking new properties and investors eager to benefit from schemes like the zero-interest loan (PTZ). For buyers, this shortage means limited supply and prices that, while not skyrocketing, are not experiencing a significant drop.
However, new government measures and the gradual adjustment of construction costs could eventually revitalize the sector and improve market fluidity. In the meantime, buyers' strategies should focus on identifying opportunities in the existing housing market and dynamic local markets.