Real estate: new apartment prices are on the rise

Buying a new apartment is becoming more expensive. The average price per square meter of new apartments offered in municipalities with a population of more than 45 thousand people increased by 7% between May 2021 and May 2022, in a document published on May 19, estimates the real estate laboratory, a service specializing in market execution. Studies within the insurance brokerage firm Theseis.

That price has dropped from €4,900 to €5,250, according to this study revealed by BFM Business. The cost of a new apartment of 50 square meters in these municipalities increased from 245 thousand euros to 262,500 euros. In the 15 most populous French cities, prices rose by 6.1%. Thus, attracting families to medium-sized cities did not lead to higher prices in the major regional cities, but rather slowed slightly in the rise.attached to the real estate laboratory.

Kevin Brolin, responsible for the service studies, sees new apartment prices rising as a result “Supply difficulties” In raw materials used in construction, “High prices of materials and energy” Based on ” Application “ New environmental standard, document reports. “The prices of materials used in construction have increased by between 7 and 12% over the past year, With respect family folder Henri Bouzy Cazaux, president of the Institute of Real Estate Services Management (Imsi). Supply difficulties caused by the Covid-19 pandemic have been exacerbated by the war in Ukraine. »

New environmental regulations

Named RE2020, the new Environmental Regulations for New Buildings, resulting from the November 23, 2018 Law on Housing Development, Development and Digital Technology (Elan), came into effect on January 1, 2022.

“This new standard, the successor to the 2012 RT, is […] More virtue but also more expensiveFrank Feignud, director of the Real Estate Lab, explains in the study. The effects of its implementation on new home prices are not yet entirely clear; It will begin to be felt during the 2022 semester, when the authorized operations will be commercialized at the beginning of the year. »

New apartment construction has not regained its momentum before the health crisis due to the Covid-19 pandemic. “Licensing is struggling and the level of start-up housing has stagnated for 11 months; everything contributes to maintaining a limited supply of new apartments in the real estate market, which is putting pressure on prices”notes the real estate lab.

Protection of the individual housing construction contract

With regard to homes, the The number of permits authorized […] approaching its highest levels in the early 2010s”. The sudden rise in demand for homes is the fallout from the COVID-19 pandemic and foreclosure.

“Individual home building contracts governed by the law of December 19, 1990 require delivery at the agreed price, generally eight to twelve months after signing.”says Henri Bouzy Cazaux. A well-capitalized company is absorbing the increase in costs, but this erodes its margins. But among the small businesses, which make up the bulk of the home builder’s players, not many will hold up. » For consumer buyers, these contracts “virtuous” Offer protection, various insurances that allow delivery in most cases.

Land prices range from 35% to 60% of the total construction cost

According to Henri Buzy-Cassaaux, the new government should mitigate the impact of inflation on the construction industry, by lowering the value-added tax (VAT). “The rate applied to new construction is in principle 20%”recalls the head of Imsi. “It will also be necessary to ensure low land prices, in particular by temporarily adjusting the mechanism for capital gains taxation, which will encourage owners to hold their land for as long as possible.” According to our interlocutor, land prices can account for between 35% of the total cost of construction in non-stressed areas and 60% in stressed areas.

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