The reality of the Riviera property market
- Tim Clark
Well what a year that was. As 2014 draws to a close I would like to reflect on how things have gone in the real estate business on the Côte d’Azur during these relatively tough times.
The year started quite positively with some excellent business levels across the board, however it quickly became clear that buyers were presented with so much to choose from that the hardest thing was getting them to stop looking and to make a decision on a particular property.
My colleagues and I are still in contact with dozens of potential buyers who still haven’t made a choice. It seems would-be house hunters are playing a waiting game, to see what happens with the French economy, French taxes, property prices and, of course, François Hollande!
Let’s look at these one by one: the economy can only get better, right? French taxes, well that’s an article in itself, but we’ve been promised no more tax increases before the 2017 general election, so that probably answers the Hollande question, too.
That leaves property prices. I run the risk of sounding like a stuck record but this is the one area where buyers will absolutely take care before making a decision. There’ll always be speculative buyers who try it on with a ridiculous offer, but they’re always outweighed by sensible buyers who are prepared to pay a fair price and are savvy enough to carry out some research to know what they should be paying in any given area.
Over the last few weeks I’ve heard agents telling vendors not to reduce their asking price because there aren’t any buyers; I’ve heard agents telling vendors the market is terrible and there are simply no enquiries; I’ve had vendors telling me they read somewhere the market was improving and prices were going up; and I’ve had buyers telling me they read somewhere that every vendor in France would accept offers 30% under their asking price.
I’d like to categorically state here and now, these are all untrue on most levels.
There are buying clients, but, as mentioned above, they are both informed on what they should pay and nervous about committing to the French market with its current economic uncertainty. So while tough, the property market is not as terrible as some would have you believe.
I’d add that it’s wishful thinking to believe the market is rising and prices are going up. This has not been the case for 18 months and it’s unlikely to change anytime soon.
And for buyers expecting to get 30% off an asking price, this is generally not the case either. Experience tells me that if you managed to negotiate 30% off the asking price, it was because the property was 25% overpriced in the first place.
So where does this leave us? The signs are good for an increase in transactions in 2015. Our recent property exhibition results brought us a record number of enquiries from genuine buyers in the UK, Paris and Brussels. Many of these buyers are currently planning early spring viewing trips.
If you’re selling, talk with your agent about the real market value of your home: if he or she is being honest it’s unlikely to be the figure you were expecting, but it will represent the current world-selling price. I’m not suggesting people give away their properties, but if you haven’t sold within a year, then one of the most obvious reasons will be price. Unless, of course, your agent lives in the dark ages and hasn’t heard of the internet.
Another point, don’t fall into the trap of taking your property off the market for winter and bringing it back in the late spring. You’ll have missed all of the buying clients who search at this time of year to plan early spring trips. And any buyers that come in January and February are serious about buying, not holidaymakers who fancy a day house-hunting.
If you’re buying, then by all means do your research. With such enormous choice, be clear on your expectations and requirements, be prepared to listen and trust your agent to know his/her portfolio, and understand that an agent is there to try and find you that dream home. So if a suggestion is made, run with it.
Most of all, it would be folly to say properties aren’t negotiable, but most vendors will try and price correctly for the market and a fair and sensible negotiation is always looked on more favourably by those who are serious about selling.