French people's favorite investment, will real estate recover from the unprecedented shock caused by the coronavirus crisis? Will the market rebound or sink into the doldrums? Will prices, whose curve has soared in recent years, resist or plummet? All these questions haunt 120,000 professionals, many of whom are unemployed, but also individuals who planned to sell or buy housing in 2020.
Since the confinement came into effect on March 17, a leaden screed has beenfall the area. After a record number of one million transactions last year boosted by credit rates at the lowest, and a start to the year 2020 set off on a roll, "the machine has suddenly paused", summarize the Notaries of France. Real estate agencies lowered the curtain and the number of promises to sell, normally plentiful in the spring, plummeted by 75%.
In March and April, “120,000 transactions were not made,” points out Thomas Lefebvre of Best Agents. Worse, the closure of notary offices has blocked 100,000 ongoing sales forcing agencies to temporarily cross over 400 million euros in fees. If activity does not resume by the end of May, 3,000 agencies could shut down, putting 20,000 workers out of work, alerted the National Real Estate Federation (FNAIM).
Real estate projects that last?
Paralyzed, will the real estate market restart after May 11? “The good news, assures Thomas Lefebvre, is that, for sales or purchases made before the crisis, there were few retractions. "At the end of confinement, we will have to catch up with a traffic jam to be expected among notaries, banks responsible for transferring funds, movers ..." Half of the people who had a real estate project before the crisis will relaunch it, believes Thomas Lefebvre. The French continue to see stone as a safe haven. "
The figures already show a thrill. "On the consultation of our announcements, we were - 40% at the beginning of the confinement, we are now only - 15%", confides Yann Jéhanno, president of Laforêt. "We have encouraging signals," says Christine Fumagalli, head of the 1,300 Orpi branches. 70% of buyers and 83% of sellers will resume their project at the end of confinement. "
"The market was slow, it is restarting with requests for visits from May 11," observes, too, Corinne Jolly. "There will be a recovery, says the owner of PAP.fr, because real estate is linked to life events, a birth, a divorce ... But this recovery will be gradual," she says. In the short term, the real concern is not about prices, but whether people will be able to borrow. And it is not possible when you are part-time unemployed and, tomorrow, perhaps unemployed. "
Access to credit that will harden?
A prolonged confinement, a lasting recession, unemployment which is starting to shoot up again… and the recovery will be killed in the bud with, in the event of a lasting recession, the specter of a property crash? We are not there. "In this period of economic and employment uncertainty, the banks will be cautious, but I don't think they will turn off the credit tap," says Thomas Lefebvre. If this were the case, "we risk losing some of the first-time buyers who were a very important clientele before the crisis," warns the president of Orpi, who is calling for more aid for home ownership.
So, between rebound and descent into hell, the list of unknowns is too long to predict the scenario which will prevail. One thing is certain: after two months of confinement, the real estate agencies are rather depressed. Questioned by the certification body Opinion System, half feared for their future and the maintenance of employment (53%), a fall in prices (45%), a fall in the confidence of sellers and buyers (46% ) and, above all, 70% fear a tightening of access to credit, a key factor in the rebound in real estate. Not sure that the coming weeks and months will cheer them up.
