Foreigners are fueling the luxury real estate boom in France, with British buyers leading the way over the past year, according to a report Wednesday from international brokerage Knight Frank.
"Against a positive economic and political backdrop, France is now experiencing a buoyant and incredibly exciting residential market rebound," wrote Mark Harvey, head of European sales at Knight Frank.
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"International buyers continue to be the driving force of prime residential sales," he added.
U.K. buyers account for around one in four prime residential purchases in France, according to the London-based brokerage. Other major nationalities include domestic French buyers and foreigners from Northern Europe, including Belgium and Luxembourg, Switzerland and Scandinavia. There’s also been an uptick in Middle Eastern and U.S. buyers in the country, according to the report.
The real estate industry has largely credited the positive economic effect of President Emmanuel Macron, a young investment banker who assumed the office in May.
Prime prices in Paris soared 12% in 2017, a resurgence that has spilled over into other luxury regions and second-home markets in France. The sunny Côte d’Azur, Provence, cities in the Alps and Southwest France are experiencing a turnaround in inquiries and transactions, according to the report.
Prime prices hovered around €16,000 to€118,000 (US$19,789 to US$22,262) per square meter in Paris in the first quarter of 2018.
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The mountain peak Alpine resort of Courchevel 1850 had some of the most expensive prime prices in the country, ranging from €23,000 to €27,000 (US$28,447 to US$33,394) per square meter, according to Knight Frank.
Alpine buyers there are mainly after new development, as off-plan sales account for around 80% of activity in Knight Frank’s Alpine network, the brokerage said.
"Against a backdrop of historically low interest rates, rising house-price inflation, growing economic and political stability," Mr. Harvey wrote, "France looks to attract global wealth that will allow its real estate markets to thrive through 2018."