The French real estate market is going through an unusual phase: after a rebound in sales of existing properties in 2025, projections for this year indicate a decline in transaction volumes. This apparent paradox can be explained by the combination of rising credit rates, weakened household morale, and fiscal changes that are reshuffling the cards between old and new properties.
Understanding these mechanisms helps avoid confusing a temporary rebound with a lasting trend. Here are the dynamics that are truly shaping the real estate market in France this year.
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New housing: construction starts are recovering from a historic low
Most analyses of the real estate market focus on prices and rates in the existing sector. However, the new segment remains a leading indicator of the sector’s health, as it reflects both developers’ confidence and local authorities’ ability to issue permits.
According to a business climate study by the BPCE Group, after four years of decline, the new housing market seems to be emerging from the rut, but from levels of construction and sales deemed exceptionally low. The first positive signals are concrete: a 16% increase in building permits and a 14% increase in construction starts by the end of April 2026, year-on-year.
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These figures should be interpreted with caution. A double-digit rebound from a historic low does not bring production back to a sufficient level to meet housing demand. Following real estate news on Exploractu helps contextualize this data over the months.
Volume of real estate transactions: why a relapse threatens after 2025
The year 2025 saw sales of existing properties rebound by about 11 to 12% according to professional sources. This recovery followed two years of severe contraction. Interpreting this rebound as a signal of a linear recovery would be a misinterpretation.
The FNAIM forecasts for 2026 a volume between 900,000 and 920,000 transactions, which is about a 5% decrease compared to 2025. The BPCE Group, on the other hand, projects around 1.026 million transactions in 2026 (a 5% decrease year-on-year), including 890,000 in the existing market, representing a 6% decline after the 13% increase recorded in 2025.
Two main factors explain this expected turnaround:
- The rise in mortgage rates weighs on households’ borrowing capacity, mechanically reducing the number of fundable projects.
- The deterioration of household morale, linked to political and economic uncertainties, slows down purchasing decisions even when financing remains accessible.
- The gap between sellers’ price expectations and buyers’ actual budgets extends selling times and causes some negotiations to fail.
The existing real estate market operates in fits and starts, not through a continuous trend. Each quarter can reverse the dynamics of the previous one depending on monetary policy announcements or political signals.
Real estate taxation 2026: what changes in the old-new arbitration
A tax modification that came into effect this year subtly alters the profitability calculation between purchasing existing properties and new ones. The transfer tax regime (commonly referred to as notary fees) has been adjusted, with a temporary increase in the departmental transfer tax rate raised to 5% instead of 4.5% in most departments.
This 0.5-point increase represents an additional cost of several thousand euros on an average transaction. For a high-priced property, the difference becomes significant and may steer some buyers towards new properties, where notary fees remain lower (around 2 to 3% of the price).
Capital gains tax: the holding period threshold
The exemption regime for capital gains on primary residences remains unchanged. However, for secondary residences and rental investments, the holding period required for full exemption remains long, which penalizes quick resale strategies.
Investors who were counting on a short appreciation cycle must factor this tax constraint into their return projections. The exit cost absorbs a substantial part of the gross capital gain in the early years.
Mortgage rates and financing conditions: the window is closing
After the relaxation observed at the end of 2024 and the beginning of 2025, mortgage rates have begun a gradual rise. This trajectory reflects tensions in the European bond markets and uncertainties related to the French budgetary context.
The direct consequence is measured on purchasing capacity. For the same monthly income, a half-point increase in rates reduces the amount that can be borrowed by several tens of thousands of euros over 20 or 25 years. First-time buyers, whose personal contribution is often limited, are the first affected.
Price indices and geographical disparities
The price indices published by notaries show very contrasting developments depending on the territories. Major metropolitan areas are experiencing relative price stability, or even slight corrections. Attractive medium-sized cities continue to see their prices hold firm, driven by remote work and the search for quality of life.
Rural areas and small towns with poor connectivity are recording the most significant declines, with selling times noticeably lengthening. This polarization of the real estate market in France creates very different realities from one department to another.
- Paris and its inner suburbs: stable prices with sales volumes still down compared to the long-term average.
- Regional metropolises (Lyon, Bordeaux, Nantes, Toulouse): slight price correction, transactional activity fluctuating.
- Atlantic and Mediterranean coasts: sustained demand in the quality secondary residence segment, persistent price pressure.
- Rural areas far from employment hubs: excess supply, high negotiation margins for buyers.
Reading the trends in the real estate market this year requires local reasoning. National averages mask cyclical disparities that range from simple to triple depending on the territories. A buyer or seller relying solely on national indices risks miscalculating their project.