As Brexit fast approaches, Paris is enjoying a rise in property prices amid uncertainty in London’s prime property market and the UK market in general. A couple of weeks ago I wrote about the dip in demand for luxury property in London and suggested that only those investors that can hold their nerve for the long-term and buy property in bulk at discounts might do well in London right now. In light of this, it seems that many who would normally look to buy in London are turning to Paris instead.
An article in the Financial Times yesterday said that Home Hunts, which finds French properties for wealthy international buyers, received more than double the number of enquiries from UK buyers in the first six months of 2018 than in the first six months of 2017. This rise in interest seems to be due to a range of reasons:
International investors are looking for a secure market for their money.
For investors, Paris has always been a popular choice but in the two years since the vote to leave the EU, prime property prices in Paris have risen by 17.5% – a significant amount.
Wealthy French expatriates want to move back to Paris.
For wealthy French expatriates domiciled in London, it seems many are considering repatriating to Paris after leaving France in 2012 to escape Francois Hollande’s tax hikes.
London’s financial institutions are relocating or opening offices in Paris to safeguard against Brexit.
Since the UK voted to leave the EU, many of the investment banks based in London have announced that they are moving staff to Paris or are planning to open a European subsidiary. According to PwC there are around 2,000 high-paying financial jobs moving from London to Paris or being newly created in Paris as a result of Brexit. French authorities have also offered tax breaks to high-income Londoner’s as an incentive to move to Paris. According to PwC a UK expat in France with an annual income of €1m could take home €180,000 more than they would in the UK. You may also have seen the advertising campaign launched by Paris’ financial district bearing the slogan “Tired of the fog? Try from frogs! Choose Paris La Defense”.
According to the director general of the French public body that manages the French financial district the campaign aimed to roll out “the blue, white and red carpet for thousands of professionals now seeking new European headquarters.”
Before the referendum, 85% of European-based hedge funds were based in London, in a few years’ time it will be interesting to see by how much this has changed. With Brexit on the horizon and Macron’s pro-business policies appearing to work, it looks as though Paris is likely to keep growing as a rival for London’s prime property market. Watch this space…
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