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Aug 14, 2017

Rental returns in Paris are disappointing


Last Updated: Aug. 14, 2017
PARIS - Apartments COST (€) YIELD (p.a.) PRICE/SQ.M. (€)
TO BUY MONTHLY RENT TO BUY MONTHLY RENT
1st District n.a. n.a. 4.25% 8,749 31.00
2nd District n.a. n.a. 3.41% 9,780 27.80
3rd District n.a. n.a. 3.60% 9,940 29.80
4th District n.a. n.a. 3.31% 10,891 30.00
5th District n.a. n.a. 3.30% 10,479 28.80
6th District n.a. n.a. 2.79% 12,796 29.70
7th District n.a. n.a. 3.10% 11,730 30.30
8th District n.a. n.a. 3.13% 10,533 27.50
9th District n.a. n.a. 3.59% 9,128 27.30
10th District n.a. n.a. 3.74% 8,048 25.10
11th District n.a. n.a. 3.49% 8,423 24.50
12th District n.a. n.a. 3.93% 7,994 26.20
13th District n.a. n.a. 3.65% 7,561 23.00
14th District n.a. n.a. 3.31% 8,893 24.50
15th District n.a. n.a. 3.57% 8,568 25.50
16th District n.a. n.a. 2.87% 10,228 24.50
17th District n.a. n.a. 3.44% 9,211 26.40
18th District n.a. n.a. 3.62% 8,193 24.70
19th District n.a. n.a. 4.01% 6,979 23.30
20th District n.a. n.a. 3.66% 7,021 21.40
All yields are gross - i.e., before taxes, repair costs, ground rents, estate agents fees, and any other costs. Net yields (what you´ll really earn) are typically around 1.5% to 2% lower.
Source: Se Loger and Professor Michel Mouillart of CLAMEUR Definitions: Data FAQ See also: Update Schedule

The good news is that if you have an apartment in Paris you will have no trouble letting it. Demand outstrips supply, the main reason that rents are not higher being that French rental contracts are often long-term and there are legal restrictions on raising rents during the contract.

However gross rental yields from apartments in Paris are poor, at around 4.2% for small apartments and 3.9% for big apartments (however it is fair to say that our Paris yields results arguably may not reflect yields in less desirable locations, which are likely to be higher, because our sample focuses on Paris´ high-end city centre).

The price of a 120 sq. m. apartment in these locations is around EUR 970 per sq. m., or EUR 90.1 per sq. ft. This year, we did not find a big price-difference between smaller and larger apartments.

The average monthly rent ranges from EUR 32 to EUR 35 per sq. m., or EUR 3.8 to EUR 3.25 per sq. ft. Smaller apartments tend to rent for proportionately more.

Round trip transaction costs are high on residential property in France. See our French residential property transaction costs analysis and our Transaction costs in France compared to other countries.






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