New housing: the war in the Middle East is still hindering the sector's recovery in the first quarter of 2026

While professionals were hoping for a gradual restart of the new real estate market thanks to recent government announcements, the international geopolitical context has abruptly cooled the momentum.

The war in the Middle East is weighing on the new housing market

"Housing had regained its place on the political agenda" with the announcements of a tax scheme and a housing bill, but the war in the Middle East has shattered any excitement among buyers, notes Didier Bellier-Ganière, general delegate of the FPI.

The conflict "increases tensions over the cost of energy, the cost of materials, inflation (...) and all these elements maintain and fuel a climate of anxiety" which "does not rhyme with the desire to buy and to house", he continues.

In this uncertain economic context, reservations for new housing registered by FPI members have fallen by 14% year-on-year, reaching only 19.050 homes in the first quarter of 2026, a historically low level for the real estate development sector.

Social housing providers are drastically reducing their purchases

Among the different categories of buyers, social housing providers have seen the sharpest decline. Reservations made by these providers have fallen by 35% year-on-year.

For several years, however, social housing organizations had been supporting property developers by buying more new housing in order to limit the effects of the housing crisis.

"Social landlords have played their part but they don't have unlimited equity," laments Pascal Boulanger, president of the FPI.

Individuals wishing to become homeowners have also reduced their purchases, with reservations down 18% compared to the first quarter of 2025.

Rental investment is experiencing a slight recovery thanks to the private landlord status.

The only positive point for the new real estate market: rental investment shows a rebound of more than 550 homes sold, representing a 23% increase over one year.

For Didier Bellier-Ganière, this increase could be linked "to an effect of the status of the private landlord", the new tax incentive scheme for rental investment put in place in February, even if its impact remains "difficult to quantify".

However, this improvement remains insufficient to compensate for the overall weakness in demand for new housing.

The figures for 2026 are even worse than those for 2025.

After three years of deep crisis in new construction, professionals in the sector were hoping for a gradual recovery in 2026. But the indicators at the beginning of the year are ultimately lower than those already deteriorated for 2025.

"It's getting worse and worse." The number of homes put up for sale and reservations has "never been so low," laments Pascal Boulanger.

The only data pointing upwards concerns building permits, which jumped 33% in March compared to the previous month.

"We don't have a completely rational explanation," emphasizes the president of the FPI, for whom "this increase is atypical."

"There is always a good number of permits in the month of the municipal elections, but this one is much more important" than before, added Didier Bellier-Ganière.

Illustrative image of the article via Depositphotos.com.