The world's leading real estate show places housing and the city at the heart of its new edition

"We are going to return to the subject of housing. We have been dealing with this issue for two years now, and with increasing interest," Nicolas Kozubek, director of the International Market for Real Estate Professionals (Mipim), explained to AFP.

A gathering traditionally attended by investors, developers, planners and property managers, Mipim will begin on Monday with a pre-opening day dedicated to housing.

Economic and public stakeholders, including the mayors of London and Hanover, will discuss the challenges of making housing more affordable and adapting supply to demographic needs.

By 2023, one in ten European city dwellers spent more than 40% of their disposable income on housing, according to European Union data.

And between 2015 and 2023, house prices increased by an average of 48% across the European Union. They even doubled, or more, in five countries, including Portugal.

The EU points out as the main reasons "the increase in construction costs and interest rates, the decline in construction, which has limited supply, and the increase in property acquisitions aimed at investment and generating additional income."

To discuss these topics, Nicolas Kozubek is delighted with the "somewhat exceptional" presence of "several mayors of major European capitals": Sadiq Khan from London, Jose Luis Martinez Almeida from Madrid, Roberto Gualtieri from Rome, Lars Weiss from Copenhagen and Haris Doukas from Athens.

He wishes to respond to the "desires of elected officials to discuss among themselves and with investors and other stakeholders" the issues of "urban development, rethinking the city, accommodating a growing population...".

A "summit of political leaders" will bring them together on Tuesday, in a restricted committee.

"Historically, there has been a greater appetite for other asset classes than housing among investors, but the situation has changed a little, with the attractiveness of other types of property, particularly offices, being called into question" since Covid and the widespread adoption of teleworking, underlines Nicolas Kozubek.

"Absolute necessity"

For Florence Semelin, director of the residential department of the real estate consultancy JLL, "residential is taking an increasingly important part in investors' overall portfolios."

She confirms that "before, it was offices, but today there is a rebalancing, we are talking more and more about housing and that is really good (...) given the absolute necessity of individuals to have housing".

On the French side, Mipim is organizing a third edition of its elected officials' forum on Wednesday, in which 80 elected officials and representatives of French communities will participate.

Across all sectors, the real estate context "remains very particular, as has been the case since the end of Covid", recalls Nicolas Kozubek, with a complicated macroeconomic situation and an unstable geopolitical situation.

The conflict in Ukraine had started to push up construction costs in 2022, then the rise in interest rates has increased borrowing costs and undermined the profitability of many projects.

The European construction sector has had a "disastrous year" in 2024, weakened by high interest rates coupled with inflation, according to a report by consultancy Bain & Company, which highlighted in January that residential construction suffered the most.

Political uncertainties, particularly in France and Germany, have left real estate professionals on the fence.

"The situation is delicate, but tomorrow when it has passed, the technological, environmental and societal issues will be central," underlines the director of Mipim, where numerous conferences on artificial intelligence and carbon neutrality will also take place.

Former European Central Bank President and former Italian Prime Minister Mario Draghi will discuss his report on the future of European competitiveness in his opening speech at the fair on Tuesday.