Real estate developers very worried about the collapse in sales of new homes

“The situation is really serious,” said FPI President Pascal Boulanger at a press conference, “it continues to go badly and it is getting worse and worse in the figures”.

In the 1st quarter of 2022, sales of new homes collapsed. The decline observed in 2021 compared to 2019 (2020 not being representative) is accelerating. Total new home sales for the 1st quarter, compared to those for the same period in 2021, fell by more than 20%.

The number of homes put up for sale fell by some 30%, while apartment prices rose by 5,4% in one year.

Result: commercial supply continues its dramatic decline that began at the end of 2018. The stock of new homes for sale has fallen by a third since 2018 and now represents only 7,7 months of marketing, far from the ideal of 12 months . This is the lowest level since the creation of the Observatory (2012).

“From memory, since 2012 we have never had such bad figures”, assured Pascal Boulanger, explaining this gloom by three phenomena.

First "a huge absence of building permit signatures", the FPI judging the mayors more and more reluctant to issue authorizations.

Then "uncontrollable construction costs", the disruption of supply chains and then the surge in energy prices following the war in Ukraine having had a strong impact on the construction sector.

And finally the "wear rate" from which it is forbidden to grant a bank loan. With the rapid rise in interest rates, more and more mortgages are canceled because they exceed this rate, which is only updated every three months.

Pascal Boulanger said he asked the Banque de France and the Minister of the Economy Bruno Le Maire to switch to an update every month.

For Pascal Boulanger, President of FPI France: “Two years after the municipal elections, collective housing still does not obtain building permits in sufficient numbers to meet household needs. As a result, the increasingly glaring weakness of the commercial offer is leading an entire sector towards a major crisis. It is all the more regrettable that no political leader can question the ecological aggiornamento carried out by the profession, which is reflected in our achievements”.