WITH growth in lending rates AND tightening of conditions for access to real estate loansis a self-financed rental investment still possible at the dawn of 2024?
That’s according to a study from Meilleurs Agents, a website specializing in online property valuations, which analyzed property prices in France’s 200 largest cities to identify the best buying opportunities.
Goal: invest in a 20m² studio with a contribution of less than €30,000. The selected cities are those where the investment is low-risk and whose average rental income covers all costs associated with the purchase and common fees (agency and notary fees, real estate tax, income tax, co-ownership fees…) as well as the monthly loan payment .
Limoges, Roubaix and Clermont-Ferrand on the podium
Limoges is at the top of the scale with a necessary contribution of €19,600 to make the purchase of a 20 m² studio profitable. A city with strong potential in terms of rents (€322 including fees for 20m²) and property prices (average €1,967 per m² for T1) which, despite the market entering a downward cycle, represents a development of +2.1% in one year and + 38.8% in five years.
Roubaix it also represents a self-financed investment opportunity through a contribution of EUR 22,208. With a price drop of -0.5% in one year, but +26% in five years, the price per m² of property in this city is €2,389.
Clermont-Ferrand is also a safe bet. The market is mainly driven by the share of students, which makes up 20% of its total population, and the attractiveness of its price per m², which has increased by +23.6% in five years. The contribution required to self-finance the property is €28,187.
Colmar, Besançon, Nancy: good students
The three cities are relatively well placed, despite the necessary contribution of €31,191 for Colmar, €31,912 for Besançon and €32,799 for Nancy, so that the rent covers the costs of buying the property and common fees or slightly more. than 50% of studio costs. The risk of non-rental and impairment is medium.
Saint-Martin-d’Hères: low risk of rental vacancy
Saint-Martin-d’Hères on the outskirts of Grenoble has property prices of €2,708 per m². The necessary contribution is EUR 31,090 (i.e. 51% of the property price). But the risk of not renting your property is low, students represent 86.2% of its population.
Dijon and Grenoble: more than €40,000 contributed
The city of Dijon is requesting a contribution of €42,835, or 61.1% of the property’s price. In Grenoble, the contribution to self-financing the purchase of a studio is EUR 46,904, i.e. 60.4%. The risk of not renting a property is lower in Dijon than in Grenoble.
Strasbourg, Lyon, Annecy: contribution from €69,500 to €96,500
If a contribution of €69,421 is needed to self-finance the purchase of a studio in Strasbourg (i.e. 68.5% of the price; €4,509 per m²), it is necessary to invest €83,011 in Lyon (69.7%; €5,302 per m² ) and €96,403 in Annecy (71.2%; €6,023 per m²)…
Mulhouse, Belfort, Saint-Étienne: low contribution but…
In Mulhouse, if the contribution required to self-finance the property is only €6,099 (i.e. 16.9% of the cost of the property), the share of students in the city is low and the risk of asset depreciation is the highest. among the 200 cities studied. Prices have fallen by 8% in 10 years.
Same case for Belfort, where the necessary contribution is €13,139 (33%), but the risk of loss of value is greater than elsewhere. Prices have not increased in 10 years.
In Saint-Étienne, the contribution is also lower than in other cities (€13,443, or 35.7% of the cost of a studio), but the risk of not renting it is significant. The risk of loss of value is moderate. Prices have increased by 40.4% in five years.