Wealthy investors see lasting life changes after Covid-19

This was the headline to a research paper published by UBS this summer. Trevort Leggett looks at the likely impact on French real estate. 

The report, issued by UBS Global Wealth Management helps us understand how the needs of buyers have shifted dramatically and gives an insight as to what is in store for the French prestige property market in 2021. Three quarters of those polled said that they anticipate permanent lifestyle shifts and, of course, property is central to how this change will be implemented. 

More than 3,750 investors, across the globe, were quizzed on how they plan to adjust their lifestyle after the pandemic. Let's take a look at three of the main findings: 

Seven in ten will reduce travel and trips to the office

Leggett were taking around 23,000 enquiries every month over the summer, from both domestic and international buyers. It was noticeable that, no matter which country the enquiry came from, an increasing number of clients are looking for properties with plenty of outside space and also with the ability to work from home.  This means a separate home office and excellent broadband connection. France has a dedicated broadband plan; France Très Haut Debit, where the Government has committed to providing fast (minimum 30mb) broadband for all by 2022 and fibre optic by 2025.  

Research from BNP Paribas, undertaken this summer, also confirms that buyers are now placing greater importance on both better digital connection and a dedicated room for work. With homeworking being recommended by many Governments this is a trend that is likely to grow.

Half intend to move closer to family

Travel restrictions and "lockdown" has brought home how important it is to be close to family. For those clients fortunate enough to be looking at the top end of the market, this means an increase in demand for country estates with more than one property in the grounds. What better way to ensure the safety of your particular family "bubble" than to trade two or three urban properties for a rural estate, with plenty of room and little exposure to potential threats. Once again, the BNP Paribas research backs up the UBS findings - they tell us that 81% of people looking to move, now attach more importance to outdoor space. As proof, Leggett enquiries for chateaux and country estates have increased exponentially since the start of the pandemic.

Forty-six percent may forsake cities for less populated areas

That's quite a population shift, even if the majority don't actually go through with it. We are still seeing high demand in Paris, Nice, Bordeaux and other cities but apartments with a balcony or some kind of outside space are fetching a premium. For those looking to move, then there is plenty of stock to choose from, at highly competitive prices. The beauty of the rural French real estate market is that prices have not risen in step with those in our cities. The Leggett office in Paris is on the Île St Louis (4th arrondissement) and you can expect to pay between 13,500-17,000 euros per m2 for an apartment on the island. Compare this to 2,552 euros per m2 in Nouvelle Aquitaine or 3,606 euros per m2 in PACA and you can see the attraction of a second home in the country*.

Please don't think that this is purely a French phenomenon. The Royal Institute of Chartered Surveyors recently reported that the price of homes with gardens in the UK is at a four year high. Their chief economist was quoted as saying "The results provide a further pointer to the substantive changes taking place in household behaviour in the wake of the pandemic". Watch this space!

 *average prices supplied by SeLoger