Rental returns in Paris are disappointing
| Last Updated: Aug. 14, 2017 | |||||
| PARIS - Apartments | COST (€) | YIELD (p.a.) | PRICE/SQ.M. (€) | ||
| TO BUY | MONTHLY RENT | TO BUY | MONTHLY RENT | ||
| 1st District | n.a. | n.a. | 4.25% | 8,749 | 31.00 |
| 2nd District | n.a. | n.a. | 3.41% | 9,780 | 27.80 |
| 3rd District | n.a. | n.a. | 3.60% | 9,940 | 29.80 |
| 4th District | n.a. | n.a. | 3.31% | 10,891 | 30.00 |
| 5th District | n.a. | n.a. | 3.30% | 10,479 | 28.80 |
| 6th District | n.a. | n.a. | 2.79% | 12,796 | 29.70 |
| 7th District | n.a. | n.a. | 3.10% | 11,730 | 30.30 |
| 8th District | n.a. | n.a. | 3.13% | 10,533 | 27.50 |
| 9th District | n.a. | n.a. | 3.59% | 9,128 | 27.30 |
| 10th District | n.a. | n.a. | 3.74% | 8,048 | 25.10 |
| 11th District | n.a. | n.a. | 3.49% | 8,423 | 24.50 |
| 12th District | n.a. | n.a. | 3.93% | 7,994 | 26.20 |
| 13th District | n.a. | n.a. | 3.65% | 7,561 | 23.00 |
| 14th District | n.a. | n.a. | 3.31% | 8,893 | 24.50 |
| 15th District | n.a. | n.a. | 3.57% | 8,568 | 25.50 |
| 16th District | n.a. | n.a. | 2.87% | 10,228 | 24.50 |
| 17th District | n.a. | n.a. | 3.44% | 9,211 | 26.40 |
| 18th District | n.a. | n.a. | 3.62% | 8,193 | 24.70 |
| 19th District | n.a. | n.a. | 4.01% | 6,979 | 23.30 |
| 20th District | n.a. | n.a. | 3.66% | 7,021 | 21.40 |
| All yields are gross - i.e., before taxes, repair costs, ground rents, estate agents fees, and any other costs. Net yields (what you'll really earn) are typically around 1.5% to 2% lower. Source: Se Loger and Professor Michel Mouillart of CLAMEUR Definitions: Data FAQ See also: Update Schedule |
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The good news is that if you have an apartment in Paris you will have no trouble letting it. Demand outstrips supply, the main reason that rents are not higher being that French rental contracts are often long-term and there are legal restrictions on raising rents during the contract.
However gross rental yields from apartments in Paris are poor, at around 4.2% for small apartments and 3.9% for big apartments (however it is fair to say that our Paris yields results arguably may not reflect yields in less desirable locations, which are likely to be higher, because our sample focuses on Paris' high-end city centre).
The price of a 120 sq. m. apartment in these locations is around EUR 970 per sq. m., or EUR 90.1 per sq. ft. This year, we did not find a big price-difference between smaller and larger apartments.
The average monthly rent ranges from EUR 32 to EUR 35 per sq. m., or EUR 3.8 to EUR 3.25 per sq. ft. Smaller apartments tend to rent for proportionately more.
Round trip transaction costs are high on residential property in France. See our French residential property transaction costs analysis and our Transaction costs in France compared to other countries.
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