a map.  Stunning drop in new home sales by region

a map. Stunning drop in new home sales by region

Single house builders are no longer celebrating. During the first four months of 2022, their sales were already down more than 25% on average compared to the same quarter in 2021, according to the French Construction Federation (FFB). The reasons for these bad numbers are manifold. cmists (the simplified name of builders of individual houses) already accumulate various difficulties that burden their activity.

First of all, the FFB reports that the decline in sales at the beginning of the year “may” have been explained [sic] By implementing a new environmental building standard, called RE2020, since January 1, 2022. However, these increased requirements for builders could increase the price of housing by at least 5%, the union estimates. An additional cost that rushed buyers had been expecting at the end of last year, which halted sales at the start of the year. “When a reform that generates additional costs is implemented, it is logical that there is a surplus in sales immediately before its implementation,” suggests Olivier Saleron, president of the union. This thesis is also confirmed by the increase in building permits for new homes (+21.2% between the first four months of 2021 and 2022), “under the influence of the processing of massive permit applications in December 2021,” notes the FFB.

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Then, new homebuilders can only see rising rates that have made it difficult to get mortgages since the beginning of the year. This unfortunately has the effect of removing a portion of their clients. Credit rates are rising, and so are home prices. Inevitably, this slows down some buyers of the wings,” Olivier Saleron commented. Thus, the price increase is fueled by the implementation of RE2020 … but also by the staggering rise in material prices that has accelerated since the outbreak of the war in Ukraine.

And the final problem raised by its union: that of the Zero Net Industrialization (ZAN) policy, whose law passed in 2018 aims to halve the land surface consumed by urbanization compared to the previous decade. “Sometimes, I find that ZAN is applied in an extreme way in certain areas,” complains Olivier Saleron. A restriction that, locally, would complicate access to construction land for the construction of new homes.

Spectacular waterfalls in Normandy, Brittany and Hauts-de-France

If we now go into detail from one region to another, it is clear that we notice that the sales decline is not uniform everywhere. As a reminder, the FFB made comparisons of sales between the first quarter of 2022 (early January – end of April) and the first quarter of 2021. In this way, sales in the PACA region and Corsica decreased by “only” 10.8% between the two periods … while the decline was 38.5% in Normandy. Moreover, neighboring regions in the Northwest are also experiencing a sharp decline in sales: -31.4% in Hauts-de-France and -31% in Normandy. Discover all sales trends on our map below.

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