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Luxury real estate : Paris vs. New York vs. London


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Being wealthy is good, living in the most attractive city is even better. Paris, New York or London? What is the best city for great fortunes? Nestoria addresses this issue. …

Being wealthy is good, living in the most attractive city is even better. Paris, New York or London? What is the best city for great fortunes? Nestoria addresses this issue.

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  • 1. Paris, November 22nd, 2011Luxury Real Estate: Is Paris the most attractive city for large fortunes vs. New York or London?Being wealthy is good, living in the most attractive city is even better.Paris, NewYork or London? What is the best city for great fortunes? Nestoria addresses thisissue.After the financial crisis (and a decrease from7% to 12% in price), high-end real estate has takenoff in 2010 (a 20% increase in Paris between January 2010 to January 2011) to reach a newrhythm in 2011 (+5% increase since the beginning of the year).The reason? Massive foreign investment.According to the two most important agencies in realestate Barnes etFéau, prices should stabilize.Paris: a sure investment for a diverse international clientele.Paris offers a variety of housing that definitely attracts of large number of buyers. There are threetypes of markets: 1- Family apartments in the prestigious areas of Paris (an average of 10 000 €/m²). 2- Famous “haussmanien” apartments with hardwood floors, moldings, and fireplaces (an average of 15 000 €/m²). 3- The exceptional property with an average price of 25 000 €/m² and prices acan even exceed 50 000 €/m² (for example, a 7 room apartment with a surface of 350 m² with a price that is above 34 000 €/m²luxuryapartment paris).Prices tend to increase with the arrival of wealthy foreign investors. Whether they be SouthAmerican, Chinese or Italian (in the Marais, nearly1 buyer out of 2 is Italian according to theChambre des Notaires de Paris). Wealthy foreign investors consider Parisian real estate as thesafest of investments.The main reason is that the construction of new buildings with high standing is rarely possible.Paris retains its appeal: the housing is expensive but very well located, in fact, that is what theBeckham couple seems to be looking for (David Beckham will shortly be joining the PSG).The desire of this star couple, a triplex in a beautiful Parisian building, shows us the type of goodsthat this wealthy clientele is looking for: an apartment “à la Parisienne”.This type of exceptional accommodation is of course very expensive and over one million Euros(between 3 and 5).If they choose to move to atypical apartments or private houses, it willdefinitely be over 5 million Euros.(for example, an apartement in Paris quai de Béthune Paris 4ewith a surface of 333m² is priced at 9 000 000 € : luxuryapartment in Paris).The only obstacle to wealthy Hollywood stars or big fortunes in the French capital is: French taxwhich is rather heavy and complicated for people residing in several countries (see JohnnyDepp’s interview on Europe 1 on November 9th, 2011).
  • 2. Share (%) acquisition of apartments made by foreigners in Paris in 2010. Distribution of foreign buyers in 2010Distribution of foreign buyers in 2010 and their nationality
  • 3. What about London and New York? Is the investment worth it?The French capital is closely followed by London with average prices ranging from 14 000 €/m²(Chelsea) to 14 000 €/m² (Knightsbridge).London therefore offers prices that are about 20% more expensive than Paris, but despite thisgap, London is currently a great deal because prices are usually twice as high than in Paris.Thedecline in the Euro and the overall atmosphere with the crisis has had its effect.The luxury real estate is still attractive with an average price of 5.7 million Euros for the largehomes in Kensington, Chelsea, or Knightsbridge.To an equivalent scale, New York offers much cheaper prices (average low of 12 000 €/m² andeven 7 000 €/m² in the East Side)although the gap is reduced this year compared to 2010 due toa lower dollar currency rate (1.5 vs. 1.36 in 2010). Today, it will cost on average 560 000 € for astudio with a surface of 45 m² and 1 million € for a 2 room apartment. Average price per m² for cities Paris, London, and New York in 2011
  • 4. In conclusionParis is still the safestcity for long term investment regardless of currency fluctuations. Londoncan emerge as an alternative but less so in the aim of surplus value. If the objective is to achievethe best deal, then New York is undoubtedly the best choice even if the city does not have thesame charm as Paris.Source :Chambre des Notaires de ParisTags :luxury real estate, prestige real estate, apartment in Paris, London real estate, New Yorkreal estateTo know more go toNestoria : Press release July 2011Luc HédinWebmarketing (0)1 83 62 54 15