The French real estate market has been undergoing a correction phase since 2023 after several years of nearly uninterrupted growth. A decline in transactions, rising credit rates, and stricter energy requirements: the parameters to consider in a real estate project in 2024 are no longer the same as they were three years ago. Understanding these changes allows for calibrating a purchase or rental investment on realistic bases.
EPC and rental ban timeline: the criterion that buyers underestimate
The energy performance diagnosis is no longer an ancillary document slipped into a sales file. It now conditions the very possibility of renting a property. Properties classified as G can no longer be rented out since January 1, 2025, and class F will follow in 2028, then class E in 2034.
For a rental investor, this trajectory requires calculations from the acquisition phase. Buying a property classified as F or G at a reduced price may seem attractive, but the energy renovation budget must be included in the initial financing plan. Without renovations, the property becomes unlettable within a known timeframe.
Rental investment projects benefit from being analyzed from the perspective of real estate on Gone Magazine, which regularly discusses market dynamics at the regional level.
The Le Meur law, applicable since November 21, 2024, adds a specific constraint for furnished tourist rentals. In the affected municipalities, a new change of use authorization may require an EPC between A and E. A property intended for seasonal rental is therefore not chosen based on the same criteria as a traditional rental investment.
Old or new in 2024: two markets with opposing dynamics
The gap between the old and new property markets has widened during 2024. The gradual easing of credit rates has primarily supported transactions in the old market, where prices had begun to correct.
The new market remains penalized by several simultaneous factors: a decline in building permits, difficulties in marketing by developers, and changes in public aid schemes. A construction project cannot be reasoned with the same assumptions as a purchase in the old market.
In the old market, the price drop observed in certain metropolitan areas offers negotiation margins that did not exist two years earlier. However, the energy state of the property weighs on resale value and rental capacity, which brings us back to the EPC as a selection filter.
Rising acquisition costs: a often overlooked item
The overall cost of a purchase is not limited to the displayed price and the credit rate. Since April 2025, most departments have temporarily raised the departmental rate of transfer taxes from 4.5% to 5%. On a purchase of several hundred thousand euros, this additional half-point represents a concrete extra cost to budget for.
This increase is presented as temporary, but field reports diverge on this point. Several observers believe that the measure could be extended beyond the initial deadline. Including it in an acquisition budget remains prudent.
Mortgage rates: reading the trend without overinterpreting
After the rapid rise in rates between 2022 and 2023 (from about 1% to nearly 5% for certain durations), a relaxation began in 2024. This gradual decrease has given households a bit more borrowing capacity, but it has not brought financing conditions back to pre-2022 levels.
Several points deserve attention before setting up a loan application:
- The nominal rate does not reflect the total cost of the credit. Borrower insurance, guarantee fees, and application fees can represent a significant part of the overall cost over the duration of the loan.
- The granting conditions remain framed by the recommendations of the HCSF, which caps the debt ratio at 35% of net income and the duration at 25 years (27 years for new builds with a deferral).
- A personal contribution remains a determining negotiation lever with banks, which remain selective regarding borrower profiles.
The borrowing capacity depends as much on the buyer’s profile as on the displayed rate. Two households with the same income but different levels of contribution will not obtain the same conditions.
Thermal sieves: buying opportunity or financial trap
Properties classified as F and G are negotiated at a discount compared to better-rated properties. This discount attracts buyers hoping to renovate and enhance the property. The strategy can work, but it relies on several difficult-to-control variables.
The cost of energy renovation work depends on the existing structure (insulation, heating system, ventilation, joinery). A comprehensive renovation project often exceeds initial estimates, especially in older properties where hidden issues may arise during the work.
Financial aids (MaPrimeRénov’, energy savings certificates) help reduce the bill, but eligibility conditions and amounts change regularly. A financing plan finalized based on aids in effect at a given moment may become unbalanced if the scales change between signing and the start of work.
- Check the EPC class of the property and the necessary work to reach at least class E before 2034
- Estimate the work with a professional before the purchase offer, not after
- Identify available aids at the time of purchase and plan for a margin in case of changes to the schemes
- Anticipate the duration of the work, which impacts the rental and thus the yield
The real estate market in 2024 rewards buyers who integrate regulatory constraints from the search for the property, not after the signing. The EPC, transfer taxes, credit conditions, and the rental ban timeline form a set of interdependent parameters. Neglecting any of them exposes one to extra costs or an unlettable property.
