House dream, a hard target as prices soaring in France

16:59, September 20, 2010      

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Laurent Takashu browses property announcements at a real estate agency as usual on his way home in Cercy Prefecture, northern suburbs in Paris. He has dreamed of owning his own house but so far he sees nothing affordable.

"Actually, I live in a small flat composed of three rooms. It's quite encumbered and my two kids cannot enjoy playing as there is not enough space," the worker of Paris-Charles de Gaulle airport told Xinhua.

The 41-year-old father had knocked the door of the Town Hall, hoping to find a big and cheap flat, but a long wait without answering chilled his expectations. He switched to private agencies. However, soaring prices make his dream to buy a house a hard target.

"I thought it's the better time to buy a house as the interest rate is negligible. I move one step forward and step back ten as prices are so high and I cannot pay housing loan. I have to choose either to stay close to Paris with high housing costs or in countryside where I can afford a house and both are bitter choices," he stressed.

France property prices have hit their highest-ever level with a 7.8-percent increase over the second quarter this year from a year earlier. Costs of Paris flats grew by 9.8 percent over the period with a record average cost of 6,680 euros (8,700 U.S. dollars) per square meter, according to figures published by Notary's Association of Paris.

The figures also show that 57 percent of the country's 65 million population own a house, far bellow the rate of France's neighbors where the rate rises to 70 percent.

With the aim to be on track of European level, President Nicolas Sarkozy promised when he came to power in 2007 to trim property interest rate to make French people homeowners.

The caretaker announced property loan with zero interest rate available to all without conditions of revenue, which will be implemented in 2011.

To Naima, a Moroccan charwoman who only agreed to be referred by the first name, the zero interest rate paved the way to realize her dream of buying a house after a long period of immigration in the European country.

"We, Muslim, we have to follow Charria Islamiya, the Islamic rules which prevent us to enjoy loans with interest rate. So, when I've been told about the zero rate I was relieved wondering that this measure will help me to reach finally what I've struggled for during many years," she said.

But, the outlook for the mother of three remains cloudy as offers go beyond her payment ability. She used to pay 350 euros for her flat in property-owned building and enjoys social help to pay the housing fees.

"Real estate market is recovering from the economic crisis and we expect to see housing prices rising for the whole year. There is a big demand which can not be satisfied by the available offers, that's why prices soar," said Frederick Renrault, a notary.

"With fiscal incentives and high rents of apartments, people look to have their own homes while property buyers are a little bit cautious and wait to see household's purchasing power stabilised and the shares of property growing more," he explained.

Francis Jeron, a 48-year-old skipper in a private company, made himself the exemplar to advise French people willing to own their property not to hesitate and take concrete move to take profit of the offered advantages.

"I've already bought a house with big garden and in a beautiful landscape with 135,000 euros and I have to pay 736 euros per month the same amount of money for a monthly rent of small flat in Paris suburbs," he said.

"It's true, the house is far 140 kilometers from Paris and that could cause some difficulties for my work but we can not have every thing as we want. Time is running and prices keep soaring so why shall I wait for other opportunities?"



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