Housing minister says home prices set for drop

19th September 2006, Comments 0 comments

PARIS, Sept 19, 2006 (AFP) - French Housing Minister Jean-Louis Borloo forecast on Tuesday that the price of homes in France would fall significantly in the next two to three years because the supply of new homes was increasing.

PARIS, Sept 19, 2006 (AFP) - French Housing Minister Jean-Louis Borloo forecast on Tuesday that the price of homes in France would fall significantly in the next two to three years because the supply of new homes was increasing.

"There will be a marked fall in prices," he said on the sidelines of a meeting in the French parliament, adding that France would "return to a normal market".

A ministry document on the housing market said that an increase in home construction was beginning to cool the market by increasing the supply of available housing.

The report also stated that "sales prices are now falling and the rise in rental prices seen in 2006 is the weakest since 1999".

Figures from French real estate association FNAIM show that the sale prices of French housing increased by 10.0 percent in 2005 and by 15.5 percent in 2004.

At the end of July of this year, the increase over 12 months was 8.1 percent.

Copyright AFP

Subject: French news

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