The year 2019 was marked by a record number of real estate transactions in France. The first quarter of 2020 began on the same footing, and nothing seemed to slow the momentum.
While the economy was booming, the health crisis came along and shook up many sectors, including real estate. Under lockdown conditions, the entire real estate ecosystem is paralyzed. To address this, digital solutions exist, such as electronic signatures, virtual tours, video conference presentations…
However, these services are not yet widespread in the industry. Indeed, real estate transactions form a vast chain involving several parties: diagnostic experts, notaries, and public authorities.
This constrained context raises questions: How will the market react upon exiting the Coronavirus crisis? We asked Enis Sliti, CEO of Beemmo, a company located in Sophia-Antipolis.
The period we are experiencing is unprecedented and a source of concern both in our daily lives and in the European and French economies. Of course, confinement directly impacts economic functioning by limiting opportunities and encouraging remote work; however, we are primarily facing a health crisis, not an economic one.
If the confinement period were to extend beyond spring, the impact on the economic and financial world would inevitably be greater, as consumers and investors would likely turn towards safe havens like real estate investments, synonymous with stability.
The real estate market is subject to psychological factors where housing purchase plans are postponed due to a lack of visibility. We can therefore expect a price adjustment in the short and medium term, particularly for high-end real estate, but there will probably not be a price drop.
The market’s evolution will also depend on banks, which finance our clients’ real estate projects in 70% of cases. Currently, they continue their activities, but we are noticing an extension of the loan approval process timelines during this confinement period.
