© The Financial Times Ltd 2016
FT and 'Financial Times' are trademarks of The Financial Times Ltd.
The Financial Times and its journalists are subject to a self-regulation regime under the FT Editorial Code of Practice.
May 9, 2014 6:52 pm
The combination of a dynamic city and nearby classic French countryside may make the prospect of buying a home in Haute-Garonne sound potentially expensive. Yet this triangle of southwest France is distinctly unusual – it is, and has been for years, a buyer’s market.
Haute-Garonne measures 6,300 sq km – about the size of Devon – and runs to the Spanish border. For much of its length, it is dissected by the E80 motorway, which runs from urban Toulouse in the north, passing through gently rolling hills before entering the more dramatic scenery of the Pyrenees further south.
Toulouse dominates the local economy. Despite a well-preserved 17th-century quarter, two contemporary driving forces give the city its affluence. One is its cluster of aerospace, medical and scientific research centres, which attract international experts to well-paid employment; the other is its universities with a combined student roll of 120,000, about 10 per cent from overseas. Around the city and stretching south, the region becomes more agricultural with small villages of 10,000 or fewer residents.
Toulouse was described in 2006 as one of the world’s most dynamic cities by Newsweek magazine. Yet, the economic downturn has wreaked havoc within the city’s housing market.
Recovery may be taking effect in much of the world and even within parts of Paris, but it is still some distance away from Haute-Garonne. “Prime prices in southwest France have declined a further 10 per cent in the last year taking the fall from 2007 to approximately 40 per cent,” says Kate Everett-Allen of Knight Frank’s international research department.
Although there are more buyers this year than at any time since the downturn – including many from Britain and other EU countries – agents admit that the mood music is sombre.
“We’re now in the fifth, possibly sixth year where properties coming to the market outnumber those sold. We’ll need a number of extraordinary years simply to return to a normal market, which means prices will not be rising in the near future,” says Matthew Hodder-Williams, Knight Frank’s associate partner handling properties in southwest France.
He says Haute-Garonne has a two-tier market at present. “Tier one is where properties sell. Prices have either come down or new properties are at asking prices that reflect market conditions. In the second tier are houses either on the market for four to six years or sometimes longer and have not adjusted their prices.”
Le Capitole and Les Carmes are the areas of central Toulouse most popular with high-end international buyers, followed by the Busca, Saint Cyprien and Saint Michel quarters.
“Prices per sq metre in central Toulouse average €3,625. Investors are looking for prime apartments. There are some townhouses with gardens but it’s rare for these to come to market and they are snapped up by local French buyers,” says Nadia Jordan of Foothills of France, a local buying agency handling international clients.
In Les Carmes, a renovated mansion built in the 1840s, with 11 bedrooms and a large garden, is on sale with French Estate Agents at €1.89m. Head south of the city and prices fall. “It’s possible to find a large stone house with a big garden within an hour of the city for €500,000 to €600,000. Go further into the countryside and farmhouses and village homes are €400,000 to €500,000,” says Jordan.
“The [President] Hollande years have seen many high net worth French citizens sell, leading to a decrease in prices at the top end. This has attracted international money to the area. Haute-Garonne has witnessed a notable increase in demand from overseas,” says Alasdair Hedley of Hamptons International.
Local agents say so far this year there have been more Britons, Americans and Canadians seconded to aerospace firms in Toulouse, plus an increase in Australian and South African buyers seeking to retire in the area. For these higher-budget buyers, the most popular homes are larger maisons de maîtres and manoirs within driving distance of Toulouse.
One example near Bérat, a 45-minute drive southwest of Toulouse, is a six-bedroom, renovated country house with open-plan living areas, a gymnasium, terraces and a pool plus 74 acres of grounds, on sale with Savills for €1.26m. For those seeking an income, a renovated 16th-century, four-bedroom house, 40 minutes east of Toulouse, includes a 10-bedroom lettings complex, which Hamptons International is selling for €1.57m.
In view of the current climate, it is hard to believe the area saw annual price rises of five to 10 per cent between 2000 and 2007.
Despite the downturn, international transport links have survived intact. There are flights to Toulouse from across Europe, including several regional UK airports. The area is a six-to-eight-hour drive from Paris, but the government has promised that a new high-speed train service will cut the journey time between Toulouse and Paris to just three hours from 2020. What no one can promise, however, is a guaranteed improvement in the French economy.
Estate agents try to see the upside of this by pointing out that the highest new property taxes apply only to homes selling above €1.3m. This may be the reason why homes priced just below this figure have attracted greater interest this year than last.
“Given that prices have come down, it is an excellent time to buy,” says Knight Frank Hodder-Williams.
Yet one unanswered question is whether prices have reached the floor or will fall further before Haute-Garonne’s housing market recovers its joie de vivre.
● The Haute-Garonne has about 1.25m inhabitants, 40 per cent of whom live in Toulouse
● Toulouse has France’s highest-achieving business and international schools outside Paris
● More than half the population of the city is aged below 40
● Daytime temperatures regularly exceed 20C from May to September
What you can buy for . . .
€1m A six-bedroom, 15th-century château requiring modernisation
€1.5m A mid-19th-century house with eight bedrooms in Toulouse
€2m A manor house with 1,000 acres of mostly hunting land
Copyright The Financial Times Limited 2016. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.