Real Estate: A Market Recovery That Stalls Halfway Through
With 955,000 expected sales in the existing-home market, stable prices, new-home sales at a low, and rents on the rise, the back-to-school conference hosted by SeLoger and Meilleurs Agents paints a picture of a market that is picking up steam but still operating below its potential. The energy crisis linked to the Middle East has derailed the expected improvement in credit conditions.
By the end of 2025, the indicators were turning green one after another: transactions were up sharply, prices were recovering, demand was strong, and interest rates had stabilized. 2026 was expected to confirm this trend. Nine months later, Thomas Lefebvre, chief science officer at SeLoger and Meilleurs Agents, summed up the situation in a single sentence: “The market continues to move, but below its potential.” The recovery is here. It is incomplete.
In the residential real estate market, both platforms project approximately 955,000 transactions by the end of 2026. This is a solid level, close to the market’s steady state, but one that shows no further growth after the rebound in 2025. Given the growth in the number of households, the market is still 50,000 to 70,000 sales short—less than 10% of the market—of returning to a normal pace. Prices are stable year-over-year nationwide; only rural areas continue to stand out, with a 3.1% increase year-over-year.
In the new-construction market, an equation that has become nearly impossible
The outlook is growing bleaker in the construction sector. Sales of new homes remain near historic lows: reservations for multi-unit housing have plateaued at between 15,000 and 16,000 per quarter, compared with nearly 30,000 before the pandemic. Two trends have converged: since 2020, construction costs have risen by nearly 25%, while households’ borrowing capacity—taking into account both income trends and changes in interest rates—has fallen by 7%. The supply of new homes remains insufficient, and nothing in the latest figures suggests a recovery is on the horizon.
Why has the recovery stalled? The answer can be summed up in two words: credit and confidence. As of the start of the 2026 school year, 20-year rates stood at around 3.65%, even though they had been expected to stabilize at lower levels just a few months earlier. The energy crisis linked to the conflict in the Middle East has halted the improvement in financing conditions, and consumer confidence remains low. Mortgage brokers are reporting slightly lower averages—3.43% at CAFPI in August and 3.50% at Vousfinancer in September for the same term—but all describe the same downward trend. The tangible result: a household can afford, on average, about 69 square meters in France—2 square meters less than a year ago and 11 less than in 2020. A child’s bedroom has vanished in six years.
“Despite strong headwinds, buyers are still out there and the market isn’t at a standstill,” insists Thomas Lefebvre. “But not all the fundamentals are in place yet: interest rates have started to rise again, and consumer confidence remains low.”
The Rental Market: A Collateral Victim
Those who cannot buy rent, and those who rent stay put. The rental market is bearing the brunt of the imbalances in the other two segments. In 2025, rents accelerated again, rising 2.6% year-over-year nationwide. In Paris, rental supply remains about 30% below its pre-COVID level. The insufficient supply keeps pressure on prices, which discourages people from moving, which in turn reduces the number of units coming back onto the market. Surveys by Le Bon Coin Immo published on the same day illustrate the extent of the phenomenon: 83.7% of real estate professionals report that tenants are staying in their homes longer for fear of not being able to find another one.
In the short term, credit is not expected to provide a boost, warn SeLoger and Meilleurs Agents—quite the contrary. The trajectory of mortgage rates will depend on two factors: the duration of the conflict in the Middle East and changes in market confidence in French debt. If debt tensions remain contained, a gradual easing could begin after the fall and bring rates back down to around 3.5% by the end of 2026. A prolonged conflict combined with a deterioration in confidence in France’s creditworthiness, however, would constitute a double shock, capable of pushing rates above 4%.
That leaves the political landscape. With the presidential election just a few months away, both platforms see 2027 as an opportunity to be a game-changer, one way or another: either to create the conditions for a more comprehensive and sustainable recovery, or to prolong the imbalances that are currently holding back the housing market. In the existing housing market, conditions remain strong. In the new-construction and rental sectors, however, the cracks run deeper, and the political calendar pushes their resolution to next year.
