Residential Investment: A 42% Decline in the First Half of the Year
With 1.2 billion euros invested between January and June, residential investment in France fell by 42% year-over-year, according to data released on July 16 by real estate consulting firm Cushman & Wakefield. The market is fragmenting into smaller transactions and is shifting heavily toward the Île-de-France region.
Six months, 1,217 million euros. The total for French residential investment in the first half of 2026 is far below the 2,087 million recorded in the first half of 2025, representing a 42% decline. What the transaction details reveal most clearly is a shift in the market’s landscape: activity is driven by a multitude of deals under 20 million euros, with 77 transactions totaling 606 million. Major deals are becoming rarer, even though six transactions exceeded 40 million euros, including one over 200 million. Geographic concentration reached a level rarely seen: the Île-de-France region accounted for 84% of national volumes, or 1,016 million euros. When expanded to include all asset classes, standard and residential investment totaled 7.97 billion euros for the half-year.
Traditional Residential Real Estate Shifts Toward Value-Add
Traditional and mid-market residential real estate totaled 851 million euros, down 34% from the 1,279 million euros recorded in the first half of 2025. The average transaction size of 12 million euros speaks volumes about investors’ shift in strategy: value-add assets—those requiring renovation and repositioning to create value—now account for 91% of transaction volumes. Secure-yield investments are giving way to the pursuit of capital appreciation through transformation. Social housing providers, with 296 million euros committed over the half-year, maintained their presence throughout the period, despite a post-election environment that might otherwise have prompted them to adopt a wait-and-see approach.
Managed residential real estate halved in value, while student housing holds steady in off-plan sales
Managed residential real estate, across all property types, closed the half-year at 367 million euros, compared to 808 million a year earlier. Student housing accounted for the bulk of this, with 272 million euros spread across 10 transactions, three-quarters of which were off-plan sales and one transaction exceeding 50 million. The segment nevertheless remains well below the 758 million recorded in the first half of 2025. Senior assisted living facilities and co-living continue to struggle, with a combined total of just over 95 million euros, including only three transactions and 29 million euros for senior residences alone.
Aymeric Sevestre, head of capital markets at Cushman & Wakefield France, offers a more nuanced view: “Transaction volumes in the first half of the year are down compared to last year, when several major deals in the managed and existing residential sectors had bolstered activity. Nevertheless, private investors remain active in the existing residential sector, as do operator-investors in the student housing segment. The market, however, continues to be constrained by a lack of properties for sale in the managed residential sector.” The question for the second half of the year remains: Will the lack of properties for sale outweigh investors’ renewed appetite?
