As the Paris Olympics approach, a fascinating trend has emerged in the city’s real estate market: rental prices for high-end apartments are falling significantly. This unexpected development is creating opportunities for late planners looking to experience the games without breaking the bank. Here’s a closer look at what’s happening and why.
Unexpected price drops as supply outstrips demand
The construction of seating and other infrastructure for the Paris Olympic Games is well underway, with only 88 days remaining until the opening ceremony. Surprisingly, homeowners looking to cash in on the influx of tourists are finding that their expectations may have been too high. Due to an oversupply of available rentals, particularly fancy apartments, prices have dropped by a staggering 30% to 60%. This creates an excellent opportunity for those who wish to rent a luxury apartment in Paris for a short term.
Euronews reported that in February, while rental prices were elevated, they had not reached the astronomical levels predicted earlier. A surge in Airbnb listings contributed to this saturation, making it harder for homeowners to demand premium rates. The French Tourism Office noted that last September, the average price for a night’s stay in Greater Paris was €759, but by February, this figure had dropped to €522 for comparable properties.
By April, the downward trend persisted. As reported by a major insurance firm, typical nightly rates stood at €436 compared to the previous summer’s peak of €1020. With new listings continually being added—up to 3500 each month—the competition among property owners remains fierce.
Sports federations’ influence on the market
A significant dynamic affecting the rental landscape is the role of sports federations. These organisations pre-booked a substantial number of rentals through agreements with the Olympic organisers. As their plans became clearer by late January, many of these reserved accommodations were released back onto the market.
Real estate agents report mixed results when advising clients looking to rent out luxurious apartments during the games. Some agents caution their clients about expecting too much due to tepid demand. Others, focusing only on top-tier properties in prime locations, aim to preserve high standards to appeal to very affluent renters.
For ultra-high-end properties, if prices plummet excessively, renting them out might no longer be financially viable. For instance, 100-square-meter premium apartments currently command around €10,000 per week—a significant reduction from rates two or three times higher just months ago.
Historical precedent from past Olympic Games
Olivier Petit from In Extenso, a firm specialising in the hotel market, draws parallels between the current situation in Paris and what occurred during the London Olympics. He recalls that although rental prices fell in the months leading up to the event, they remained double the average rate for a night’s stay even towards the end.
With nearly three months remaining before the opening ceremonies, there’s still ample time for the rental market to stabilise. Both event organisers and potential attendees can benefit from the current conditions, ensuring that accommodations align with expectations and needs.
The upcoming Paris Olympic Games present a unique scenario where typically expensive rental properties are becoming more accessible. This situation offers a golden chance for last-minute travellers to secure luxurious accommodations at reduced costs and for investors to adjust their strategies according to the evolving market dynamics.
Overall, the phenomena leading to decreased prices reflect the fluid nature of housing markets during large-scale events. As the Games draw nearer, both visitors and property owners will need to stay vigilant and adaptable, leveraging the opportunities that the current trends provide.
