The French real estate market in 2024 recorded a marked decline in sales volumes, with around 775,000 transactions for the year, the lowest level in several years. This third consecutive year of volume decline, combined with major regulatory changes regarding energy performance diagnostics, reshapes the conditions for rental or investment property.
EPC and thermal sieves: the real filter for real estate investment in 2024
The parameter that most concretely alters the value of a property remains the regulatory timeline of the EPC.
Since January 1, 2025, properties classified as G can no longer be rented for a new lease, renewal, or tacit extension. Properties classified as F will follow on January 1, 2028, and those classified as E on January 1, 2034. For an investor buying in 2024, this timeline directly determines medium-term rental profitability.
EPCs conducted between January 1, 2018, and June 30, 2021, have expired since January 1, 2025. In practice, a property purchased based on an old diagnosis may be reclassified after a new EPC, with consequences for its rental. Checking the date of the diagnosis before any acquisition has become a basic reflex, not just an administrative detail.
Since July 1, 2024, a decree has corrected the calculation method for the EPC for areas smaller than 40 m². Some studios and small T2 apartments, previously penalized by the ratio between energy consumption and living space, have been able to be reclassified through a new certificate generated by ADEME. Listings published on portals like immobilier-web.fr are gradually reflecting these reclassifications, changing the liquidity of these small properties in the rental market.
Mandatory energy audit upon sale: an additional cost for properties classified E, F, and G
The mandatory energy audit, already in effect for individual houses and buildings in single ownership classified as F and G, has been extended to properties classified as E since January 1, 2025. This document goes beyond the simple EPC: it offers a costed work plan to improve the property’s performance.
For a buyer, this obligation lengthens the sales process and increases transaction costs. For a seller, it may impose a discount if the audit reveals significant work (external insulation, replacement of the heating system). The available data does not yet allow for precise quantification of the average impact on sale prices, and initial observations vary significantly from one urban area to another.
An investor targeting thermal sieves for renovation and re-rental must incorporate this parameter into their financing plan:
- The cost of the energy audit itself, borne by the seller but often passed on in the price negotiation
- The amount of renovation work recommended by the audit, which conditions the future EPC classification and thus the possibility of renting
- The delay between purchase and effective rental, during which the property generates no rental income
Decrease in mortgage rates: a signal to be put into perspective
The European Central Bank has made several successive cuts to its key rates in 2024. Mortgage rates have followed this trend, restoring purchasing power to borrowers after two years of rapid increases.
The decrease in rates alone does not compensate for the decline in transaction volumes. The market has seen a drop of about 36% compared to the peak in 2021, according to Fnaim. The second half of 2024 showed a stabilization of volumes, suggesting that a low plateau has been reached. Projections for 2025 anticipate a gradual recovery, but not a return to the levels of 2021-2022.
For an investor, the question is no longer just “at what rate do I borrow” but “which property will withstand the regulatory constraints of the next ten years.” An attractive rate on a property classified as F without a renovation budget remains a poor calculation.
Real estate prices in 2024: more marked geographical disparities
The price decline that began in 2023 (about 4% on average annually according to the Superior Council of Notaries) continued in 2024, but very unevenly across territories. Fnaim noted more significant contractions in the southwest, with decreases ranging from 18% to 30% in departments like Gironde, Lot-et-Garonne, Haute-Garonne, or Pyrénées-Orientales.
The price gaps between metropolitan areas and medium-sized cities have widened. Tight markets (large urban areas, border zones) have withstood better than areas where supply structurally exceeds demand. This polarization complicates any generalization about “the” French real estate market: there are now several markets, with opposing dynamics.
- Medium-sized cities offering a higher gross rental yield but a higher risk of vacancy
- Metropolitan areas where rental demand remains strong but where the entry price limits profitability
- Tourist areas, driven by seasonal rentals but exposed to local regulatory tightening
What the EPC correction changes for small surfaces
The recalculation of the EPC for properties under 40 m² opens a specific window of opportunity. Properties that were classified as F or G can now move to E, or even D, without any work. This means they become immediately rentable again and their resale value mechanically increases. Reclassified small surfaces regain liquidity that the market had taken from them.
The real estate market of 2024 is less read through overall price curves than through the regulatory constraints that are piling up. A thoughtful purchase now involves checking the EPC, anticipating the rental ban timeline, and having a realistic renovation budget. The mortgage rate, no matter how low, does not correct an unfavorable energy diagnosis.