The French property market remains marked by falling prices following the correction that began in 2024. After weighing on households’ borrowing capacity, mortgage rates are starting to ease, gradually reviving purchase intentions. At the same time, energy regulations and new rules governing holiday rentals are reshaping the decisions of buyers and investors.
Energy performance ratings and the property market: an improvement that may be misleading
Sales of homes with better energy performance ratings increased in 2025, while sales of properties rated E declined. At first glance, the homes being sold appear to be more energy-efficient. Notaires de France urge caution, however: changes to the way the energy performance rating is calculated partly distort year-on-year comparisons.
In 2024, the thresholds for homes under 40 m² were revised, and the calculation method for electrically heated homes also changed. These methodological adjustments automatically move some properties into a more favourable rating band, even though no renovations have been carried out.
Smaller homes illustrate this discrepancy particularly well. In 2025, small apartments had a less favourable distribution of energy performance ratings among sales than apartments overall. To track industry trends and price data by area, the property market on Le Scope brings together useful indicators for buyers and sellers alike.
What this means for buyers
Buyers comparing two properties based on their energy performance rating can no longer rely solely on the letter shown. Two homes rated D today do not necessarily need the same work as a home rated D two years ago. It is therefore important to check the full assessment, particularly the energy consumption breakdown and the year it was carried out.
Properties rated F and G remain under regulatory and commercial pressure. Sellers of these homes should expect a price reduction or consider carrying out energy-efficiency upgrades before putting them on the market.
Holiday rentals: the Le Meur law reshapes the rules for investors
The law of 19 November 2024, known as the Le Meur law, significantly changes the framework for furnished tourist accommodation. Key measures include:
- Municipalities can now reduce the annual rental limit from 120 to 90 days for a primary residence let as furnished tourist accommodation.
- All furnished tourist accommodation must now be registered, and its registration number must be displayed in listings.
- Energy regulations are gradually being extended to furnished tourist accommodation, although the requirements vary depending on the type of property and its location.
For investors who relied on short-term rental income, these restrictions change the numbers. A primary residence rented out for 90 days a year instead of 120 generates a quarter less rental income, while fixed costs such as insurance, property tax and maintenance remain unchanged.
High-demand areas and rural areas: two different realities
In major cities and tourist destinations, local authorities had already introduced quotas or compensation requirements. The Le Meur law gives them an additional tool. In rural or low-demand municipalities, enforcement remains more flexible, and the impact on the local market is expected to be limited.
The profitability gap between long-term rentals and holiday lets is narrowing in the most heavily regulated areas. Some landlords are already switching to standard leases or mobility leases, which offer an intermediate legal framework.
Mortgage rates and purchasing power: how is the recovery progressing?
After prices fell by 2.1% in 2024, notaries observed a stabilisation in spring 2025. The gradual decline in mortgage rates has increased households’ borrowing capacity, supporting transaction volumes without triggering a rebound in prices.
A survey conducted by Immonot among a panel of notaries and property negotiators confirms that the advice given to clients is changing: recommendations are shifting more towards buying than waiting. Building plots are particularly active, driven by buyers opting to build new homes so they can control energy performance from the design stage.
Changing buyer behaviour
The period of high interest rates has left its mark on buying habits. Buyers are comparing more properties, negotiating more firmly and factoring the cost of energy-efficiency upgrades into their overall budget. The asking price is no longer the only consideration: energy bills and anticipated renovation work now play a role in the decision.
First-time buyers, who were hit hardest by rising rates, are gradually returning to the market. Their return depends on financing conditions continuing to ease.
Energy performance and property value: an increasingly strong link
The convergence of energy regulations and property values is no longer an emerging trend; it is a market reality. Homes with better energy performance ratings sell faster and for more than energy-inefficient properties, all else being equal.
This green premium varies by location. In high-demand markets where supply remains scarce, the impact of an energy performance rating on price is tempered by limited availability. In less competitive areas, properties rated F or G face steeper discounts because buyers have more choice.
For landlords, timing is the main challenge. Restrictions on renting out energy-inefficient homes are becoming clearer, but renovation grants change every year, making it difficult to plan how to finance the work. There is still a lack of data on the actual renovation rate of rented homes rated G, making it difficult to assess the real impact of these restrictions on rental supply.
The property market must now be viewed through two lenses: financing conditions on the one hand and the energy performance of buildings on the other. Buyers who factor both into their decision-making have a tangible advantage when negotiating and securing a purchase.
