As the Olympics approach, some property owners are considering the possibility of getting into rental. For this, it is imperative to take into account a certain number of elements in order to obtain the best profitability. It is true that during such events, a shortage of housing is felt and therefore a real estate investment in Paris in an appropriate district represents an ideal situation. But do not forget that as an owner, you have obligations and rules to respect.
Featured on Forbes: Expert Advice for Property Investors! Discover valuable insights on making the most of your property investments during major events like the 2024 Olympics. Read our contribution to Forbes here!
The opening of the ticket office since the end of 2022
The Paris 2024 Summer Olympics are fast approaching. Many sites have been selected to host the events, mainly in the Île-de-France region and in Paris. But other major cities will also host events such as Lyon, Bordeaux, Saint-Étienne, Nantes and Lille.
If you want to invest in real estate in Paris, the Olympics are an excellent opportunity. It's an interesting strategy, just take the example of the Olympics that took place in 2016 in Rio de Janeiro. More than 500,000 tourists arrived in the city and unfortunately the hotels were full. So as not to miss the event, people then fell back on furnished rented accommodation. On average, the night was billed at €185.
The situation is strictly identical during the London Olympics in 2012. But this time, you had to pay an average of €400 for one night in Airbnb accommodation. Faced with such figures, investing in Parisian real estate remains particularly interesting, provided that you target preferred neighborhoods.
The rules to know in furnished tourist rentals
Whether you own an investment property or a studio in the French capital, it is impossible to free yourself from the rules put in place by the French government and the town hall of Paris. Moreover, this legislation can evolve, even if for the moment there are no specific provisions. If it is your main residence, then the rental cannot exceed the ceiling of 120 days per year.
In addition, before proceeding with your registration on the Airbnb platform, do not forget to file a declaration from the website concerned. Subletting remains possible, but you will need the written consent of the owner. If the property is located in a condominium, take all the preliminary information to ensure that the furnished tourist rental is not in contradiction with the regulations of the condominium.
Do not take liberties with its rules, because the controls are constantly increasing and if you are in violation, you will suffer a substantial fine. So to have peace of mind, while enjoying a comfortable income during the Olympics in Paris, there is one last solution. Hire an Airbnb concierge. It remains specialized in seasonal rentals and with total management, no intervention on your part will be required.
Make your arrangements now
A real estate investment in Paris cannot be improvised, especially since the Olympics are fast approaching. Last year alone, no less than 30 million visitors decided to visit the French capital. It is once again the first tourist city in the world. But this figure is likely to increase significantly during the year 2024.
In addition, the hotel offer will necessarily be insufficient and therefore furnished rentals are a way of taking advantage of the event. Tourists will be ready to pay substantial sums to attend their favorite events. Given the potential demand, any owner of a property in Paris will be likely to rent it.
But of course, location is key. If an investment property in Paris is located in a central area near the events or not far from public transport, the price of the night will obviously be higher than another accommodation located on the outskirts.
For the opening ceremony alone, more than 600,000 spectators are expected on the front of the banks of the Seine. Such an estimate remains very interesting for owners with a view to making a rental. But as prices will rise, customers will also be more demanding. As the owner, you must ensure that the offer perfectly matches the height of the tourists. It is a prestigious event and therefore your property must not have the slightest defect.
Especially since you will be in competition with many other seasonal rentals. Comfort and standing will of course be expected, but it is above all a matter of feeling on the part of potential tenants, because there are no legal criteria. But to compete, you have to be competitive. Once again, the intervention of an Airbnb concierge remains appreciable to put the odds on your side.
By being guided by rental experts with a perfect knowledge of the Parisian market, you are sure to obtain the best possible profitability during the Olympics with a vacation rate almost zero.
Why invest in real estate in Paris?
Do not believe that profitability will only be present during the event. Generally, the price increase begins 18 months before the start of the Olympics. Then, the reservations are more and more intense with a directly palpable renewal of activity concerning the last minute requests. So, if you want to position yourself on the market, it is in your best interest to invest immediately or to think about renting a home you already own.
Even if the ticket office has already been launched, the sales calendar will be spread out throughout 2023. So you still have enough time to position your offer while respecting all the legal provisions taken by the Paris City Hall.
If you wish to rent your accommodation during the spring of 2023, it is preferable to orient yourself on a short-term lease, in other words with a duration between one and ten months. In this way, you have total control over the departure of the tenant and you then adjust the prices in relation to the approach of the Olympics.
The CIO explains that more than 40,000 rooms have been booked in and around the capital, mainly in hotels, youth hostels and residences managed by professionals. But it's a safe bet that this number remains insufficient compared to the real demand. Therefore, the International Olympic Committee will have no choice but to focus on seasonal rentals for individuals.
But to be selected, your accommodation must offer all the necessary equipment and services. But also have a decoration in line with the expectations of the very demanding clientele. For your part, immediately take the necessary measures and do not forget to take out insurance to protect yourself against potential disasters.
What are the necessary conditions to buy a property in Paris?
If you have the necessary cash, you might consider a cash purchase. Unfortunately, few people are able to take out such a sum of money, without going through obtaining a bank loan. To do this, shop around for lending institutions to get the best rate. You could also be assisted by a real estate broker, because he has privileged contacts with banking establishments.
Often, you will be asked for a financial contribution corresponding to 20% of the total price of the property. It obviously takes time to dissect the real estate ads, otherwise you entrust your search to a real estate hunter. Once you have found the property that suits you best, the deed of sale will take place at a notary. But it takes about three months between the signing of the sales agreement and the final deed.
How to quickly find a property to buy in Paris?
You could of course organize your search on your own. But this method requires time and obviously specific knowledge. If both conditions are not met, you could rush into a purchase that will not turn out to be as profitable as expected.
Surround yourself with competent professionals such as real estate agencies, developers, notaries, institutional investors or apartment hunters. In addition, they have a perfect knowledge of the local real estate market. Impossible to ignore the Olympics and therefore this specificity will obviously be taken into account.
Preferably, do not hesitate to pay more for accommodation when it is located in a popular area. You will have no trouble renting it and of course with a higher price. Same profit at time of resale.