The real estate market of 2024 recorded approximately 775,000 transactions according to Fnaim, representing a decline of 36% compared to the peak in 2021. This floor level, the lowest in three years, reshuffles the cards for investors capable of reading the weak signals of the cycle.
Thermal sieves and rental bans: the real negotiation lever in 2024
Since January 1, 2025, any property classified G in the DPE is considered non-decent and prohibited from being re-rented. This deadline, known for years, has not been anticipated by a significant portion of landlords, especially for small old units in city centers.
The result is a very targeted distress market. Some owners find themselves with a property that can no longer generate rental income without heavy renovations. We are observing negotiation discounts significantly higher than average on these lots, precisely because the seller no longer has time to wait.
For an investor, the arbitration is technical. Three scenarios emerge in the face of a thermal sieve:
- Acquire at a reduced price, renovate to reach class D or E, then re-rent with an adjusted rent and a revalued asset.
- Convert the property into a furnished tourist rental or coliving, where DPE constraints apply differently depending on the legal regime.
- Renounce the purchase if the cost of energy renovation exceeds the obtained discount, which frequently happens in co-ownerships with classified facades.
The point of caution concerns the DPE reform planned for 2026, which will modify the calculation method for small units. According to Capital, around 125,000 homes could exit the “thermal sieve” category thanks to this recalibration. Anticipating this correction avoids overpaying for a renovation that would become unnecessary.
Rental investment strategy: target areas where supply is contracting
The decline in transactions is not uniform. Fnaim notes particularly marked contractions in the southwest, notably in Gironde, Lot-et-Garonne, Haute-Garonne, and Pyrénées-Orientales, with declines reaching up to 30%. This geographical asymmetry creates two opposing dynamics.
Markets in strong contraction see their available stock shrink. Fewer sellers are willing to sell at low prices, which maintains price rigidity despite the drop in volumes. Meanwhile, rental demand remains strong in these areas due to demographics and the deferral of first-time buyers who can no longer find financing. We have followed real estate on Buzz du moment to measure this tension between supply and demand, confirming a persistent imbalance in several regions.
Conversely, some suburban markets still benefit from the telework effect that began after 2020. The demand for properties with outdoor space and dedicated office has not receded despite the partial return to in-person work. Investors targeting these dynamic suburban areas (TGV accessibility, diverse employment basin) capture rental yields often higher than in major metropolitan areas, with a more accessible entry ticket.
Mortgage credit and rates: the window of opportunity post-ECB
The European Central Bank has implemented four successive rate cuts during 2024. This monetary easing began to spread to mortgage credit rates in the second half, halting the decline in transaction volumes.
The cost of credit remains the primary filter for selecting projects. An investor buying with leverage must factor in the differential between the gross yield of the property and the nominal loan rate. As long as this spread remains positive after expenses, the project holds. The current window, with falling rates but prices that have not yet rebounded, offers a rare alignment.
Three technical parameters deserve attention:
- The usury rate, which had blocked many files in 2023, has loosened with the drop in key rates.
- The HCSF criteria (debt ratio capped at 35%, maximum duration of 25 years) remain unchanged and continue to filter the most strained profiles.
- Renegotiating loans taken out in 2022-2023 at high rates becomes relevant as soon as a sufficient gap opens with current conditions.
Real estate asset management: arbitrating between yield and valuation
The temptation of high gross rental yield drives some investors towards low-priced properties in less competitive areas. This strategy works on paper. In practice, vacancy and unpaid rents often absorb the surplus yield displayed.
A more robust arbitration involves accepting a moderate yield on a property located in an area where rental demand is structurally higher than supply. Capital appreciation over five to ten years more than compensates for the monthly rent differential. Medium-sized cities well connected to metropolitan hubs (rail network, highway) present this profile.
The other often-overlooked management lever concerns the tax regime. Transitioning to LMNP (non-professional furnished rental) allows for the accounting depreciation of the property, reducing the taxable base on rental income. This optimization, purely mechanical, changes the net profitability of an investment without altering the property or its rent.
The real estate market in 2024 has established a low base. Investors who acquired during this trough phase, targeting discounted thermal sieves or suburban areas under rental pressure, are positioning themselves for a valuation cycle that the ECB’s monetary easing is beginning to fuel. The next threshold will depend on the speed of transmission of rate cuts to actual credit conditions.
