New homes built fell by 17% last year, whilst sales by a similar 18%, despite which average prices held up.

According to figures released by the Ministère de l'Écologie, du Développement Durable the total number of homes built in mainland France in 2012 (excluding Corsica) was around 320,000, substantially below the 400,000 being achieved prior to the financial crash of 2007-8.

Sales also fell by 18% in 2012 to 86,200 homes, the vast majority of which were apartment sales.

The Union des Maisons Françaises (UMF), a trade body for the housebuilding industry, forecast sales will fall by a further 25% in 2013, a third successive year when sales will have fallen.

Although the economic crisis is at the root of the fall in activity, the house builders also point to the reduction in tax breaks for investors, historically used as the motor for the new build housing sector. Over 40% of the reduction in sales last year was due to the withdrawal of investors from the market.

Despite the fall in sales, the price of new houses remained steady at an average of €238,000, a fall over 2011 of 0.7%. By contrast, apartment prices rose marginally by 0.9%, to reach an average of €3,861m².

The table below shows a regional breakdown of new house building in France for last year.

The majority of new homes constructed were apartments. The total includes homes for rent as well as those for sale.

Not surprisingly, the highest levels of activity occurred in the Ile-de-France, Provence-Alpes-Côte D’Azur and Rhône-Alpes, the main economic regions of the country.

However, the number of new homes built fell in regions, except the Ile de France, where it increased by 15.1%.

Largest falls were in Champagne-Ardenne (-29.6%) and Languedoc-Roussillon (-29.2%). There were other large decreases in Alsace (-26.6%), Aquitaine (-27.8%) and the Pays de la Loire (-27.6%).

Source: SOes, Sit@del2