While American pollsters are having all the trouble in the world to decide between the two presidential candidates, French luxury real estate professionals are taking a cautious approach when it comes to deciding who will win the election. Kamala Harris or Donald Trump will have the most favorable impact on sales. One thing’s for sure: this vote should soon bring an end to the wait-and-see attitude shown by American nationals for several months, who remain the biggest foreign fans of high-end stone.
“As is the case with the French, Americans are reluctant to buy in the pre-election period, points out Alexander Kraft, CEO of Sotheby’s International Realty France. This clientele had been present in France for months and had made a good number of visits, but these transactions had not materialized. It’s only in the last fortnight or so that the most impatient are taking the plunge and promises to sell are once again being signed.” Thibault de Saint-Vincent, President of Barnes, who spends 4 months a year in the United States, has observed this wait-and-see attitude on both sides of the Atlantic. New York.
Fear of taxes
“It’s not a very dynamic period, he admits, but I doubt that the outcome of the elections will have much impact on the market. What really counts here are interest rates, which are still much higher than in France. And with the Fed’s clout and independence, the political situation won’t change much in the short term.” In his opinion, local factors are now more important than the president or chairwoman. “The dynamics are very different depending on the region, the city, the action of the mayor or the local tax system, he explains. In San Francisco prices are collapsing while they are exploding in Miami, taxes are reduced in Florida and very heavy in New York…” In view of all these local uncertainties, he doubts that the impact in France will be very precise.
Eric Donnet, Managing Director of Féau, is equally circumspect. “Americans represent half of our foreign clientele, he stresses, they are therefore very important, but distinguishing the specific impact that the election of one candidate rather than another would have seems tricky to me.” It has to be said that, like Americans, luxury real estate buyers are very divided. “Florida’s clientele is often Trumpist, whereas in New York Democratic sensibilities generally prevail”points out Thibault de Saint-Vincent. For his part, Sébastien Kuperfis, CEO of Junot, sees potential positive impacts in both cases. “It’s possible that if Kamala Harris wins, some investors will fear higher taxes at home and turn to France, he explains. We’ve had this happen quite markedly with British customers fleeing their government’s socialist measures. Conversely, if Trump wins, frightened and/or disgusted Democrats might choose to come to France in exile.”
Paradoxical situation
“The situation is likely to be quite paradoxical if Trump wins, says Alexander Kraft. The most affluent customers look favorably on Trump, believing him to be good for business. And at the same time, from an international point of view, Trump’s return may worry the markets and lead to a highly volatile situation, depending on his impulsive decisions.” Ultimately, the main impact of this election could well be the resulting international climate: the management of the Ukrainian or Israeli-Palestinian issues in particular. Confidence in the future remains the main driver of the real estate market. On the other hand, the worst situation would be one of prolonged uncertainty in an election with no clear winner.