A major study about the future demand for housing in France from the University of Paris-Dauphine has concluded that demand will remain strong in the coming years, with the need for around 500,000 new homes a year up to 2020!

The research team base their forecast on four main structural trends taking place in the country;

Population Demographics

In 2005 there were nearly 13 million people in France over the age of 65 years, a figure that will grow by 10 million to 2050, when seniors will comprise one third of the population.

This growth will not only reduce the number of homes coming on to the market, but it is also increasing the demand for second homes by this group.

In effect, the order of the day is 'mobility and security', with retired persons buying two or more homes, which offers them one home for winter and one for summer, or one to meet their existing needs and one that will be suitable in older age.

Future of Family

The report paints a bleak picture on the future of the family, with divorce rates continuing at around 40%, an increase in those wishing to live alone, and many young adults seeking to move out of the family home as quickly as possible to share with friends.

The authors consider the trend towards the breakdown of the family to be 'irresistible', and that it will continue to push the demand for more homes.

Employment Mobility

Employment trends are also driving the demand for second homes, with an increasing number of professionals leading a nomadic lifestyle, working away from home during the week and returning home at the weekend.

Somewhat perversely, therefore, the growing instability of employment, with many jobs now on fixed terms and based around 'projects' and 'missions', is resulting in increased pressure on the housing market.

Population Migration

Finally, the study also considers that France will continue to remain a popular country for North European and US investors and for those migrating from the new European countries.

The authors argue that there is likely to be an increase in the number of younger families relocating from within the EU, who will continue to maintain employment in their home country and work at distance, or commute between their place of work and their home in France.

In spite of a recent "small" spurt in construction in the last couple of years, historically France has barely managed to construct half the number of homes each year that the study considers is needed if pressure on the housing market is to be controlled.

Investment Opportunity

Whilst the buy-to-let market in the UK is now saturated, across the channel in France, better returns and capital gains are still providing good investment opportunities!!

THE LIST OF THE EMINENT PROFESSORS AND MINISTERS WHO PREPARED THIS REPORT WITH THEIR CONTACT DETAILS AT THE BOTTOM OF THE ORIGINAL REPORT IN FRENCH CAN BE DOWNLOADED FROM www.creditfoncier.fr