Pricing: Determining a Villa’s Market Value
According to reports, market analysis, and the economists, agents, buyers, and notaires we consulted, the majority of French Riviera villa properties listed at over €1 million are listed at unrealistic prices and are sitting on the market until the seller lowers the price to be much lower than others on the market, with the average selling price being around 70% under original asking in 2022/23. Sound crazy? Here’s why.
The French Riviera is a buyer’s market, and has been since 2008. It has become even more so in 2023 (and will be for many years to come) due to many factors, including foreign buyers instead purchasing homes in their domicile countries, and the French government actively disincentivizing second home purchasing. That means that, as a buyer, you have a lot of bargaining power, if you can negotiate directly from the owner. (You can request the owner’s contact info from the government.)
Always remember: The agent, the notaire, and any contractor who works with either of them, all have one goal: to sell you a villa at the highest price possible, as fast as possible. This is how they get paid the most, with the least work. For this reason, it's very important that you don't trust their pricing advice.
How To Answer ‘What’s Your Budget?’
Since so many properties are dramatically overpriced, the best way to answer this question is to say this: “We don’t have a budget. We will pay market value. We will pay for two appraisals (one by our bank’s recommended appraiser) and will base our offer on those. So show us everything that matches what we’re looking for and we’ll deal with the offer price once we find one we like.” Then, you will craft your offer by following the below guide.
Why There’s So Much Extreme Overpricing
“This is a good price and we’ve had a lot of interest. At this price, this villa will sell very quickly. You have to decide right away!”, real estate agents often say (here’s a list of more dishonest things that real estate agents might tell you), hoping to rush you into buying an overpriced villa. However, it is not uncommon for the buyer to realize that this was just a high-pressure sales tactic and that the villa is still for sale months (or even years) later, usually because it’s extremely overpriced.
There are several phenomena specific to this area that encourage sellers to list their properties for 3x to 8x (or more) higher than its actual value…
Agencies Who Overvalue
Real estate agencies tell sellers that they can sell their property for much more than it's actually worth just to secure the listing for their agency. Owners tend to list with the agent that says they can get the most money for them — and it becomes a sort of bidding war between agents who want to secure the listing with their agency. Who would you sign with: the agent who promises to get you €8 million for your villa, the one who tells you they think it’s worth €3 million, or the one who tells you it’s actually only worth €1.2 million?
The result is that villas get listed for sale at three to as much as ten times what they are worth. Many owners end up associating this with their self-worth (it makes people feel like they’re doing OK in life when they’re convinced their house is worth many millions), so it’s hard for them to come to grips with reality.
Many agents also greatly inflate the m² in the listing, to justify the price, since there’s no law that requires villa listings to have accurate m². Then the villa simply sits on the market for years until the seller lowers the price, often several times.
Investors Who Don’t Care
Another phenomenon specific to the French Riviera real estate market: Wealthy investors get agents to list the villas they own at prices that are many times higher that they are worth, on the off-chance that a wealthy person from Monaco (who has not done their research, or does not care about the price) will make a mistake and buy it — then they’ll use the sale money to buy 2 or 3 similar villas and pocket the remaining money.
These owners often own multiple villas which they use for income generation (they rent them out for the summer season). In some estimations, this accounts for almost 40% of villas on the French Riviera! These owners don't really care if their villa sells, and they certainly aren't interested in selling it at market value.
The good news is that the French government is actively trying to disincentivize this sort of investment purchasing, in an attempt to make housing more affordable. This year they added new and cumbersome taxes for second homes (which impacts almost 40% of villas on the French Riviera) and are actively thinking up other ways to disincentivize house-flipping, foreign investment purchases, AirBnb rentals, and vacation homes. You can 100% expect more of this in the future. (Learn more about this in our market predictions guide.)
Memories of Russians
Another phenomenon affecting the French Riviera real estate market, is the hope that silly-spending Russian buyers will eventually come back. After 2014, Russian buying dramatically decreased, and this area felt the fallout. And yet many French Riviera sellers are defiantly holding out hope, waiting for the Russians to come back — someday. But, due to the invasion of Ukraine and the subsequent sanctions and seizures, this isn’t going to happen. Once these sellers realize that the Russian money-tree has died, prices will fall dramatically. Read our supplementary guide to Russians & their impact on the French Riviera real estate market for more about this.
Legal Tax Avoidance
And yet another reason that some property owners list their property for sale without actually wanting to sell it (hence, listing it at a crazy price they think nobody will pay for it), is for legal tax evasion. As long as a villa is listed for sale, the owner is exempt from several expensive property taxes! This applies to non-primary residences, of which the French Riviera has in abundance (almost 40% of villas here fall into this category). Agencies embrace this phenomenon because they can point to these listings as a (false) indicator of where the market is at.
3 Markets in One
The French Riviera is three markets in one: private, off-market, and publicly listed. Any publicly listed villa has first been on the private market and then off-market. Each of these stages have different pricing — especially the last stage, where the pricing gets dramatically inflated.
Market 1: The Private Market. First, sellers try to sell without using an agent. Across France, over 50% of all villas are sold privately, but on the French Riviera this is closer to 75% of villa sales. Many of these are sold to friends-of-friends or via social media posts, etc. As a buyer, this is definitely the best way to buy. You can make a request to obtain the ownership information of any villa.
Market 2: Off-Market. If they couldn’t sell private, then they list with an agent. A large percentage of villas are sold ‘off-market’ by the agent without being listed publicly on the Internet. Many of these get sold to developers before regular buyers even get to see them.
Market 3: Publicly Listed. If nobody wants to buy the villa, then agents list it publicly on the internet. (Learn more in our guide to agents.) These villas –the ones that are publicly listed– are always very overpriced and/or have something seriously wrong with them, which is why they didn’t already sell. They usually sit on the market for years, until the owner gives up or sells privately. Keep this in mind.
Falsified Average Pricing
The average pricing per town is falsely inflated and not based on the true sold prices. See below:
Important: Multiple Reasons Why You Should Ignore m2 Pricing
In France, m² is a scam used to try to move pricing upwards.
There’s so much to say about this, that we made a separate guide all about the m² average pricing and how the m² listed in DVF is, in fact, a complete scam.
Unfortunately, without the real m² size, you can’t calculate the correct m² pricing (this is also why the government website has incorrect m² pricing averages). This benefits the notaires and agents, since they’re paid on % commission, but can seriously harm buyers.
Luckily, it’s not often that a buyer is suckered because most need a mortgage (especially to avoid the wealth tax), and the bank will always require a professional valuation (however, some of these valuators are lazy and rely on the incorrect m² averages, so make sure yours knows how to correctly find the market value).
Keep in mind that price will also vary widely depending on the area within a town. For example, Eze is much more expensive if you’re looking in Eze Bord-de-Mer, which is by the sea. If you’re looking at a villa up by the Moyenne or Grand Corniche, then the pricing drops dramatically.
Need more reasons to ignore m²? On top of all this, agents routinely lie about the m² size of villas, and they get inspectors to lie too. The only way to know the real m² is to have your own, independent inspector measure it.
Need even more reasons? Real estate agencies also manipulate the market by buying properties at prices that are 5x or more above market value, to make a sale at a price that is higher than any other villa has sold for in that area. This is the same market-manipulation tactic that is used in other luxury-focused industries such as the art market. They do this so they can point at that sale in an attempt to justify their far-above-market asking prices, and so that they can manipulate the publicized average m² prices.Now that you understand that you can't trust anything m²-based that you read online, here's how to estimate the actual m² pricing averages:
How to Estimate the Villa’s Market Value
Any offer should take into account the current state of the market, so before you start on the instructions below, read our expert French Riviera real estate market predictions.
Method #1: Compare to the Neighbors
It’s easier than you think! You just need to look at the other properties nearby that have sold, and ignore all the m² pricing.
As you learned above, the notaires are forced to list villas and apartments that have sold on a government website, known as ‘DVF’. It has an interactive map of France which allows you to click on the area of your choice to see the prices of ALL villas that have recently sold, purchased by anyone — SCI’s and corporate purchasers included (but remember: this site has incorrect m² info). Note: the prices listed include TVA (tax).
Here’s an example…
This is a regular, nothing-special villa currently for sale in a less-desirable part of Eze, up a poorly-maintained communal lane. Despite having a lot of road noise and facing East, it’s listed at almost €6 million. An absolutely insane asking price. No villa has ever sold for anything close to that m² price in Eze, in recorded history. But that didn’t stop the listing agents from trying to outbid other agents to secure the listing for their agency. It will sit on the market until the owners are desperate, at which time it will likely sell for around €1 to €1.5 million. It’s been for sale for 6 years so far without a price reduction, and –no surprise– still hasn’t sold. In the meantime it’s listed as an expensive vacation rental with the pitch that it’s worth €6 million (same as most of the houses that sit for years on the market).
Upon checking the DVF government website and Google Earth, we can see that the neighbor’s villa was likely made by the same developer and is the same style and approximately the same size (based on its footprint and floors, as seen via Google Earth); it recently sold for €930,500!
As you can see, this is another example of how the m² is dramatically under-counted by the notaires to falsely inflate the m² average pricing. The notaires website lists the sold (neighbor’s) villa as 125 m², yet the agency listing for the villa states its size as 379 m² (the agent told us this is all above-ground m² and verified.)
And another example:
This villa in the heights of Villefranche-sur-Mer is asking €4.6 million. It’s 260 m² and needs complete renovation (it’s very 1980’s-style inside).
Here’s it is (on the left), next to the neighbors villa, which is more than twice as big:
And in DVF, you can see that the neighbor’s villa (which is much larger, at 670 m²) sold for €1.1 million at the height of the Covid boom (higher pricing than normal). Nearly all of the other villas in the nearby area sold for similar prices.
…and yet, the owner has been convinced by a dishonest agent trying to secure the listing, that their villa is worth €4.6 million, instead of the roughly €800,000 that it’s actually worth.
Method #2: Make a List
The first thing you’ll need to determine is what the historic pricing (based on actual sold prices) in the town you want to buy in is, and what the pricing will be in the future. To do this, we’ll teach you how to analyze and make a list of similar individual villas that have sold in the area directly nearby.
Then find the property via address on Google Earth:
You can even get a sense of the view:
But keep in mind the date of the images, as the villa might have been enlarged or renovated since then. If the image date is older than the last sale, check the planning permissions website to see if it was actually larger than Google Earth shows, at the date of the sale.
Warning: Real estate agencies try to manipulate the market by buying properties at prices that are 5x or more above market value, to make a sale at a price that is higher than any other villa has sold for in that area. They do this so they can point at that sale in an attempt to justify their far-above-market asking prices, and so that they can manipulate the publicized average m² prices. So, if you see one or two sales that are far higher than market value, those shouldn’t be considered in your calculation of the average m².
Step 2 (optional, for accuracy):
Next, compare the map from the planning permissions website (search for the town in the top blue bar, then scroll down and click the green button to view all planning permissions) to the DVF website that lists sold properties with their prices. Click on all the properties that overlap (both have planning and sold) and note the correct m² from the planning permissions website (add the ‘existing’ to the ‘new’ m² to get the total).
Keep in mind that the planning permissions website is not updated frequently, so a villa might have been further expanded (or even knocked down and a new villa built on that plot) since the last update. You can always go to the local Mairie to inquire about specific villas and their latest planning permissions.
Make a list. To calculate the market value of villas in the same area, you’ll need to make a list of the nearby sold villas that are in the same style (Provencal versus modern, as they are priced differently), look closely on Google Earth and guess the average m² sold price of those villas (based on your estimate of the actual m² size) and add screenshots of the villas to your list.
Here’s an example of the list you’ll need to build (that you can use as a template) using a comparison for a villa in Eze. Here’s what it looks like in PDF form (made by print –> custom page breaks –> save as PDF). Here’s another example (this one is of Beausoleil) in a simpler format.
Steps 1 to 3 will give you a ballpark price range. Then, to find out where in that range this villa fits, you look at these factors, which either put it higher or lower in the range:
- What is the quality of the villa and is it well-built? Is the building itself very high quality, middle-of-the-road, or low quality? Does it have things that good builds have, like a ‘vide sanitaire’ gap (mini-basement area so that mold doesn’t build up on the bottom floor), etc?
- Are the interior appliances and finishings, kitchen, bathrooms, floors, etc. luxury or basic?
- Does the villa come with extra space not included in the ‘habitable’ m² — a pool house or guest house / apartment? If so, add value. If not, subtract.
- Figure out if the villa is in a more or less expensive part of that area / town. For example, areas closer to the water are much more valuable.
- How is the view? Could it get blocked in the future? A fantastic, unobstructed sea view increases the value. Seeing neighbors or other villas in the view lowers it. This is less true in areas where most of the villas have a great view, like Eze.
- Is the style of the villa modern or an older style? New, modern villas sell for considerably more per m² (and have many, many more buyers who want them — including wealthy buyers, who will sometimes pay above market value) than traditional, classic, Provencale, ‘modern-style’-Provencale, or outdated-looking styles.
- When was the villa built? Newer villas sell for more money and require less repairs. Older villas likely need work to update the electrical, plumbing, roof, sewer, and other problems, so take that into account.
- Then factor in if it needs renovations, and what that will cost. If it doesn’t, that makes it more valuable, but if it does, that pushes it down in value quite a bit.
- If the land is buildable, so you could expand the house, that would add a small amount of value, but if not, it would remove value. If it’s in a red zone, the price should drop about 20%.
- Factor in how much land is included and the quality of the gardens, pool, garage, etc.
- Does the villa use a shared driveway? This lowers the m² value, and adds regular maintenance costs (as well as potential legal disputes) that you’ll need to budget for.
- Is there a normal-sized swimming pool? If there’s no pool, can one be built? (Make sure to verify that it comes with valid permissions first!) If you’ll need to build it, then deduct double the cost of the pool from the price. If it’s not guaranteed that you can build a pool, then the value drops by about 40%, and you should seriously consider not buying, as you won’t be able to rent it easily (or at all) as a vacation rental, nor will it be easy to resell.
- Will there be noisy construction nearby? (Check building permits here.)
- Is it in a community, walking distance to a school or in a guarded domaine? This increases the price. If it’s isolated, that decreases the price.
- Then check if there’s other factors that would lower the price, such as a train within earshot, being overlooked, a bumpy driveway, low mobile signal, no fiber, or ugly power lines, or road noise — all of which would significantly lower the value.
Another part of determining what a villa will sell for is finding out how long it’s been on the market. Since agents likely won’t tell you the truth (or they’ll just tell you how long they’ve had the listing), the best option is to get the diagnostics reports and the mandat (the agreement to list) from the agent, and look at the date on them. Then you’ll know that it’s been for sale for at least that long. (BUT since diagnostics reports are only valid for three years, if the villa has been on the market for more than three years, the diagnostics might have recently been re-done and show a more recent date.)
If it's been on the market for more than a few months, there's a reason: either the price is much, much too high, or there are serious issues with the property. The longer it’s been on the market, the lower your offer should be.
That will tell you where in the m² price range to value it. You should also take into account the trajectory of the market (here’s how to tell if prices are rising or falling). This will give you a price that you can justify in a letter to the seller.
If the seller accepts, then you can get surveys done to see if the m² is accurate, if the villa needs electrical or plumbing upgrades, etc. and based on that you can further adjust the price before putting the offer in a legal contract with the notaire (whom you should have selected in advance).
Method #3: Get an Appraisal / Valuation
If you’re very interested in a property, and the owner needs more convincing to get to the market price, then you can pay for an appraisal / valuation. But remember — not all sellers really want to sell, or will listen to logic / reason. The only way to truly know if a seller was misinformed by their agent and really wants to sell, is to have a discussion directly to the owner.
To get an appraisal, contact the bank where you plan to get your mortgage. They will have a list of appraisers that they use. Also ask them how long the appraisal is valid for, so it can be used for the mortgage (otherwise you’ll end up paying for it twice). Banks always make you pay for an appraisal as part of the cost of setting up the mortgage (it costs about €3000), but usually this is done after visiting the notaire. However, you can choose to do the appraisal sooner, and use that appraisal for bargaining with the seller / proving that the price should be lower.
To choose an appraiser, ask their process and ask if they go based on the m² villa sizes that the notaires publish. If they say yes, then don’t use them. You need an appraiser who understands that the m² listed by the notaires are incorrect, otherwise they’ll appraise the villa at roughly three times higher price than market value.
Here’s how the real estate (and many other markets) work: One uneducated buyer overpays for something, and then all the brokers and agents point to that sale and yell “see? this is the real value of all villas!” Don’t listen. You know the real market value, and it’s based on the majority of sales, not one or two sales that were overpriced.
Make your offer directly to the owner if you can (you can make a request to obtain the ownership information of any villa) or else do it via a notaire, explaining that it’s based on the market value, and stand firm. Don’t negotiate, or the seller will know they can squeeze more out of you and it’ll be harder to reach a market-value deal. Don’t let agents confuse or manipulate you. Stick to your price.
If they say no, you can tell them to come back to you if their property doesn’t sell, and if you haven’t found something else by then, you may still be interested. If they’re a serious seller, this tactic is likely to get you a good price — eventually.
If they’re not a serious seller then they won’t take your offer unless you dramatically overpay, which you should absolutely not do (if you’re in a rush to find housing, it makes more financial sense to find a yearly rental while you continue to look for a market-price villa). Buying real estate on the French Riviera is all about patience. You will find a great villa at market value eventually. (It typically takes years of looking.)
The best situation is to find a serious seller whose villa doesn’t have any major issues, but where it hasn’t sold because it’s overpriced. Then you use this tactic and offer market value (which could be, in many cases, much less than half of the asking price!). Keep checking in, and eventually when the villa doesn’t sell, they’ll come back to you when they’re desperate to sell (when the time has run out on their divorce/tax/etc. situation) and at that point you might even be able to negotiate an under-market price to complete a quick sale.
Have patience, as buying real estate is much like marriage — if you make the wrong decision it can be a very costly mistake and long-term commitment that’s not easy to back out of.
Here’s a list of (dishonest) things agents say. It’s very important to look at the list regularly so you don’t fall for their lies.
Buying a Villa? Read This First!
When you’re ready to look for a property, make sure to read our complete guide to buying real estate in France. These guides explain how to estimate a property’s real value, how to get the best price and avoid over-pricing, what to look out for, how to avoid getting scammed, and more.
First, in order to understand the real estate market in France, you must understand how m² pricing is a giant scam. Then, you can move on to the other guides:
Our guide to where the market is headed includes: French Riviera real estate market predictions, current & historic pricing trends in the market, and why prices will continue to fall. Plus, supplementary guide to Russians & their impact on the French Riviera real estate market.
Our guide to real estate listings includes: how to find villas for sale, what to look out for, misinformation and warnings, auctions & foreclosures, buying direct from sellers, why timing is everything, and the reason why only about half of villa sales are publicly listed.
Our guide to scams and secrets includes: warnings about the unethical tricks that agents, notaires, sellers, developers and builders use to get more money out of you. This is a must-read, and the whistleblower guide that those in the business don’t want you to see.
Our guide to real estate agents includes: the dishonest things agents will tell you, how real estate agencies operate, buyer’s agents and property finders, why you should avoid illegal and non-local agents, and who to trust (an important warning).
Our guide to important things to find out includes: diagnostic reports and surveys, sun & micro-climates, potential issues with the view, housing taxes, the age, internet and mobile access, danger (red) zones, health risks, privacy & space issues, nearby problems, what you’ll actually own, illegal additions and structures, why they’re selling, how to verify, and more.
Our guide to things to consider includes: your actual costs, issues with buying a ‘newly renovated’ villa, learning about local crime & squatters, and questions to ask yourself.
Our guide to the buying process includes: negotiating the price & the initial offer, choosing an honest notaire, buying in the black, the official offer & deposit, using a SCI, contract pitfalls, the cooling-off period, what to do before handing over the money, and the final signing.
Our guide for after you buy includes: insurance pitfalls, tips for second homes, renting your villa, renovating, and what to know about hiring people.
Guide for sellers: How to price your villa so it will sell.