Hollande tax hikes hitting Paris luxury home prices | G7Finance.com ...

By Brenda Goh and Tom Bill

LONDON, Sept 10 |
Sun Sep 9, 2012 7:01pm EDT

LONDON, Sept 10 (Reuters) ? Upmarket house prices in Paris
reversed two years? growth in the first half of 2012, falling
3.4 percent on lower demand among well-heeled Parisians looking
to flee France?s rising taxes, property agent Savills
said on Monday.

The decline in Paris came as prices rose in rival financial
centres London and New York, 2.8 percent and 1.1 percent
respectively, with the Big Apple seeing a world record price for
an apartment, Savills said in a report on major cities.

?Paris is the biggest loser of 2012,? Savills said, citing
uncertainty around the future of the euro zone as another reason
for the decline.

?Further price falls now seem unavoidable in the French
capital, and London is the potential beneficiary as
international money seeks an alternative haven within the
geography of Europe, but outside the euro zone,? it said.

France?s left-leaning prime minister, Francois Hollande,
scrapped tax breaks for the wealthy i n July and has been
considering a 75 percent tax rate for top earners, prompting
Parisian bankers to consider moving abroad.

Parisian property prices ballooned in 2011 as investors
sought to shelter their wealth from low interest rates, said
Alexander Kraft, Sotheby International Realty?s head of France
and Monaco.

That bubble was now bursting, he told Reuters. ?A lot of the
real estate agents that sprouted up a year ago are beginning to
close their doors.?

In April, property agent Knight Frank said online enquiries
from France had spiked 19 percent year-on-year for homes in the
priciest districts of London, a city also buoyed by demand from
Russia and the Far East.

Last December, the world?s most expensive flat per square
foot was bought by Russian fertiliser tycoon Dmitry Rybolovlev
as a base for his student daughter at a price of $88 million, or
about $13,000 per square foot, from former Citigroup chief
executive Sanford Weill.

The 6,700 square-foot penthouse is in 15 Central Park West.
The high price was due to the city?s lack of new-build luxury
apartments, Savills said.

Source: http://g7finance.com/g7finance-news/hollande-tax-hikes-hitting-paris-luxury-home-prices/

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