Which city should you choose for your rental investment?

You’ve likely noticed that articles encouraging real estate investment are popping up everywhere online lately. And for good reason! For several months now, borrowing rates have been steadily falling, mortgage terms are becoming more flexible, and loan durations are often being extended. Meanwhile, the number of transactions is skyrocketing, particularly in the existing property market. Nevertheless, one question remains for prospective buyers: Where should you invest?

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Toulouse

We recently highlighted the many advantages of the "Pink City" for seasonal rentals two weeks ago, so it’s no surprise to see Toulouse in this selection of French cities for investment!

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With a price per square meter of 3,382 euros—quite reasonable given the size of the metropolis—the Toulouse real estate market is as dynamic as the city itself. Each year, the city welcomes over 5,500 new residents. This impressive appeal shows no signs of slowing down! Attracting a steady stream of students, families, and professionals, Toulouse is set to launch a brand-new metro line in 2024, along with new training complexes. So, even if prices were to rise, the rental demand, which is already strong, will remain high. Just be sure to invest in areas with good transit links and/or proximity to university or aerospace hubs.

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Paris

On the international stage, according to HomeToGo, the City of Light ranks among the top five most attractive European capitals for rental investments. This impressive ranking is bolstered by a fourth-place finish in terms of amortization period, notably ahead of Madrid, with 17.9 years compared to 20.4 years. Thus, although prices tend to climb, the rental demand is such that the rental yield remains highly attractive.

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Indeed, thanks to its global influence, strategic geographic position, and cultural richness, Paris attracts over 47 million travelers annually and is also one of the world's top student cities. As a true capital of economy and innovation, the city houses the headquarters of about forty multinational corporations. Furthermore, La Défense is a premier business district! Young professionals, executives, employees, students, tourists... High demand means an increase in the price per night for short-term rentals!

Lille

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Another dynamic and attractive city, Lille, was named the third-best city for investment by the website SeLoger.com. Like Toulouse, the Lille metropolitan area offers an affordable price per square meter: 3,224 euros. Close to the capital and other major European cities, Lille also boasts a significant student population that guarantees strong demand, a flourishing real estate market, and the longest metro network in France outside of Paris. Achieving a high-yield rental purchase there is relatively straightforward.

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Lyon

A true real estate staple, Lyon follows the same trend as the previous major cities, thanks to an equally advantageous location—two hours from Paris and close to Geneva and Italy—and strong economic vitality. As a cradle for many companies, particularly in the new technology sector, the "City of Lights" welcomes new residents every year, just like Toulouse. This demographic appeal is a significant advantage for rentals!

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And that’s not all! Also renowned for its higher education institutions and university hubs, Lyon is the second-largest French city in terms of student numbers, 10% of whom are international. This is a major asset for medium-term rentals! Properties may be expensive, but one thing is certain: attractive rental yields are guaranteed.

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Montpellier

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By setting your sights on Montpellier, your purchase can also turn into a very profitable rental investment, especially in the existing property market, where the price per square meter is around 3,090 euros. It’s an accessible price for a city in the midst of a demographic boom. Indeed, it’s not without reason that this city is nicknamed "La Surdouée" (The Gifted One)! Montpellier attracts a large number of young professionals as well as many students, and counts numerous researchers among its residents. With the added bonus of solid economic vitality, the city possesses assets that can significantly tip the scales for buyers. So, are you tempted by Montpellier?

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To better understand the process of purchasing a property for rental purposes in a major French city, you can run a mortgage simulation on a dedicated website.

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Your Airbnb concierge is here to help

Whether you are just starting out or have already acquired your property, consider concierge services! At Welkeys, we handle the entire rental process and can also help you estimate and optimize your income. From creating the listing to welcoming guests, we take care of everything!