More foreign buyers are making real estate investments in Paris and, despite the worldwide downtown, this is expected to remain an attractive investment location. The Paris residential property market has not collapsed like many other markets around the world and the long-term prospects remain sound. Residential property values in Paris, as in the rest of France, have grown in recent years. According to Peter Vines, senior consultant France at CB Richard Ellis International Residential Agency in Paris, residential property prices in France rose by more than 140 per cent between 1997 and 2007. Statistics show that the price of apartments in Paris, which most investors buy, have risen more than 70 per cent over the past five years. There have been signs that the market has slowed this year. Statistics show that there is a clear slowdown in the property market nationally. Transactions and prices are down, while supply and the period taken to sell properties have risen. Paris has resisted the downturn better than most other regions. Prices were still rising earlier this year even while, according to figures from the Chambre des Notaires, the number of sales for May to July in Paris fell by 17 per cent compared with the same period a year earlier. However, Susie Hollands, founder of property search agency Bonapart Consulting, said that the latest sales figures from her company showed that prices had begun falling in Paris, and there was a decline of 0.2 per cent over the past three months. Miranda Bothe, managing director of Paris Property Finders, said: 'What does seem true at the moment is that there is a bit of a waiting game happening on both the selling and buying side. There is less on the market now than would normally be the case [this time of year] and properties are staying on the market longer so there is more room for negotiation in the asking price.' Most experts believe that the market will not collapse. Mr Vines said that prices in Paris would probably fall by 10 to 15 per cent, which is less than the 15 to 20 per cent forecast nationally. Mortgage lending in France has always been more conservative than in Britain and the United States and there has been no cut-off as a result of the global financial crisis. At the same time, the physical constraints of Paris mean that there are limited possibilities to build new housing, but demand will remain strong. The strong euro drove many foreign buyers away from Paris. Now the euro has weakened, making the city more attractive, although many foreign buyers may not have the money to buy. But for those with money to spare there may be opportunities. The recent rapid fall in the euro against the US dollar has made the market more attractive to buyers from Hong Kong. Winkworth France managing director David King said investors usually chose central Paris. This means the Marais, or 1st, 2nd, 3rd and 4th arrondissements, the Rive Gauche, or 5th, 6th and 7th arrondissements and Champs Elysees area in the 8th or 16th arrondissements. These are generally the more fashionable and expensive parts of the city. The average price of an apartment throughout Paris is Euro6,580 (HK$65,113) per square metre. But there are considerable variations between arrondissements, and even within them. The highest prices are in the 6th arrondissement, where the average price is Euro10,230 per square metre, reaching as high as Euro11,110 in highly fashionable St-Germain-des-Pres. However, Ms Hollands said the St-Germain-des-Pres area was overvalued and had become a tourist trap. The Marais offered better value, with a much more authentic lifestyle. The 16th, home of many wealthy French families, is also more reasonable with an average price of Euro7,800 per square metre. These areas, despite their high prices, have limited downside risk because there is strong demand for property in the best parts of Paris. According to Mr King, the next six months may be a good time to invest. Paris is the most visited city in the world, and this inflow of tourists, and high local demand, means that the rental market in Paris is strong. Rental returns are not spectacular, but they are quite strong at about 4 to 5 per cent in Paris, and rents are still rising. Many foreign buyers are not just attracted by financial returns but by Paris itself and opt to let their apartments on a short-term basis allowing owners to make use of properties for their holidays.