Determinants of housing price evolutions for the French sub-markets

Housing price dynamics are well described at the country or region scales, but they suffer from a poor understanding of the fundamentals driving these dynamics, especially locally. Many indicators produced by various actors effectively capture price fluctuations but fail to explain the mechanisms governing these changes at a local level. This paper investigates the determinants of housing price evolutions across French submarkets from 2010 to 2020—a period shaped by economic recovery and quantitative easing policies—using a complete and precise database of housing price indices. This work aims to measure the relevancy and explanatory power of a set of economic, demographic, and financial fundamentals at a local scale, covering all of France. The main objectives are to highlight the underlying factors of submarkets in France and quantify their relative influence. The study leverages time series data retrieved at the finest geographical scale, selected from among the most frequently cited variables in academic literature. The findings reveal that, while the determinants are common across the country, their impacts vary significantly depending on the segment and region. The richness and precision of the housing price index database, combined with segmentation based on urban population size, underscore how financing conditions and socio-economic factors drive real estate prices, particularly in the largest urban areas by population.