Montélimar, gateway to the Drôme Provençale

Lively and friendly, the capital of nougat with its 36,000 inabitants enjoys a strategic location 46 km from Valence, 1 hour from Avignon, 90 minutes from the Alps, Lyon, Grenoble, Montpellier and the Mediterranean. Languishing at the foot of the Vercors, not far from the Ardèche, it offers a quality life-style all year round.

The village first came into being at Gournier, 6000 years ago. In the 19th century, the ramparts were torn down to make way for urban expansion and a public garden : the railway made its appearance in 1854. The Town-hall and Courthouse rose from the ground and the nougat industry provided prosperity for Montélimar. The commune, its hydro-power and nuclear energy owe their progress to the development of transportation and road communications in the 20th century.“Since January 2010, real estate activity seems to have gradually resumed, spurred by lower prices and interest rates, as well as tax incentive measures. However, it would be premature to conclude that there is a marked or overall recovery on the market. It is only the number of transactions that is on the rise,” warns Serge Levêque of Orpi Saint-James. The bracket between 180,000 and 250,000 € accounts for 70 % of demand. Once they have accepted the idea of moving to the outskirts, a majority of locals are in fact purchasing “pavillons” of 90 to 110 m2 with gardens of 500 to 800 m2, on or off estates. High-class apartments ranging from 2,500 to 2,800 €/m2 rouse limited enthusiasm and only sell when their owners make a real effort to lower the prices, especially in the case of recent acquisitions. In addition, this segment suffers the full brunt of competition from new developments, broadly comparable in terms of prices. As witnessed by “Les Grands Moulins” marketed by JW Immobilier. Fully in line with the requirements and capabilities of first-time buyers, small and older units, pegged at 1,000-1,500 €/m2 and up to 150,000 €, sell easily. After 2008, a year of virtually no activity in the price bracket starting at 300,000 €, this estate-agent is delighted to sign a few deals. A farm of 170 m2 in need of a lick of paint, for example, with 100 m2 suitable for development in grounds of 3,600 m2, priced at 440,000 €, and a house of 200 m2 which comes with an apartment of 70 m2 and a further 70 m2 to rehabilitate entirely, in a garden with pool, at 485,000 €.

“According to figures published by the Chamber of Notaries, the value of apartments dropped by 6.9 % in the Drôme in the space of one year, 12.3 % in the plain of Montélimar : prices of houses fell by 9.6 %, or 3 % in the tourist centre, and building land by 2 %, or as much as 16.2 % in the area concerned,” says Antoine Pernot of LCDI Le Comptoir de l’Immobilier, which has over 30 employees in “départements” 26, 07, the northern part of 84, and 13. Today, prices are tending to stabilize. There are a good number of transactions below the bar of 200,000 €, and relatively satisfactory activity up to 250,000 €. In the range from 250,000 to 500,000 €, negotiations are just as delicate to handle as the stocks of available properies, now largely reconstituted. Particularly affected by the crisis, potential buyers - executives, self-employed professionals or managers of SMEs - are trying hard to get back on their feet. With a certain nervousness, which makes decision-taking difficult. Above 500,000 €, Antoine Pernot is seeing a few stops and starts. Not in a hurry, this clientele compares, reflects, analyzes... and is only willing to visit properties that are correctly valued. The speculative era certainly seems gone forever : the market is clean, healthy and transparent. More affordable than in neighbouring “departements”, holiday homes in Provence continue to have their fans, ready to invest 500,000 € or more, mainly Belgian or French. “New properties seem to have the wind in their sails again, as Montélimar is henceforth eligible for Scellier tax benefits, thanks to efforts undertaken by Deputy-Mayor Franck Reynier and his team,” notes Antoine Pernot. Investors are generally prepared to pay around 150,000 €, hoping for a yield of about 4.5-5 %. Similarly, recent measures adopted by the government are giving first-time buyers more purchasing power and, thus, a second wind for bricks and mortar.

"Building land costs from 120 to 150 €/m2 on estates, and from 150,000 to 200,000 € in the case of an independent plot. Most opt for the first solution. Those who choose the second, scarce on the ground at present, are working within a total budget of over 500,000 € for a finished property of 200 m2 in a park with pool and pool-house,” says François Lopez of L’Immobilier Les Allées. From 600,000 € upwards, clients are looking for old stones, charm and character. One particular family, young owners of a “mas” of 400 m2 in grounds of 5,000 m2 with a pool worth 795,000 €, benefits, for example, from the pleasantness of life in the Drôme Provençale, while Monsieur makes trips back and forth for his work. But here again, the current mood is one of morosity and hesitation. Some bold buyers still make offers 30 % below the prices displayed. As for new properties, they owe their salvation solely to tax ben-

efits. Each development must, in fact, correspond to a real need. Central addresses, close to all amenities, thus appeal to the elderly, wanting a practical and convenient home. Of the 54 apartments comprising the “Villa Nova”, only 5 are still up for sale (two 1-bedroomed, three 3-bedroomed), and only 20 % benefit from tax advantages. In this respect, Montélimar still enjoys a good relationship in terms of supple and demand.“With two motorway exits, the bypass to the east, on-going economic dynamism, a new business park to the south, the impending construction of the Congress Centre and the project for the TGV station at Allan, the town is looking forward to a rosier future,” concludes the manager of LCDI, who is also counting on the future arrival of Parisians in search of the sun.