Maël Bernier, spokesperson for Meilleurtaux.com, expert broker in real estate loans, observes that it has become more complicated to borrow, without contribution especially for the youngest.
Did interest rates go up in January?
MAËL BERNIER. No, they have remained stable. At some banks, we even witness a slight decrease of 0.10% in rates according to profile and duration (<20 years) On average, rates stagnate between 1.25% and 1.3% over 20 years and between 1.50% and 1.55% over 25 years. This is explained by the rate of borrowing from government bonds (ten-year OAT) returned to negative territory in January and which remains at −0.1%. On the other hand, this may seem paradoxical, but what are considered to be the "best records", that is to say those of households with high incomes and personal contributions, no longer benefit from such low rates. than a few months ago (below the 1% mark) and see their rates rise slightly (around 1% excluding insurance). Banks are rebuilding their margins where they can, and therefore on these files on which they had put a lot of effort in 2019.
Is it harder to borrow?
Yes, borrowing has become more complicated since the implementation at the beginning of January of the recommendations of the High Council for Financial Stability (HCSF) capping the effort rate at 33% and the duration of credit at 25 years. The 15% room for maneuver granted to banks to favor first-time buyers’ files is insufficient. A household with, or with too little, personal contribution can no longer borrow over 25 years to buy its first property, whereas it was quite possible in 2019. We already have examples.
For several weeks, we have been witnessing the exclusion of the youngest, with no contribution, no savings and yet displaying a viable living income and an open-ended employment contract. They were fundable only three months ago and no longer are. This is all the more damaging since the amount of a mortgage on these first-time buyers is not high, at 180,000 euros on average (against 245,000 euros for an average loan), which means that the financing of additional costs does not exceed 15,000 euros, a very limited risk, both for the borrower and for the lending institution.