Mortgage credit continues to recover in October

It amounts to 10,4 billion euros, excluding renegotiations, and is up for the third consecutive month.

The Banque de France sees in this figure a "recovery trend since the low point of March 2024".

Real estate credit had only exceeded the symbolic 10 billion euro mark once this year, in July. At the current rate, however, 2024 is likely to be the weakest year since 2014.

"The credit market situation has been improving since the beginning of the year, benefiting from the recovery in real estate purchasing intentions of households reassured by the slowdown in inflation and a more dynamic banking offer," noted the authors of the monthly study by the Crédit Logement/CSA Observatory on Thursday.

But average interest rates on new loans now seem to be landing: they only fell very slightly between October and September, from 3,56% to 3,51%, according to the Banque de France.

These rates are exclusive of fees and insurance. Including all fees, the rates reached 4,39% for a term of twenty years or more in the third quarter, according to the same source.

For 100.000 euros borrowed over 20 years, you will need to count on around 50.000 euros in credit costs over the duration of the loan.

This high level reached in just a few quarters represented a real shock for households' real estate purchasing power. In the first quarter of 2022, it was two and a half times lower, at 1,80%.

In addition, the government's censorship "risks generating further wait-and-see attitude on the part of buyers, whether they are first-time buyers, second-time buyers or investors, because they need visibility and confidence in the future to plan for a property purchase," stressed Brice Cardi, president of the l'Adresse real estate agency network, on Thursday.

"With the fall of Michel Barnier's government, the housing sector is heading for a new period of uncertainty," estimated the Orpi real estate agency network in a note.

Illustrative image of the article via Depositphotos.com.