Real estate credit still slowing down, according to the Banque de France

The amount of new housing loans, excluding renegotiations, fell again in March, to 6,7 billion euros, the lowest volume in almost ten years. It was 7,4 billion euros the previous month.

The average interest rate for these new loans is, however, more favorable to borrowers, according to the same source, going from 4,11% in February to 3,94% in March, the second consecutive month of decline after the January peak. (4,17%).

These rates exclude fees and insurance. All costs included, the rate between January and March was 4,79% for a period of twenty years or more, according to the Banque de France.

If this downward movement and calls from the banks are normally likely to boost the market, property candidates are not rushing to the gate.

The main obstacle is shared by all market players: a still high property price.

The cost of credit, significant for loan candidates even with the start of a drop in rates, weighs on the real estate purchasing power of households.

Finally, banks and brokers consider that the market is hampered by certain rules decreed by the High Financial Stability Council (HCSF), which regulates, among other things, the conditions for granting real estate loans, particularly in terms of rental investment.

The real estate loan market has been driven in recent weeks by a bill proposed by Renaissance MP Lionel Causse, supported by Bercy, aimed at reforming the HCSF.

Criticized by the Bank of France and emptied of its substance by several amendments, this bill was finally withdrawn last Monday by its author.

The date of the next quarterly meeting of the body, which brings together the governor of the Bank of France François Villeroy de Galhau and the Minister of the Economy Bruno Le Maire, has not yet been announced.

The first quarter meeting, which was never officially announced, was held well but via "a written procedure" Bercy told AFP on Monday, confirming information from Les Echos. It did not result in any change.

Illustrative image of the article via Depositphotos.com.