Real estate prices continue to rise. But with credit rates rising, prices could start to fall in some cities according to MeilleursAgents.
The real estate market looks poised to top 1 million transactions in older properties this year. To find accommodation, invest or acquire a property, the French continue to bet on stone. Until the end of last year, they were supported by the low mortgage rates of recent years. But the resurgence of (according to INSEE), and the successive rises of the European Central Bank in its interest rates cut the . It is not enough to discourage the French: according to the projections of the MeilleursAgents platform, the real estate market should exceed one million sales of old houses this year.
Almost a rate hike point
The average rate, excluding insurance and all loan terms combined, rose from 1.07% in January. And some banks offer significantly higher rates, sometimes more than 2% according to brokers. The increase in the cost of credit translates into a reduction in borrowing capacity, already limited to 35% of the debt and with terms of up to 20 years. Consequently, unless they have savings or aid to increase their personal contribution, the budget available to households to finance the purchase of a property is reduced. Therefore, this could weigh on prices in the future. “A landing phase has already begun, estimates Bárbara Castillo-Rico, head of economic studies at MeilleursAgents. This slowdown reduces the gap with apartments, whose prices increased by 4.7% in a year to the end of August, compared to + 6.5% per year earlier.
Sustained demand but not everywhere
MeilleursAgents then matched their market data (rates and prices) with data from the real estate listing site SeLoger, according to geographical areas (Paris, 10 large French cities, 50 cities and the rest of the territory). “The scarcity worsens for the rural world with[…]