Mortgage rates, currently around 3.5%, may face increases soon, reversing the decline from 4.5% to approximately 3.20% between late 2023 and March 2025. Experts warn that rising government bond yields could prompt banks to adjust their rates, despite recent cuts. While some banks may raise rates slightly, a period of stabilization is expected in April. Competitive offers continue, with various institutions launching attractive deals to attract borrowers, particularly first-time homebuyers.
Current Trends in Mortgage Rates
The OAT 10 years, serving as the key indicator for bank mortgage rates, remains around 3.5%. Yet, some experts in the finance sector are cautioning about a potential uptick in mortgage rates. Let’s delve into the details.
Could this mark the end of the recent decline in mortgage rates? After dropping from 4.5% at the close of 2023 to an average of approximately 3.20% in March 2025, there are concerns from certain analysts that rates might begin to rise once again in the near future. According to the broker Pretto, “The upcoming rate schedule for April appears less favorable, with several banks increasing their rates again.”
“The uncertainties surrounding credit rate fluctuations are significant,” states Sandrine Allonier, spokesperson for Vousfinancer. While many banks reduced their rates in March, with some cuts noted on March 5, the recent uptick in government bond yields might lead banks to reconsider their rates, similar to actions taken at the end of January.
Potential Stabilization of Rates in April
The current geopolitical landscape is heavily influencing the OAT. For context, the OAT 10 years, also known as Assimilable Treasury Bonds, refers to a 10-year loan that the French government issues to investors, promising repayment with interest. Commonly referred to as “Treasury bonds,” these financial instruments can be issued for durations ranging from a minimum of 7 years to a maximum of 50 years.
What can we anticipate for mortgage rates in April? “There is considerable variability across banks, as they face high commercial targets while also dealing with rising refinancing costs,” notes Maël Bernier. Some banks may be inclined to slightly increase their rates by 10 to 20 basis points, while others may opt for stabilization.
Pretto also aims to mitigate concerns: “There’s no need for alarm; the observed increases are only between 0.1 and 0.2 points,” the broker reassures. Several factors influence the formation of credit rates, as highlighted by economist Michel Mouillart: “The first is indeed the cost of resources, followed by major benchmark rates. This encompasses OAT rates and those set by the ECB, which guide the credit strategies of financial institutions.”
Another crucial aspect is the commercial strategies of banks, both short and long-term. Following two years of challenging conditions, lending institutions are likely to continue making efforts to attract new clients by reducing their margins. For instance, SG (formerly Société Générale) announced a rate of 2.99% in February, and several other institutions have introduced new discounts since then. Crédit coopératif is offering a 0.3-point reduction on loan rates for clients improving their home’s energy performance. Meanwhile, Crédit Agricole is providing a reduced rate of 1.99% for first-time homebuyers financing up to €25,000 until June.
To remain competitive, Crédit Mutuel is offering loans of up to €30,000 at a fixed rate of 0.99%. Additionally, LCL is providing zero-interest loans of up to €50,000 in collaboration with Nexity for eligible new property purchases. This offer can be combined with the state PTZ, which is set to become more favorable starting April 1.
In this context, the recent rate cut by the European Central Bank (ECB) can be interpreted as a positive signal for banks. In the meantime, “before implementing widespread increases, banks are exploring alternative strategies,” notes the broker Empruntis. Typically, the most substantial rate increases affect the lowest-income profiles. Therefore, for the most qualified applicants, the rise in rates has not yet commenced.
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