The average interest rate on new home loans is, however, slightly more favourable to borrowers, falling from 4.17% in January to 3.70% in June. However, this slight drop has not helped to revitalise the property market.
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New mortgages fell to their lowest level in ten years in the first half of the year, according to data published Monday, August 5 by the Banque de France. Buyers, stuck between still high rates and prices that are not falling or are falling only slightly, are becoming rare.
The total amount of new housing loans excluding renegotiations amounted to 47.3 billion euros between January and June 2024, down 36% over one year and at its lowest since 2014. The average interest rate on these new loans is, however, a little more favorable to borrowers, according to the same source, falling from 4.17% in January to 3.70% in June. These rates are excluding fees and insurance. This rate was still two and a half times lower in the first quarter of 2022, at 1.80%.
While this slight downward movement and calls from banks are normally likely to boost the market, potential buyers are not rushing to the door. The main obstacle is shared by all market players: still high property prices. The political context in June added a degree of uncertainty and wait-and-see attitude for households.
