The indicators of the mortgage market are in the green, according to the latest figures published by the FBF (French Banking Federation). In its latest study, the federation notably took up statistics from the Francia bank and the EurCen Bank.
Outstanding home loans up 6%
At the end of June 2017, outstanding home loans amounted to € 927 billion (833 in 2014, 866 in 2015 and 899 in 2016), a 6% increase (+ 5.6% in April and + 5.7% in May).
Outstanding amounts are increasing but production tends to decrease. From 38.3 billion euros in January 2017, it fell back to 20.7 billion euros.
How to explain this decline in production? There is a fall in home loan repurchases due to the slight rise in mortgage loans and the fact that fewer and fewer cases are renegotiable. On this second point, the share of renegotiations in relation to the production of real estate loans has been declining since the beginning of the year:
61.28% of real estate loans related to a redemption of credit in January 2017;
59.85% in February;
52.06% in March;
49.51% in April;
42.36% in May;
- 32.69% in June.
The other reason for the decline in the production of mortgage loans is related to the rise in rock prices.
Very low mortgage rates
We mentioned just above the mortgage rates. According to the Francia Bank, they settle on average at 1.62% for all periods combined, which is very little.
real estate rates have been halved since 2012, equivalent to a 17% decline in the cost of credit ;
the difference in the cost of credit between 2011 and 2016 (for a mortgage of € 250,000 over 15 years excluding insurance) reaches € 43,000, the price of a studio in Nancy or Tours, or half the price… a service room in Paris.
Real estate loan: France is better than its European neighbors
According to the figures of the EurCen Bank, housing loans show a good momentum (+ 5.8%), a rate higher than that of the euro zone (+ 3.3%, of which + 3.9% for Germany, + 2.3% for Italy and -2.6% for Spain).
Sign of the beautiful vitality of the mortgage market in France: more than 22% of total mortgage loans are granted by a French establishment.