Discussions are underway between Bercy, the Banque de France and various players in the real estate sector, including banks and brokers. The goal: to avoid a blockage of the sector, impacted by an increase in the refusal of credits.
Will there be movement on the mortgage front before October 1, when the wear rate will be raised, like every quarter? Currently set at 2.57% for loans of 20 years and over (2.60% for shorter terms), it had been raised by 0.17% on July 1 compared to the previous quarter. According to several forecasts, could be further increased by 0.20% to 0.40% from October 1.
Despite everything, the usury rate, this maximum rate at which banks can lend money and including the nominal rate, the borrower’s insurance as well as the various administrative fees, is under fire from all critics. It must be said that if the wear rate increased by 0.17% between April 1 and July 1, the increase in average real estate rates over 20 years was 0.44 points over the same period.
According to an Opinion Way survey commissioned by the Association Française des Intermediaries en Bancassurance (Afib), 45% of real estate loan files presented since January are rejected because of the rate of wear: that is to say nearly one file out of two.
Banks invite to make an effort on rates
A few weeks ago, another Opinion Way survey commissioned by 6 professional associations of intermediaries in banking operations and payment services (IOBSP) explained that 40% of credit intermediaries were refused 40% of files, while 85 % of them reported a refusal rate above 20%.
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If credit brokers have been sounding the alarm for many weeks, other players in the sector, usually more measured, also report a tenseness in the mortgage market. This is the case, for example, of the National Agency for Housing Information (Anil), which in its rate indicator for the 3rd quarter of 2022 affirms that this increase (in the wear rate) remains insufficiently correlated with the progression of market rate in a context of high inflation. An increase in rejections due to usurious credit (i.e. exceeding the threshold of wear) was observed in July-August. Indeed, only households benefiting from the lowest rates can currently hope to access a loan if we consider the guarantee and insurance costs which are added to the interest rate.
Will banks be forced to curb rate hikes?
Faced with more and more criticism, Bercy took up the subject. Expertise is underway, assures the Minister of the Economy to the things. Information confirmed by the Parisianwhich explains that a dating series starts this Wednesday between the Banque de France, Bercy, lenders but also consumer associations.
Proof that the file is taken seriously by the government. Always according to thingsif a change in the mode of calculation of the wear rate is not the order of the dayon the other hand, the banks would have been asked to make an effort and slow down the rise in rates.
Real estate credit: what should we expect for the return?