The notaries of France presented this Thursday, December 15 the property balance sheet for the past year. If the sales volume once again remains above one million goods sold, the trend is downward.
The million sales once again exceeded
1,133,000 sales: this is the number of transactions carried out in France over 12 months at the end of September 2022, according to the annual real estate report presented by the notaries of France this Thursday. While this figure reflects another excellent year on the French real estate market, it is however down from 2021, a record year which recorded 1,206,000 transactions. The volume of sales has begun a slow decline, note the notaries, with a drop since the 4th quarter of 2021.
An increase in loan denials
A drop in the number of sales which can be explained, among other things, by an increase in refusals of financing by banks. While a study conducted by PAP.fr estimated that one in 10 borrowers had been refused a loan in November, the broker Vousfinancer reported a drop of 20% to 25% in November compared to November. 2021. Same observation on the side of Le Partenaire, for whom this end of the year 2022 ends rather badly both for bankers / brokers o the files are stagnating while waiting for an increase in the wear rate, than for borrowers. The protective effect of borrowers is no longer tenable, a large majority no longer being able to access property.
On the side of notaries, it is estimated that the wear rate (the maximum rate above which a lending institution cannot offer a mortgage) is actually the cause of an increase in loan refusals, and that it is low-income households that suffer the most.
Less purchasing power
Borrowers who can still claim a mortgage see them rates increase. While the average rate was 1.05% in September 2021 for a 20-year loan, this average is now 2.50% according to the broker Meilleurtaux. Inevitably, borrowing capacity is therefore lower and borrowers are turning to smaller properties. On average, by going into debt over 20 years with a monthly payment of up to a third of their disposable income, French people in mainland France can acquire a home of 80 square meters. This is 4 less than in 2021, an unprecedented fall for 15 years.
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Paris still above 10,000 euros per m2
While Century 21 announced a price per m2 below 10,000 euros for the first time in 3 years in Paris, the notaries’ annual report shows an average price per m2 in the capital still slightly above this bar, 10,590 euros, nevertheless down 1% over one year for older apartments. In the rest of France, on the other hand, the prices recorded by notaries still do not fall, even if they slow down: +2.4% Nantes, +6.9% Rennes or even +7.1% Marseille.