While the real estate loan market is picking up, online banks are hoping to take their share of the pie. But not everyone has the same strategy.
The end of the real estate loan struggle? It must be said that for two years, borrowers and lending organizations alike have been sticking their tongues out. The average rates over 20 years are in fact past 1% in January 2022 more than 4.5% at the end of 2023.
In this context, online banks have had to adjust their strategy. Like all banking establishments, they have drastically reduced their size over the last two years. If Fortuneo, Hello bank! and BoursoBank explain MoneyVox having always continued to offer real estate credit during this troubled periodthere is no question, for example, of offering real estate credit at any price.
At BoursoBank, we have never stopped offering real estate loans, but we have been obliged to follow the rise in refinancing rates and adjust accordingly, explains for example Xavier Prin, marketing director of the online bank. Our strategy is to earn very little but on all products. We are very well positioned: savings accounts offer good returns and on daily banking, customers have no or very few fees. Under these conditions, we cannot afford to sell property loans at a loss. This may explain why our rates may occasionally have been less attractive than other establishments which do not have the same constraints.
Customer feedback is starting to be very clear, we can see it through the requests for simulations.
Fortunately for borrowers, the grip has been loosening in recent months. Not enough, for the moment, to fully restart the machine, even if the trend is slowly starting to reverse. We expected 2024 to be a year of gradual recovery, and this is what we are seeing, judges Gregory Guermonprez, director of Fortuneo. Each quarter should be better than the last. We have had a lot more requests over the last 3-4 weeks, even if the credit cycle is quite long, we feel a real dynamic of recovery.
Customer feedback is starting to be very clear, we see this through the requests for simulations, agrees Bertrand Cizeau, director of Hello bank!. These are the beginnings which show that the market is picking up again and that the intentions are there. For his part, Xavier Prin confirms that production has been resuming since the beginning of September 2023, even if it remains far from the volumes of 2021 for the moment.
Faced with this recovery, the online banks surveyed by MoneyVox all affirm an appetite for real estate credit. For customers who want to make a digital bank their main bank, real estate credit is a must-have, assures Batrice Breton, personal market marketing manager for Hello bank!. Real estate credit is one of the first reasons why a customer leaves their bank. We must therefore be attentive to the needs of our own customers. This is also a great time for new customers who appreciate the simplicity and speed of our digital journey to join us.
Real estate credit as a loyalty product
If Fortuneo and BoursoBank also offer financing solutions both to their customers and to prospects who could join their ranks, their vision is a little different. Online banks were built without real estate credit Originally, we were able to capture and retain customers even without this product, says Gregory Guermonprez. Real estate credit is a plus but that’s not why you come to an online bank, unlike a traditional bank.
An opinion shared by Xavier Prin: Last year, 1.4 million new customers joined us, 1.2 million net of closures [ce qui signifie 1,4million de nouveaux clients pour environ 200000 fermetures de compte, NDLR]. With this figure, we are the bank which recruits the most customers in France for the second consecutive year. These figures are far higher than the overall production of real estate loans. Real estate credit is not a customer acquisition lever, but rather a loyalty product.
The marketing director of BouroBank nevertheless confesses the desire to make credit in general, and real estate credit in particular, a major activity in the years to come because we cannot set the objective of being the main bank for our clients without offering them financing for their projects. Real estate credit is therefore a major area of development. We are very ambitious in this sector.
While credit rates have been falling in recent months, averaging 3.84% over 20 years, how are online banks positioned today? In terms of the rates offered, we offer some of the lowest rates on the market with 3.59% over 25 years for the best files. BoursoBank’s promise is to be the cheapest bank. We try to respect this commitment on all our products, assures Xavier Prin.
At Fortuneo today, many borrowers can obtain a credit rate below 4%, 3.75% or 3.85% for longer terms, explains Gregory Guermonprez. For its part, Hello bank! displays a rate of around 3.85% over 20 years.
But for Bertrand Cizeau, the important thing is elsewhere: It is important to be well positioned, but we do not seek to be at the lowest prices on the market at all times. It is better to look at the total cost of credit and the customer experience. Borrowers are not necessarily looking for the lowest rate, but accessibility, which is why we do not require a minimum personal contribution but rather look at the borrowing capacity of our customers.
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