Since the start of the year, inflation has been soaring in France and with it, collateral damage, mortgage rates. After a historic low reached last December (1.07% on average), they are frankly rising again. ” Since January, the 20-year average rate has increased by 0.6 points. This increase is unprecedented in its speed, was alarmed Pierre Chapon, co-founder of the broker Pretto, during a press conference on July 5. ” We are heading towards a doubling of rates by the end of the year… “.
18% of files are no longer fundable
An average rate of 2.4% over twenty years in December 2022? ” No it’s not science fiction “says Pierre Chapon. According to the broker’s estimates, a household with a net income of 4,000 euros per month will see its borrowing capacity drop by 12% between January and December 2022, i.e. 31,000 euros less!
A sharp decline in borrowing capacity.
The scenario seems credible: according to the latest scales of banks, anyone who borrows between 80,000 and 120,000 euros can now expect an average rate of 1.66%… instead of 1.06% in January. ” Around 18% of files financed in 2021 [traités par Pretto] would no longer be financeable in the market context of June 2022 says Pierre Chapon. The upcoming rate hike will further exclude a number of households from the market, 220,000 in total over the year according to its estimates.
Evolution of average rates over 20 years.
| Photo credits: Pretto
” This situation can have serious economic and social consequences that can lead to a real estate fracture. “Alerts the broker, who notably questions the method of calculating wear rates. ” To determine them, it is necessary to take the average of the overall effective rates of the loans granted over the previous quarter, and add a third. Three reference months is too long. This creates a time lag disconnected from the marketcritic Pierre Chapon. It would be necessary to average over a month for it to be consistent.. »
Insufficiently raised wear thresholds
As a reminder, the wear rates have just been recorded, on 1er July, at 2.47% for loans with a term of 20 years and over (instead of 2.40%), and 2.60% for those under twenty (instead of 2.43%). Insufficient in the eyes of brokers, given the maximum authorized debt ratio of 35%. According to Pretto data, one-third of borrowers earning less than 3,000 euros net per month are now refused credit, either because the overall effective rate (APR) of their file exceeds the usury rate, or because their debt ratio is even slightly higher than 35%.
As example, the broker mentions in particular the case of a couple in their forties with a monthly income of 4,000 euros and wishing to borrow 132,000 euros over 25 years, or 545 euros of monthly repayment at 1.77% according to the Pretto grid. Despite their contribution of 25,000 euros, their request was refused for exceeding the debt ratio because they already had a loan in progress.