Mortgage rates have just broken their own record for the second time in as many months. All the conditions are met to get the best loan offer.
Credit rates continue to plummet to historic levels. Once is not custom, the monthly study carried out by the Observatory Credit Housing / CSA reports, for the second consecutive time, of an average rate never yet reached. The month of June was most prolific for borrowers since they went into debt for the purchase of real estate with an average rate of 1.25% based on all durations.
Average rate never seen before
The French have undoubtedly gained real estate purchasing power over the past few years. The cost of credit is so low today that it is 4 times cheaper than in the early 2000s. And compared to the late 80s, rates are even divided by 11. A real bargain to invest in stone, that’s what credit is right now.
Especially since it is possible to negotiate better rates than the average level. These credit offers are however reserved for the most qualitative profiles. Those who provide, for example, the best guarantees and who hold high incomes and good management of bank accounts. This category of borrowers can obtain, depending on the repayment duration chosen, rates of less than 1%. Banks most often make this type of offer over 15 years or less. This also explains why the average rate over this repayment period was 0.99% in June.
Make a longer mortgage: a reality under the present conditions
On the other hand, credit conditions over longer terms remain very satisfactory. Households that took out a 25-year home loan benefited from an average rate of 1.39%. And banking establishments are still very open, even to finance the most complex files. If they are making efforts, it is undoubtedly about the duration of repayment with credits spread over longer periods in order to make projects feasible.
And here again, this is a record since credits have never taken so long to be repaid with 228 months on average. The ability of banks to curb their demands to adopt a more flexible posture is even more visible with loans over 25 years which represented 42.3% of production on the market in June. By comparison, this offer was almost zero in the early 2000s, a sign that banks are more flexible.