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Loans more difficult to obtain: what consequences for the real estate market?

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Professionals in the real estate sector are concerned to see the number of home loans decrease. This decline would trigger a real vicious circle that would lead to a blockage of the entire market, according to them.

2021 was a good year in terms of real estate sales. Taking advantage of a resurgence of activity after the various lockdowns in previous years, 1.2 million homes were sold in 2021, which is historic. This can also be explained by an exceptional year for borrowers who have rarely been able to take out so many loans. But this dynamic suddenly stalled, to the chagrin of professionals in the sector. With rising interest rates and low usury, the year 2022 has seen a decrease in household borrowing.

“This falling number of loans is affecting the real estate sector as a whole. We need an overhaul of the attrition rate that will enable us to get out of this situation,” confides a professional in the real estate loan brokerage sector to The midi broadcast. “And this situation can become very complex” according to the specialist. With particular potential consequences on construction sites and the construction sector, the largest employer in France. Notary fees and transfer fees may also be affected.

In their last economic report from July, the notaries in France called out “attrition rates which slow down access to credit and risk blocking the real estate market”. The decrease in the volume of transactions due to the reduction in the number of loans granted can lead to a decrease in the price of the stone market. It’s the vicious cycle that real estate agents fear. “Late on the 1steh quarter next year, credit rates could reach 2.5 to 3%,” explains Julien Monfreux, broker at ACE Credit, who estimates that “the attrition rate needs to be reviewed in a fairly significant way” to revive activity.

After the various calls for help from real estate players, according to Les Échos, the Ministry of Economy would be in full “expertise”. The Banque de France, lenders and consumer associations have been received at Bercy in recent days to find solutions to avoid a blockage in the real estate market.

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