Although they are still far from their lowest levels, mortgage rates are actually on a downward slope. In July 2024, average loan interest rate allocated to buyers fell to 3.62% compared to 3.66% a month earlier, according to the latest Crédit Logement CSA Observatory data published on Thursday, August 1st. A decrease (-0.04 points) less significant than since the beginning of the year (-0.9 points per month on average), which is easily explained: “It is usual in July, with the arrival of the summer holidays, that demand slows down a bit. Banks then pause in the rate cut and wait for the start of the school year in September to revise their scales downwards and support borrowers’ seasonal returns.explains the Observatory. In any case, the decline in credit rates has been evident since the beginning of the year, with the latter still showing 4.20% on average in December 2023. Above all, they have returned to their exact level from July 2023, a month in which they also reached 3.62%.
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10-year interest rates already below 3%
In detail, 15-year loans are drawn at 3.49% and loans over 25 years at 3.60%. As for the rates for loans with a maturity of 20 years, they fall to 3.50%, according to the CSA Crédit Logement Observatory. Statistics confirmed by Cafpi, which in a press release issued on Thursday, August 1, reports average rates of 3.54% in the same period. “Proof that, despite the summer holidays, banking companies are still winning customers and maintaining competition”says the broker. Even better, Cafpi mentions a better rate over 20 years given at 3.18% for the month of July. Which lets him anticipate “rates close to 3% in the coming months» for the best profiles. Finally, the network for loans over the shortest term, namely 10 years, announces that it is now possible to get a loan of less than 3%: “This is particularly the case in Hauts-de-France, where rates averaged over 10 years reached 2.90% this July.”
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Purchasing power is increasing, credit production is starting again
Logically, with the drop in rates combined with fall in pricesthe buyers’ real estate purchasing power increases significantly. For 1,000 euros in monthly payments over 20 years, according to Cafpi, it is possible to buy 39 square meters in Bordeaux or 3.4 square meters more than in July 2023, 49 square meters in Marseille (+3.3 square meters), 46 square meters in Strasbourg (+3 .7 square meters) and especially 50 square meters in Nantes (+7 square meters over a year). And this renewed purchasing power has not escaped credit applicants: “The customers are not mistaken, and gradually return to have their borrowing capacity assessed. At Cafpi, the number of loan archives has thus increased by 35% compared to the beginning of the year.Appreciate the broker. And this demand is becoming a reality, given data from the CSA Crédit Logement Observatory: the number of loans granted increased by 57.1% between May-July 2023 and the same period in 2024. Taking out a loan is therefore not no more mission impossible.
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