The fall in the amount of real estate loans granted has increased in recent months but their amount could start rising again next year, according to figures published on Tuesday, July 11 by the Observatory Credit Housing / CSA. In the second quarter, the “production” of these loans collapsed by 40.8% compared to the same period of 2022. With 150 billion euros in loans expected for the whole of 2023, it would return at the level of 2015, commented during a conference Michel Mouillart, professor of economics and responsible for the presentation of the results of the study.
While the Banque de France often presents the market slowdown as a “normalization” after a good year cycle, Michel Mouillart brushed aside this interpretation, referring to “a collapse” and not “not a consolidation” or “a landing”. The central bank and the Observatory have been at odds for several years over the figures and the methodology. For 2022, the Observatory had thus mentioned a drop of around 20% while the Banque de France spoke of a decline of 3%.
Although the central bank reports all the credit data and is therefore more precise, the Observatory considers that its results suffer from a lag of several months with the reality of the situation.
A glimmer of optimism
According to the broker Meilleurtaux, the demand for loans fell by 20% over one year in the first half, in particular due to the rise in interest rates. The average rate for new mortgages fell from 1.20% in January 2021 to 3.08% in May, according to data from the Banque de France. The slight declines in real estate prices “have not at all compensated for the decline in borrowing capacity”, underlined for his part Maël Bernier, director of communication at Meilleurtaux. The number of files that cannot be financed, due to a debt ratio much higher than that required by the authorities, thus rose from 22% in January 2021 to 33% in June 2023, according to Meilleurtaux.
A glimmer of optimism though: “it is likely that in the fall we will have reached the bottom of the pool” and “a slow restart of credit production” can be expected for the summer of 2024, Michel noted. Mouillart. According to Maël Bernier, if interest rates are expected at 4% in the fall, it is likely that they will stabilize for some time on this “level” allowing the sector to catch some air, especially if the banks are beginning to return to the mortgage market, which they had neglected in recent months.