Aid to which thousands of French people are entitled has recently been extended.
Buying your home: a sweet dream cherished by 61% of French people and, more particularly, young people. 80% of 18-34 year olds aim to own their main residence. But these hopes have hardly turned into reality in recent years. Since the end of the health crisis, bank rates have increased significantly and conditions for granting credit have tightened. Mechanically, the number of transactions decreased due to lack of buyers.
Although prices have fallen by 4% on average at the national level (with greater falls in certain regions, notably in Paris and nearby suburbs), this has not necessarily revived the dynamic. The fault lies in the difficulties in financing projects. Banks do not want to take risks and refuse any financing that results in a debt ratio of 35% or more.
To reduce the amount borrowed, future buyers are increasingly turning to their loved ones. Parents, grandparents or any other family member can agree to an interest-free loan, which must be formalized in writing and, obviously, repaid. But another solution also exists to finance your real estate projects, without asking those around you… and without paying interest either.
The system has a well-known name: the Zero Interest Loan (PTZ). If until now it was reserved for low-income households, the “middle class” can now use it. Since 1er April, new rules came into force and made thousands of additional French people eligible. The calculation of the PTZ is complex since it takes into account several parameters: the level of income, the address of the accommodation, the number of people housed and the cost of the property. Its amount is therefore individualized.
To better understand who is eligible for this system, here are the maximum salary levels not to be exceeded by zone (know your zone by clicking here):
- Zone A: €4,000 per month per household
- Zone B1: €2,875 per month and per household
- Zone B2: €2,625 per month and per household
- Zone C: €2,375 per month and per household
The amount then loaned without interest varies with regard to the other criteria. On average, according to the latest statistics, between 50 and 55,000 euros are paid when an operation is finalized. With rates currently around 4%, this allows buyers to save around €35,000 in interest paid to the bank.
It should be noted, however, that the system can only be subscribed to for the purchase of a new apartment in zones A and B1 and only for an old property in zones B2 and C (each time in the context of a main residence only).