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Role reversal. Currently, the State has a very high debt ratio compared to that of households in terms of mortgages. At the same time, in recent years, credit rates have skyrocketed. Furthermore, obtaining a loan rate below the 2% threshold is extremely rare, if not impossible, today.
Exceptional circumstances. The current situation is proving untenable for the banks. The latter have reworked their strategies for granting loans to households. Forced to revise rates upwards, the days when rates were estimated at 1% have passed. Yet this is last fall, a distant period on the borrowers’ timeline.
The sudden increase in mortgage rates increased tenfold over a very short period of time. At the pace of current fluctuations, the sinking of the wear rate is inevitably to be feared. On the other hand, the state’s position is no better. He borrows at an exceptionally high rate, much more than individuals.
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An atypical situation
According to Maël Bernier, our director of communications and spokesperson, no similar situation has been observed since 2006. At the time, the difference between mortgage rates and OATs was still acceptable, around 0.3% . Half of the credits were granted from variable rates. These days, that gap is incredibly close to 1%. Despite a marked improvement, variable rates hardly reach 5%.
The OAT flies away at an incredible rate. This could lead to a situation never before encountered. It would be possible for the State to borrow at a rate exceeding the authorized threshold. With 3.05% for the wear rate and 2.8% for the OAT, there is a risk of rejection of the request. These conditions are rather paradoxical, since the usury rate does not concern the State.
The analysis statistics show that the field of real estate credit encounters serious problems. Over 10 years, the State borrows from a 3% rate for housing purchases. For households, the rates are around 2.2%. Therefore, banks make more profit by lending to the state, to the detriment of households. According to Maël Bernier, many of them have even stopped granting mortgages because it is no longer beneficial.
What rate for your project?
The credit rate increases disproportionately
The 20-year credit rate has doubled in one year only. In terms of loans over 20 years, the average rate is around 2.2%. This is to be considered without costs and insurance. Over 25 years, the rate is around 2.35%. According to brokers, the rate will very soon reach 2.5%. It is very rare to obtain a rate of 2%. It is only granted to best records, in exceptional measures.
On October 1, the attrition rate peaked at 3.05%. However, this variable risks changing in the blink of an eye. Despite the planned wear rate update on January 1, 2023, a deadlock situation is to be feared. This will be felt over the next few weeks. Sylvain Lefèvre, President of the Central Financing Department, appoints the state as responsible for the current real estate crisis. In parallel, the blocking the rate of wear does not allow tenants to become owners.