This is a major shift in the real estate sector that validates the downward trend in rates over the past few weeks. For the first time since 2021, the usury rate for loans over 20 years and more is down. As of Monday, July 1, banks will no longer be able to apply a rate higher than 6.16% for this category of loans, compared to 6.39% in the 2nd quarter. That is a decrease of 23 basis points. “We have to go back to April 2017 to find a drop of the same magnitude”indicates the Banque de France on its site.
The new usury rates were published in the Official Journal in a notice dated June 27, 2024. For loans with a term of between 10 years and less than 20 years, the maximum authorized rate remains unchanged at 6.13%. Finally, for loans with a term of less than 10 years, it increases slightly to 4.60% compared to 4.56% previously.
A wear rate that has soared since 2022
This reference rate caps all the costs of a property loan, recalls AFP: credit rate applied by the bank, possible broker commission, borrower insurance. It is calculated every quarter based on the rates applied by banks in the previous three months. These are increased by a third. On April 1, they had increased again.
Credits over 20 years and more represent “more than two thirds of the production of new credits” in France, specifies the organization. This reduction is therefore an encouraging sign for borrowers even if the level of the usury rate for this category remains very high. In the first quarter of 2022, it stood at just 2.4%…
