France: Will the rate of rates be introduced to the real estate market before the new era? AiOFM.Net

The European Financial Landscape has just experienced the main milestone with the Decision of the European Central Bank (ECB) to reduce its key rates of 0.25 percentage points. A measure that does not pass unnoticed in the context where access to a mortgage loan remains a capital number for households and investors. This decline could encourage demand and order on market dynamics, but observers remain divided according to their actual range.

Monetary relief with current repercussions

6. March 2025, European Central Bank He announced a new decline in his three leading rates to support the slowdown in inflation and the growth of support. Indeed, Christine Lagard, the president of the institution, emphasizes that this decision aims to “perform new loans cheaper and households” and “soften the monetary policy that has become too restrictive in the face of the current market dynamics.”

Specifically, it should be noted that:

• The main function of refinancing operation was reduced to 2.65%;
• Simplicity of deposits drops at 2.50%;
• Marginal loan ease by 2.90%.

Such a decision has a direct impact on real estate loans, which are closely linked to the ECB monetary policy. Bank institutions can now borrow at reduced cost, they start to adjust their bids. Simulations show that the borrower benefits from a 3% rate, not 3.8% for a loan of 350,000 euros could save more than 33,000 euros in full loan lasting. However, this adjustment is not translated into a uniform decline in the prices that practices banks, as the latter also includes other criteria such as the risk of damage and economic market.

According to a sustainable reviving market or temporary stabilization?

If the decline in leading feet is good news for borrowers, it does not guarantee automatic recovery in the real estate market. Several major financial institutions, such as Goldman Sachs, Nomura and Barclays, believes that ECB could continue this trajectory with two additional drop in 2025. years, which would further emphasize the availability of the loan. On their side, some observers plan Property rate stabilization About 2.6-2.8% By the end of the year, a favorable perspective for those who considering the purchase of real estate medium / term.

However, caution factors remain. The macroeconomic environment remains marked by geopolitical insecurities, increased commercial barriers and slowdown in several countries in the eurozone. In addition, although the rates are more attractive, banks remain demanding profiles, which promotes the strongest dossiers. This situation could thus be maintained by market segmentation, where only candidates who have a good compensation capacity benefit from the most favorable conditions.

Although this fall is the price of the opportunity for real estate investors, it does not resolve Structural market tensions. Demand should be gradually returned, but without softening the criteria for giving and permanent stabilization of the economy, the effect of hopes could be limited.

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