What will be the rates in February 2024?

On January 25, 2024, the European Central Bank (ECB) kept its key rates on hold. This is a major decision, which directly affects the real estate market. We explain why.

Rates that will go down a little more?

According to a press release from Cabinet Galliwell & Associates citing the words of Carolyn Arnold (General Director of CAFPI): Real estate loan rates will continue to decline in the coming weeks.

As we told you in the previous article, the borrowing rates are coming down in early 2024. Currently, it is possible to borrow at rates as low as 3.70% over 20 years.

We are already talking about the passage under 3.50% During 2024 or early 2025, returns below 3% in late 2024. This is an interesting window for buyers.

” With a well-prepared file, it is again possible to borrow for 20 years at rates as low as 3.70%. We anticipate that the decline in home loan rates will continue very slowly throughout the year and hence it is likely that loan rates will fall below 3.50% during the year and reach around 3% by end 2024/early 2025. » we can read in the press release.

This reduction in rates directly affects the market.

More affordable credit cost

For example, a mortgage of 200,000 euros over 20 years at an interest rate of 3.70% would have a total cost of 283,338.95 euros. This includes a monthly payment of approximately 1,180.58 euros.

For a mortgage of 200,000 euros over 20 years at an interest rate of 3.00%, the total cost would be 266,206.85 euros. The monthly payment will be around 1,109.20 euros.

A boon for some, a worry for others, especially as we now see property prices falling. A reduction of up to 8% in some major cities.

Interesting investments again?

This favorable situation restored purchasing power to the French. After a particularly difficult year in 2023, access to property may once again become a tangible reality.

With lower rates, credit becomes more accessible. Banks are showing renewed interest in lending to real estate projects.

Projects that have been stalled may finally materialize.

The year 2024 could once again be an interesting year for investing in real estate. This is a strong signal sent to potential buyers.

Development to watch closely

However, this trend is not set in stone. The overall economic situation remains uncertain. Buyers should be vigilant and informed.

The maintenance of key rates by the ECB opens up interesting prospects for the real estate market. This is a strategic period for investors and prospective owners. Current conditions may redefine the real estate landscape in the coming years.