Mortgage rates to remain low in France, good time for borrowers
It’s that time of the year again, the rentrée. Each September marks a new work season, highlighted by predictions of the financial and real estate markets for the coming year.
The mortgage broker Credixia predicts that interest rates will remain low this September, but admits that the economic crisis in the Eurozone still makes forecasting changes in interest rates a challenge. This time of the year is traditionally favorable to the real estate market, especially as banks benefit from lower interest rates bringing in new customers.
Explaining why now is a very favorable time for borrowers, the brokers notes that the interest rates of the financial markets (OAT 10 Years), used as a reference for fixed rate mortgages, was fluctuating between 2.05% and 2.20% in August. In August 2011, the 10-year OAT averaged 3%, or a 1 point difference compared to today.
Additionally, that interest rates of the European Central Bank are down to a new record low of .5% in favor of the short-term refinancing of banks. Credixia predicts there is “no reason to expect a rate hike before the first quarter of 2013,” subject of course to external events in France and Europe not sullying this scenario.