The retail credit market is still in the green. According to the latest figures published by the Banco te France, its growth rate is + 4.5% in December for an outstanding of 1 096 billion euros. A result that takes into account both real estate loans and consumer loans. The monthly production is surfing on the same wave.

An accelerating growth rate for housing loans

An accelerating growth rate for housing loans

Ok, the activity of the credit to individuals is increasing, but what about home loans? According to the BoF, activity is accelerating, posting an annual growth rate of 4.3% in December 2016 (compared to + 3.8% and + 3.9% respectively in October and November). Outstanding? It reaches 899 billion euros.

The production of new loans is also accelerating

The production of new loans is also accelerating

On the side of new credits, we are not left out. The bullish movement continues in December with 33.6 billion euros, against:

  • EUR 21.3 billion in July 2016;

  • 23.7 in August 2016;

  • 24.3 in September;

  • 24.8 in October;

  • 28.4 in November.

Real estate rates down

Real estate rates down

Paradoxical. While we note that real estate rates are back in recent weeks, the Banco te France announces that the average rate of new loans to housing (all durations) retreats to 1.50%.

The reason is very simple: the month of December marks the beginning of the rebound in bank rates. Clearly, the next edition of the BdF (for credit production in January) should indicate a return to higher bank rates.

Meanwhile, we see that the average fixed rate steadily declined in the second half of 2016:

  • 1.78% in July 2016;

  • 1.72% in August;

  • 1.68% in September;

  • 1.60% in October;

  • 1.56% in November;

  • 1.50% in December.

Of course, with interest rates as attractive, the purchase of real estate credit is the lion’s share. This operation boosts new home loans, up to 54.9% of this activity. The BdF notes however that the share is smaller than the previous month (58.9% in November). In detail, the share of credit renegotiation is:

  • 43.9% in July;

  • 49.9% in August;

  • 51.6% in September;

  • 54% in October;

  • 58.9% in November;

  • 54.9% in December.

For the record, the repurchase of real estate credit (or renegotiation of loan) makes it possible to buy back its habitat loan signed a few years ago. The borrower then subscribes to a new mortgage at current rates, more advantageous.

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