lReal estate professionals have regained confidence with the drop in interest rates seen since the beginning of the year. Even if they will not soon return to the historically low levels they reached in the early 2020s, the drop in rates helps restore some purchasing power for those looking to purchase a home.
However, the observed easing does not erase the brutal increase since 2022. And the decline in prices, observed in certain areas, does not compensate for the increase in the cost of money since the – abnormal – period when it was possible to borrow more than twenty years. years in… 0.5%. As a result, the real estate market came to a standstill. The number of transactions is expected to contract by more than a third in 2024, compared to the record in 2021.
Sellers do not want to give up the prices they could expect two years ago, especially when they have taken out a mortgage at significantly lower rates than those available today. Buyers, for their part, hope that the generally modest price decline will continue, allowing them to finance their dream property under current conditions.
Modest discounts
According to the professionals (estate agents, credit brokers, notaries, etc.), this period is coming to an end. With the fall in rates expected to continue in the coming months, buyers have returned to real estate agencies and sellers are willing to grant discounts, often modest, to sell their property, especially when they are forced to do so. The slight increase in prices observed here and there would attest to the end of the crisis that the sector has experienced in recent quarters.
Will this movement continue in the coming months? “We don’t see any immediate signs of recovery in the housing market”says Boris Intini, CEO of PraxiFinance, a firm that monetizes real estate through different solutions. Other experts are more optimistic. On the interest rate side, the easing will continue. However, the announcement on September 12 of the easing of the European Central Bank’s monetary policy by Christine Lagarde, president of the monetary institution, did not give a precise indication of the pace of the cuts to be expected until the end of the year, and we will probably have to wait until December to see a new move. On the price side, demand is there, but supply is a little lower, which suggests the end of the fall. However, other parameters must be taken into account.
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