Mortgage loan: rates continue to fall!
The average mortgage rate fell further in April 2019 according to the last publication of the Housing Loan Observatory: 1.35%, or 0.4 points less than the previous month. At the same time, the loan term fell for the second consecutive month.
Down for 3 months
For the third consecutive month, the average mortgage rate fell in April to 1.35%, the same level as in October 2016. This average decreased by 0.23 points in less than two years, and by 0 , 9 points since the start of the current year. The Housing Loan Observatory specifies that it is the eleventh consecutive month when these rates are lower than the rate of inflation. In detail, the rate of a home loan for a purchase in the new is 1.38%, against 1.35% in the old .
Average duration stagnates or even regresses
We had reached and even exceeded 19 years old last February, here we are again below this threshold for the average duration of repayment of a mortgage: 226.8 months to be precise in April 2019. When it is possible, it is always more interesting to aim for a short duration: we obtain on average 1.09% over 15 years, against 1.49% over 25 years (and 1.27% over 20 years). The strongest files can even hope for 0.82% over 15 years, which reduces the cost of a mortgage from $ 150,000 to less than $ 9,500!
A growing activity
Low real estate rates are good, but with prices that are increasing from month to month in big cities, the share of long-term loans is getting longer: 72.6% exceed 20 years and almost half even (42.4%) spans 25 years and more! However, low mortgage rates are opening up access to property for more households, which translates into increased activity. To know where we are in this context when we have a real estate project, it is possible to carry out a simulation of borrowing capacity: with an estimate of this purchase envelope in our pockets, we can then more easily visit properties in line with its budget.
The increase in the amount of production accelerated by 24.5% over the last quarter compared to the same period in 2018, that of the number of loans granted jumped by almost 17% at the same time. And the good news is that the relative cost of a property purchase (4.4 years of income) has declined slightly in one year, although this figure remains high.