Extremely low rates, granting conditions much lighter, attractive offers to banks, France in recent times, all the elements necessary to promote the purchase on credit. And despite unusually rising real estate prices, the French seem more and more interested in buying real estates on credit. Currently, household debt represents 58.4% of GDP, compared to 31% in 2000.
Everyone is benefiting
Real estate transactions come alive with blatant momentum since January 2018, with credit offers highly profitable for borrowers. Banks, forced to fill the void, engage in a fierce competition where the merit is only for those who dare to propose record rates. And now, we find offers of credit rates lower than 1%, or even 0% over 30 years, granted to seniors.
Although a rise in rates was predicted by some specialists, credit rates continued to fall in the first half, reaching a record high of 1.42% in May, according to figures revealed by the housing credit observatory. At the end of June, rates even fall below inflation (2.1%). A situation that mainly benefits wealthy investors, the same has been revalued at 1.24% in 2017 for ordinary employees.
Specialists point out that banks have a clear preference for first-time homebuyers with savings or attractive profiles – with a substantial income of 45,000 euros per year. Crédit Agricole Ile-de-France even allows all first-time buyers to obtain a credit of 30,000 euros, at zero rates, regardless of their age. Many banks also offer a discount of 0.10 points to young borrowers under the age of 35.
More and more flexible conditions
Competition requires banks to be more flexible in response to customer demand. In addition, most of them are forced to lower their guard to catch up on their business objectives. And it’s not just the rate, renegotiation that are breaking the record today, alongside falling rates. Even the rates posted with banks offer direct discounts of 10 points. This allows even the most modest of borrowers to get a mortgage at a very profitable rate. The opportunity for those who think invest in real estate in Mauritius to embark.
In Mauritius, the real estate sector remains stable, with prices still open to foreign investors, including the French. In addition, the Mauritian government still offers preferential support for any foreign investment, through its Property Development Scheme (PDS). For an investment worth over $ 500,000, the foreign investor can both get the house of his dreams, but also a residence permit in Mauritius. An opportunity to seize also for those who think of a rental investment since Mauritius submits any PDS real estate purchase only a tax on capital gains of 15%. Not to mention that having a second home in a seaside resort is always a profitable investment in the long term.