Mortgage Credit: Punishing Low Income Families -

Mortgage Credit: Punishing Low Income Families –

According to the latest CSA Credit Housing Monitor for the second quarter of 2022, the downturn in the real estate market has been confirmed. Since December 2021, loan rates have continued to rise, regardless of duration. If all classes of borrowers are involved, then less affluent families have more difficulty borrowing.

Is it still possible to get a mortgage for a modest family? Nothing is less certain if we are to believe the Crédit Logement CSA quarterly analysis published on Tuesday.

According to INSEE, one-year inflation is estimated at 5.8% in June, which reduced the purchasing power of home real estate. If we add to this the inflationary context, the tightening of grant conditions and the war factor in Ukraine, the real estate market is gradually narrowing.

To realize their real estate project, borrowers find themselves forced to find solutions: Borrow longerraise a greater personal contribution or Looking for a property with a small space.

What is the rate for your project?

The profile of borrowers is changing

Michel Mollart, the economist in charge of the observatory notes this Borrowers Profile Changes. They have a larger personal contribution than before (+28.8% since the end of 2019) and are borrowing more due to higher property prices.

to respect Maximum Debt Ratio 35%Families are forced to borrow for longer periods. In the second quarter of 2022, the average term of loans granted was 239 months. The study notes that among those under 35, 78.5% took out a loan of more than 20 years in the second quarter, compared to 69.7% last year. Conversely, loans of 15 years and less are still declining and account for only 13.6% of total production, the lowest percentage ever observed.

In the current context, “the number of loans granted has decreased since the beginning of 2022,” according to the observatory. If rich families could always borrow, This is no longer the case for everyoneespecially for low-income people, who find themselves almost excluded from a mortgage.

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