Today’s announcement that the European Central Bank (ECB) has cut its benchmark rate down to 0.15% from 0.25% could push France’s lowest ever mortgage rates down even further, report French property and mortgage specialists. To the delight of investors, Mario Draghi has also now paved the way for Quantitative Easing (QE) in the Eurozone which could be the catalyst for house price growth across the country, especially in prime areas as the supply of money increases, similar to the booming market in London over the last 18 months.
“Draghi has been suggesting a rate cut for a while now so this move finally demonstrates how serious the ECB is about boosting the Eurozone economy,” says John Busby at French Private Finance. “French interest rates already hit record lows this week, largely from competition in the domestic market and weak economic data, and now they’re likely to go down even further.”
“If you combine this with the fact that quantitative easing (QE), or as Draghi puts it ‘asset-backed securities’ purchases, is likely to be the next step for stimulus, then we suddenly have a very heady mix for investors. QE is a bold move for any economy and in the UK and US this has already had a significant impact on property markets. If France can achieve similar growth, the economy is likely to follow suit.”
“France has always been a popular place for international investors,” continues Busby. “With this new combination of super-low rates, soft property prices and tangible prospects for price growth, investors are going to rally towards France to snap up the best priced property.”