French property prices rose by more than 10% overall over the last year, with property price rises in Paris almost double that figure. According to a large estate agency in France, apartment prices increased by 0.25% in March – the fifth consecutive monthly increase – while house prices rose for the 17th month in a row, up almost 1% in the same period. The same agency also notes that the average difference between the published price and the actual sale price is approximately 5%, based on figures from more than 12,000 sales in March.
We will watch with interest for indications of how the market reacts to interest rate rises, as each increase reduces the amount of money that individuals can borrow. Added to the increase in rates is a rising trend for extra underwriting scrutiny by many lenders. Whereas in the past a single underwriter could give a decision on a file, now many banks are employing extra credit committees to double check each file using more stringent sets of underwriting criteria.
The challenge for us at Athena Mortgages is to stay up to date with and adapt to the evolving criteria we face from each of the top 50 lending institutions we can work with across France. Fortunately we have longstanding relationships with these institutions, which means we have the communication procedures in place to maintain good customer service. We are happy to try to help those who have been refused and also those who are applying direct as we are confident we can beat almost any rate – especially if the borrower has a 30% deposit.