French mortgage rates in 2011

In August 2010 the TEC 10 index, which is used to price fix long term loans in France, reached its lowest ever level at 2.53%, and in October a report published in France revealed the average rate for mortgages in France was at its lowest level since the Second World War. The average rate in October 2010 stood at 3.30% which, when you consider the average French loan term is more than 15 years, shows just how attractive rates are. The Euribor 3 month, which is the index used to price billions of Euros of variable interest rate non-resident mortgages, has risen 30% in the last 6 months and now stands at 1.030%, just above the normal pre-crisis range and margin of the benchmark European Central bank rate of 1%. At the time of writing (December 2010) the Tec 10 has risen 20% to 3.12% since the...

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Prezi on French mortgage market trends for 2011

How we help and the historic opportunity on Prezi ...

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FRENCH FIXED RATE MORTGAGES HIT HISTORIC LOWS: ATHENAMORTGAGES.COM OFFERS 20-YEAR FIX FROM 3.45%

London, August 25, 2010 – As French fixed rate mortgages hit historic lows, French mortgage specialist Athenamortgages.com launches its lowest-ever fixed rate deals, with 15-year fixed rates from 3.30%, 20-year fixed rates from 3.45%, and 25-year fixed rates from 3.60% (all at 80% LTV).Athenamortgages.com has seen a sharp rise in the number of enquiries in August from UK buyers looking to take advantage of the cheap fixed rate deals on offer at the moment from French lenders, and September promises to be even better as fixed rates are predicted to fall even further.The reason for these record low fixed rates has been the downward pressure on...

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Euro mortgage currency watch from MoneyCorp

After six months in the wilderness the euro has come back with a bang. Since early June it has added 11 cents against the US dollar, a rebound of more than 9%. For the first half of the year investors fretted about the debt problems of Greece and the possibility that contagion could affect Spain and Portugal. They didn't like the euro so they liked the dollar. Now, they worry that the US economy is running out of steam, even that the president will feel the need for yet more expensive stimulus measures. They don't like the dollar so they like the euro. It is the lesser of two evils.The pre-and post-election rally did a good job for sterling, as did the new chancellor's brutal budget. Britain's AAA credit rating is no longer at risk and the pound is once again a currency that investors...

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Mortgages in France -Why buy French property now?

Obtaining French mortgage finance for a property in France can sometimes be a daunting process as the French banks generally demand more documentation to support an application than their UK counterparts. Add the cultural and language barriers and somehow just releasing equity in the UK starts to seem like a good idea. Whilst the pound/euro exchange rate has certainly improved over the last few weeks to €1.20 to the pound in anticipation of the UK getting its finances in order, it is still 20% down on where it was a couple of years ago and in effect by paying now in pounds the price is effectively 20% higher today. Not so if you take out a euro denominated French mortgage. By keeping the finance and the purchase in the same currency the monthly mortgage payments might be higher than they would...

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The effect of the UK budget on the French property and mortgage market

George Osborne’s budget today outlined some major changes to UK taxation but what effect if any will this have on the market for French property from UK buyers? The headline changes from the speech are the rises in VAT to 20% and the increase in capital gains tax to 28%. At first glance both of this rises appear to reduce the attractiveness of making investments as cash flow is effected by the rise in VAT and the long term profit of owning a second property in France is reduced by the increase in CGT.Listening to Harriet Harman’s appraisal of the budget as being unfair on those with the lowest incomes, as proportionally speaking the increase in VAT will hit there hardest, we can glean that it some way this budget is beneficial to those on higher incomes. In many ways this is right, the effect...

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Fixed rate mortgages in France vs UK.

Mortgage interest rates in France and across Europe are at an historic low currently which means that mortgage interest rates can only really go in one direction now. Whilst borrowers in the UK languish under the implied threat of interest rate rises owing to an UK inflation rate that is at the highest point since August 2008, the majority of their French counterparts can continue unconcerned thanks to their fixed rate mortgage in France which has a fixed rate for the term. Indeed, 70%-80% of current French mortgage holders have long term fixed rates of 15-25 years and with variable rates generally being capped and monthly payments on variable mortgages generally not allowed to increase by more than 10% per year, it is easy to see why the French are relaxed. By comparison, British borrowers...

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Interest rate and exchange rate outlook from Moneycorp

One of the first letters received by Britain's new chancellor came from Mervyn King, governor of the Bank of England and guardian of the nation's 2% inflation target. The governor must write an open letter of explanation and intent if inflation strays beyond a range of 1% - 3%. In April it was 3.7% so he put pen to paper. Two years ago or more the solution would have been simple; raise interest rates to dampen demand and bring inflation back into line. In the modern post-financial-crisis world with political uncertainty at home, fiscal anarchy across the Channel and low levels of economic growth in developed countries the decision looks less straightforward, especially as the Bank sees this inflation upturn as only a temporary blip.Although inflationary pressures in Euroland are less severe...

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Rates for French remortgages and French equity release mortgage rates

Remortgaging or releasing equity from your property in France can be an interesting as the process is quite unusual. There are a variety of reasons why refinancing an existing mortgage in France is not a common occurrence and subject to different rules and procedures from those in the UK. One reason is the existence of mortgage registration tax in France of approximately 1.5% when you bought your property. Every time the notary registers a charge against a property there are some transaction fees and taxes, which in the case of a French remortgage are called ‘frais de main levée’, literally cost to take the hand off, and then some fees to register the new mortgage amount for the new bank. Overall the fees for remortgaging your French property will be in the region of 2.5%, which depending...

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French mortgage rates 2010-2011: What next?

French mortgage rates have been relatively stable now for over a year. The only changes in the overall rates coming from changes in bank margins or if banks change their initial rate, also known as a teaser rate. So with all the turmoil in France over the huge deficit in Greece, what is the outlook for rates for mortgages in France?French mortgage rates are based on the rate set by the European central bank which currently stands at 1%. As the EU only has one interest rate for all 16 member states, it cannot adjust the rate to help those countries that are worse off. So when considering which way the rates for mortgages in France will go, we have to look at what is happening across the EU.The main factor affecting the ECB rate from which we get the current French mortgage rates, is the situation...

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French Mortgage calculator

Using a French mortgage calculator can give you a good understanding upfront of the likely cost of your mortgage in France. One question I have whenever am looking at calculators for mortgages in other countries is what is the likely rate going to be and what percentage of the property price am I going to be able to borrow. This is why on our French mortgage calculator page offers a handy idea of what the French mortgage best buys are for a range of purchase options from a classic second home mortgage to French leasebacks and Equity release options. With this information it is easier to get a top level understanding of what the likely loan payments will be on the mortgage and can help to inform you in your search for the right property and the right finance.However, French mortgage calculators,...

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French mortgage rates

When looking on the internet for the latest French mortgage rates, there are many sites offering this service. The temptation for most sites is to only give the lowest rates, perhaps for short durations such as fifteen years, which look attractive on the page, but leave some people disappointed when the realization hits that in fact the rate for the duration they are looking for is in fact much higher. In fairness to many of these sites the average cost per month for a €100,000 or €250,000 mortgage is also often displayed. However, many French banks still operate with an very low initial rate designed to attract customers, which distorts the figures for comparison and also the amount of the monthly payment. This initial rate or ‘taux initiale’ is usually fixed for 3 months, reverting afterwards...

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Life assurance for French mortgages set to change

The French mortgage market has received many plaudits recently as it is in relatively good shape compared to its ailing Anglo Saxon cousin. Once you look on the inside of the institutions and procedures of many of the banks you might be forgiven for thinking that you had been transported back to the mid 1980s. In recent times, competition has increased for mortgages in France for international buyers and in the past couple of years the first mass market interest only loans were introduced. Now further reform is on the cards as the French economic and finance minister, Christine Lagarde, continues her improvements to the regulatory landscape especially hidden bank charges.Many international buyers of French property are surprised to find that life assurance is compulsory for all French mortgages....

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French mortgage rates on the rise despite ECB hold

After meeting today with two of France’s leading mortgage providers, Athena Mortgages is now aware that the average margins for French tracker rates are about to increase slightly, whilst fixed rates in France are also about to rise. This increase of approximately 7% does have an impact on the bottom line for investment properties such as new build ski leasebacks as well as for classic second home properties. As we have some influence with our partner banks owing to the fact that so we have provided half of their total volume for the year, we have secured some preferential conditions and packages. These exclusive French mortgage deals will delay the rises for our clients for a period of 2 months and so we recommend you contact us very soon if you are considering a mortgage in France for an...

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The worst day of the year is behind us...

It is widely accepted that the last Monday in January is when most of us feel at an all time low for the year as memories of Christmas fade, the gloom gets to us (if we are in the northern hemisphere) and anxiety and depression can set in for all sorts of reasons not least the fact that New Years’ resolutions have already been broken. However, from our perspective, here at Athena Mortgages, all in fact seems to be brightening up and we are looking forward to another excellent year.The general feeling from many of our partners seems to be positive with many having closed many sales of French property over the festive period and continued the habit into the New Year. Across the board there seems to be a feeling of cautious optimism for the coming year with many plans now starting to bear fruit....

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Poll predicts no rise in ECB rates until Q4

The view that interest rates for mortgages in France will remain low for the next year at least, continues to be borne out as a recent poll by Reuters of 80 economists has predicted that there will be no increase in the European Central Bank interest rates until the fourth quarter of 2010. With this news, the outlook for rates for financing in France remains good with rates generally predicted to only rise to 2% in 2011. As we step out of the shadows of 2009 and into the uncertain light of 2010, there is a great opportunity for those with the confidence to search out and negotiate price reductions for the bargain property currently available in France. So if you have been planning to buy a property in France or you are looking for a good long term investment, The borrowing conditions have...

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