In the current climate of high interest rates, should you abandon your real estate purchase? The answer is "no". Here are some good reasons why you should take the plunge now, rather than wait.
1. Banks are more open
Even though lending rates have risen sharply over the past two years, borrowing conditions are improving. After turning off the credit tap, banks are once again showing a willingness to lend in order to win over new customers. Loan refusals are becoming rarer, but above all, borrowers can negotiate much more favorable terms than in 2023.
2. The sales offer has expanded
After a gloomy 2023 in terms of transactions, the stock of properties for sale has consequently swelled. This puts buyers in a strong position: they can take the time to visit, compare and therefore better negotiate the purchase price. This situation can be observed just about everywhere, except in the most densely populated areas, where a reasonable cooling-off period is still required to avoid missing out on an opportunity.
3. Property prices are falling
After a period of strong growth, property prices are beginning to stabilize or even fall. This is due to the economic context observed over the last two years: the rise in interest rates has excluded many buyers from the market, or forced some to revise their budgets downwards.
4. Building wealth
Real estate is a sure-fire way to build up your assets, providing a degree of financial security by taking advantage of the leverage effect of a loan, without having to dip into your savings. What's more, the repayment of a loan is made up partly of interest and partly of capital, i.e. a sum that will be recovered at the time of resale, unlike rent, which is paid out in full...
5. Renegotiate your mortgage rate
The rise in interest rates, from 1% at the end of 2021 to just under 4% today, has dampened the spirits of many buyers, reducing their borrowing capacity. But don't lose sight of the fact that loan rates can be renegotiated, especially as they are expected to stabilize in 2024. Rates could even fall again by early 2025. By buying now, you'll not only be able to negotiate the price of your property, but also renegotiate your loan rate in a few months' time. So there's no doubt that now is the best time to buy.
Translated with DeepL.com (free version)
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