Real estate lending: An open letter from brokers to Housing Minister Olivier Klein

We publish below the content of an open letter sent by Lenders to the Minister for Urban and Housing, Olivier Klein, Minister for Environmental Transition and Territorial Integration, on Wednesday 4 January.

As an approved association representing loan intermediaries, brokers and agents, we have always communicated to our clients and members all areas of improvement that have been accepted or may be received by government authorities and ministries in housing. And in this sense, keeping the PTZ, the Pinel device and all the measures to promote the energy renewal of buildings are only positive elements that we welcome.
But we will not be able to support this public policy without a financial solution for borrowers. Because you still need to be able to buy before repairing. And that’s the rub.

Preventing access to credit is more necessary than ever

Our clients, the French, have been suffering for several months from the devastating effects of the depreciation rate calculation method, which has neither increased lending rates, nor the debt ceiling set by the HCSF, much less inflation, and the resulting decline in purchasing power. The result is an increasing rate of exclusion from access to credit
of borrowers and to capture the entire real estate chain, from construction to rental, through promotion and operation. A drop in new home sales of 29.3% over the past three months is just one indicator.

Recall that the brokers who answered our survey in July already reported an alarming rate of rejection of applications by banks in the first half of the year: an average of 25%.

This percentage was understood before any presentation in the bank. And if the declines in the rate of attrition affect all profiles without distinction, the 30-55-year-olds suffer the most; Nevertheless, the age group that brings together those who are most likely to face loan repayment.

In addition, banks’ reluctance worsens an already tense context

Credit supply therefore failed to recover as often seen in the fall. Loan production continued to decline: production measured at the quarterly level in November decreased by 36.4% year-on-year, and the number of loans decreased from 37.3%.
%. Crédit Logement/CSA Observatory observes a 27% drop in loans in the 3rd quarter of 2022. These figures are only observations of banks. When households approach us for their projects, we allow you to imagine the rate of reduction in the main intention.
With borrowers unable to meet increasingly restrictive income and debt amount criteria…
Finally, from January 1, 2022, we observe the despondent French who refuse to apply for a loan.
Unfortunately, the improvement we expected did not happen, on the contrary.

A real dialogue with all real estate players is essential

Here, Minister, are some of the reasons why we want a positive signal from the government to eliminate access to credit. It is about the daily life of the French, their most important needs for security, and at the same time, the survival of the real estate ecosystem.

At the beginning of the new year, we ask for extensive consultations with broker associations, real estate federations, notary chambers, consumer societies and all those involved in the housing problem.

The success of the energy renewal policy will also depend on the financing of the real economy.

Hoping that you will share our ambition for a housing policy that serves the interests of the French people, we invite you to take all the measures that will facilitate access to credit.

Some of us have already made proposals: the separation of TAEA from TAEG, the evolution of Action Logement intervention ceilings, the exclusive use of the depreciating option for the calculation of the wear rate, the revision of the HCSF criteria for the calculation of rental income. debt ratio, increasing the maximum loan period, especially for young families, etc.

As we begin the period of good wishes, Mr. Minister, let us work together to achieve acceptance or hearing from the Government on this issue, which has remained one of the most important priorities and concerns of households in all these recent years.

Please be assured that we will respectfully remain at your disposal for any constructive exchange on these matters, Mr. Minister.

Signatories of the open letter: Jérôme CUSANO, President of AFIB – Française des Intermédiaires en Bancassurance; David CHARLET, President of ANACOFI Courtage – National Association of Financial Advisors; Bruno ROULEAU, President of APIC – Professional Association of Credit Intermediaries; Christelle MOLIN-MABILLE, CNCEF Credit – National Financial Expert Advisory Chamber – Credit and Yves MAZIN, Vice President IOB CNCGP – Wealth Management Advisory National Chamber and Etienne KAJOIN, La Compagnie IOBSP La Compagnie des Oédis and President Payment Services.