The idea is not new but it is re-emerging. Seine-Maritime MP Damien Adam (Renaissance) made a request in early May Law proposal which aims to enable borrowers to use the portability of home loans to save money. A measure defended for years by the National Real Estate Federation (Fnaim), which obviously welcomed this bill. “This is a positive sign in the resolution of the real estate financing crisis”, reacted Loïc Cantin, president of Fnaim. For ChallengesDamien Adam illustrates the general lines of the text which should be discussed in the Chamber next September.
Damien Adamo- To ensure that everyone who has taken out a property loan to purchase a property can benefit from the same interest rate if they wish to sell their main home to purchase a new one. Over the course of two years, average mortgage rates have increased from 1% to 4%. The idea is to enable people who have negotiated previously very low rates in order to continue to benefit from them. This is the so-called credit portability, a clause that can be included in loan offer contracts.
The advantage is twofold: today many citizens would like to change accommodation for various reasons (birth of a child, departure of a child for studies, etc.) but they do not do so because real estate loans are too expensive. This situation blocks the real estate market. My invoice can partially solve this problem.
I haven’t had the opportunity yet, but I intend to meet key players in the banking sector in the coming weeks. But in fact we can expect some reluctance because this measure would generate potential capital losses for them in the future. However, they must realize that the real estate market is completely saturated and that this limits the number of loans to be granted. Therefore, if they left this portability in the contracts, citizens could be induced to make additional loans to those they already have. Because if they buy a slightly more expensive property, they have to integrate the additional cost of the new accommodation with a new additional credit. It’s a win-win for everyone. If the real estate market recovers, banks could get less future revenue, but even more loans, so it is in their interest.
In fact, this proposal is not new and I had also discussed it with the former Minister of Construction, Patrice Vergriete. The latter underlined that this solution was not favored by the government. Today, the current minister, Guillaume Kasbarian, seems more open on the issue. A few weeks ago he seemed to say that the idea was interesting and that it needed to be studied even if the text will certainly be integrated with amendments by September. I remain optimistic for the future because this measure would allow results to be achieved in the short term and would not cost anything for the public finances.