Credit is essential to finance the purchase of housing

According to a recent study, nearly 9 in 10 tenants with a real estate purchase project say they need a home loan. The bank loan has thus become a powerful engine for financing the purchase of housing.

Real estate credit: a must-have source for most homeowners

Real estate credit: a must-have source for most homeowners

Despite financial and banking crises, home equity is one of the main sources of money for a good majority of homeowners and households wishing to become homeowners. For example, a new study shows that 86% of tenants who want to access home say they need housing finance.

The figures show that among the French already homeowners, 42% still have a current housing credit. Thus, repayment of monthly payments represents approximately 36% of owners’ income. A slightly higher proportion than banks recommends (33% of net income). According to this survey, 48% of surveyed homeowners find it difficult to repay their outstanding loans. 44% report being unable to afford the best possible housing.

In addition, almost 60% feel that it is increasingly difficult to become homeowners and consider that they will have to work harder than their parents to access the property. This proportion is even greater when it comes to Millennials.

Real estate purchase: personal contribution remains important and necessary

Real estate purchase: personal contribution remains important and necessary

Among households that used credit to access homeownership, the personal contribution accounted for more than 10% of the total amount of the acquisition. However, in the details, the contribution varies between 10 and 30% for a third of owners surveyed, 30 to 50% for 13% of them and more than 50% for about 10% of them. More than half of the tenants with a real estate acquisition project intend to make a personal contribution of more than 10% of the project amount.

That 54% of the properties have drawn from their savings to make a personal contribution, 22% sold an existing property, 11% benefited from an inheritance, 8% obtained credit from their parents and 7% used the amounts allocated to leisure activities or vacations.

Despite the personal contribution, nearly 12% of the owners received a donation or help from their families. This proportion is nearly 25% for owners born between 1981 and 1996.