Lower French mortgages on offer

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The economic reforms brought in by government in France continue to have far-reaching effects on the domestic property market.

With investors having been wary of the changes, interest in French property has been patchy as the country continues to take a slightly different approach to the ongoing crisis than some of its neighbours.

Now it seems French banks are becoming increasingly competitive when it comes to mortgage lending and this is presenting overseas buyers with new opportunities.

Although the main European Central Bank has kept its own interest rates stable at 0.75% for eight months now, French banks have in fact decreased both their rates and margins.

Currently non residents can take advantage of the historically low rates too. A fixed rate of 3.35% is available over a 20 year term, and a 20 year tracker mortgage can be found at only 2%.

The rates are a quarter point lower than those on offer at the end of the Second World War, and a mortgage of €100,000 will only cost €572 per month for the fixed rate deal over 20 years.

In real terms the figures look even more attractive. If you take out the inflation element currently standing at 1%, the current variable rates are effectively 1% and fixed rates at 2.35%.

Anyone who has been considering buying a property in France, such as one of the many new contemporary style Ski resort developments, the current conditions offer a very favourable time to dip in. It isn’t just low interest rates that are a good deal, as asking prices are still very reasonable too.

The reasons behind the moves are mainly to do with increased competition between the French banks, which have essentially lowered their margins by approximately 10%. The cost of borrowing long term money has also got cheaper, with chief indicator TEC 10 dropping by more than 0.50% in the last month and currently standing at 1.73.

Transferring money to France or any other country in the Eurozone means dealing with the international exchange markets. The best rates are most often found with specialist currency dealers, so be sure to compare the market before you send money worldwide.

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Lower French mortgages on offer

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