Consequence of refocusing the zero-rate loan in 2018: less 30% of beneficiaries!

After refocusing the free loan in 2018, unsurprisingly, Good Lenders Credit, 3rd National Credit brokerage network with over 200 branches, is a decline of one-third the number of beneficiaries and a reduction of 10% of the amounts granted with a stronger impact in the new than in the old. The government’s objective of lowering the cost of housing subsidies should therefore be achieved, to the detriment of first-time buyers, who are the first to suffer from the rise in prices. Estimates from SGFGAS (Management Company for Financing and Guaranteeing Social Home Ownership), cross-referenced with Good Lenders Credit statistics.

 

PTZ renewed in 2018 but revised downwards

loan rate

In 2018, the PTZ was renewed for 4 years but in the new one, it was refocused on the tense areas (areas A, A bis and B1) where the amounts of PTZ still reach 40% of the operation but lowered to 20% in zones B2 and C until 2019. From 2020, unless changed, relaxed zones should no longer be eligible for the PTZ.

In the old one, under work conditions, the system was refocused on zones B2 and C with the maintenance of a funding share of 40%. The so-called tense areas (A, A bis and B1) are no longer eligible.

The objective of this refocusing was, according to the government, to have a device “better targeted to build faster in tight areas and support revitalization in relaxed areas” but also to reduce the cost …

 

A 30% drop in the number of zero rate loans!

A 30% drop in the number of zero rate loans!

In 2018, according to estimates by SGFGAS, the Management Company for Financing and Guaranteeing Social Home Ownership, the number of PTZs granted in 2018 should stand at around 90,000, compared to 123,477 in 2017, ie a drop of 27% … In 2019 , the drop should continue, the government providing for the granting of 88,200 PTZ.

 

The drop reached 35% compared to 21% in the old

credit loans

Good Lenders Credit, a credit brokerage network, confirms this drop in the number of zero-rate loans obtained by its customers in 2018 with a more marked decline in new than in old. “In 2018, the number of credit files with a zero-interest loan decreased by 32% across all operations. In the new sector, the drop reached 35% compared to 21% in the old one. This shows that limiting the funding quota to 20% of the amount of the operation in relaxed areas has penalized first-time buyers more than its elimination in the former in tense areas … This is the construction sector in at least tense areas which suffered the most from this refocusing… ”analyzes Sandra Allonan, spokesperson for Good Lenders Credit.

Thus, the PTZ in the new (VEFA and construction) only represents 69% of the PTZ against 75% in 2017. Even more revealing, in the house / apartment distribution, the houses only represent 50% of the PTZ in 2018, against 61 % in 2017, further confirming the impact of the drop in PTZ in zones B2 and C…

On the side of the loan amounts granted, Good Lenders Credit notes that they are also down in 2018, by 10% on average, but with a decline there even more marked in the new (- $ 6,111) which is explained by the fact that the amounts granted do not exceed 20% of the amount of the operation in relaxed areas, where first-time buyers have the least difficulty in buying because of the price level and therefore where the demand for PTZ is strong …

In the former the amounts of PTZ logically also decreased, because the device no longer exists in tense areas, where prices were the highest.

 

First-time buyers and low-income households penalized

First-time buyers and low-income households penalized

“After the abolition of APL accession, the refocusing of the PTZ has also penalized first-time buyers and low-income households who see that once again, an effective system is threatened … We are waiting to know if it will be maintained beyond 2019 in the new in relaxed area.This is an issue for the future owners, but also and of course for the builders of individual houses impacted by the refocusing of the system ”concludes Sandra Allonan.

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