Real estate property is a desire of three quarters of French people. Young people are no exception. Yet young households (<35 years old) represent only 58% of first-time buyers in 2018 . Getting a CDI is essential to take out your first mortgage. However, the share of permanent contracts represents only 13% of hirings.
Why buy your first real estate from an early age?
CDI in hand, young people go in search of their first mortgage, and professionals confirm that it is a good idea. A real estate purchase made early avoids the payment of rents lost funds . This is one of the main goals of three-quarters of first-time buyers.
A property acquired at a very young age can then be valued by the sale, as long as the principal residences are exempt, at least for the moment, from taxation on capital gains. This allows young households to adapt their housing to their family and professional needs and to satisfy their desire for property without breaking their budget.
Also read: ” Real estate in France, 3 out of 4 people prefer the purchase to rent “.
Beneficial rates for young people
The other advantage of borrowing at a very young age is that banks offer them very attractive conditions. Interest rates on mortgages are already very low, but banks rely on these attractive offers to retain new customers . They can offer them other benefits that will largely offset the effort made on rates.
In fact, young borrowers can expect rates lower than the current average of 1.44% , in the range of 1.15 to 1.35%. In addition, banks are less demanding on the resource conditions of young people, who can, unless accident, only move up. Exceptional offers, such as Crédit Agricole’s zero-interest loan , enable them to make a contribution that their new employment situation has not allowed.
Reduced requirements in terms of personal contribution
Banks are not content to offer very low rates and be less resource intensive. At each age his credit : they understood that the under 30 years do not necessarily, at the time of their first purchase, managed to constitute a sufficient contribution (generally 10% of the amount of the real estate). They take into account the whole situation, including the lack of personal input. While it does facilitate the approval of mortgage loans in many institutions, it remains that real estate loans without contributions are commonly granted.
On the other hand, the duration of the credit granted varies according to the banks. Some are ready to lend home loans for 30 years or more when others prefer to limit themselves to 25 years . A long term will be granted with a higher rate, significantly increasing the overall cost of credit.