Mortgage Rates in France Stall at 3% Amid Economic Uncertainty

Mortgage rates in France have unexpectedly paused their decline, causing concern among borrowers and investors. This stagnation comes despite a more lenient monetary context and a recovering real estate market. The rates, which had dropped from above 4.5% at the end of 2023 to around 3% in spring 2025, have now frozen for three months. This unexpected halt raises questions about the dynamics of financing in France and reveals deeper tensions in the real estate sector, which is trying to emerge from a period of lethargy.

While loan activity is surging in France, interest rates on loans have remained stable for the past three months. This stability is in contrast to the downward trend that began at the end of 2023, when rates for loans of 20 years or more peaked above 4.5%. The real estate market has shown signs of recovery, with transaction volumes in older properties rising by 8% in the first half of 2025. However, despite these positive indicators, the rates have not continued their downward trajectory. The current stagnation is attributed to a combination of economic and behavioral factors, including banks' preference to preserve margins amid economic uncertainty.

Data from banking barometers indicate that the downward movement of rates has stopped, leaving a plateau. Rates for 20-year loans have stabilized around 3%, after a sharp drop from their peak at the end of 2023. Real estate prices have remained generally stable, limiting leverage effects for borrowers. Banks, despite a more dynamic market, have not adjusted their rate scales for several months, favoring a controlled profitability approach. Borrowing conditions have eased considerably, but this has not triggered further rate decreases since spring. While borrowers benefit from more favorable conditions than in 2023, the rate decline seems to have reached a technical floor, at least in the short term.

The current stability in rates is not a temporary phenomenon but a result of a deeper shift in banking policies. Major brokers have noticed a stabilization of rate scales since spring 2024, which continues into 2025. Banks remain commercially aggressive but are more focused on strategic files. This results in occasional but limited offers, such as reduced rates for first-time buyers or subsidized loans for energy-efficient homes. Outside these privileged profiles, standard rates no longer change. This new balance appears durable, with the Governor of the Bank of France indicating that exceptionally low rates around 1.5% seen four years ago are unlikely to return.

In this environment of credit stagnation and instability in borrowing conditions, some investors are turning to alternatives uncorrelated to classical bank rates. Bitcoin, in particular, is gaining visibility as a safe haven asset and diversification tool. Its decentralization, independence from monetary policies, and direct accessibility attract a growing segment of savers frustrated by the slowness of traditional financing. This renewed interest highlights a shift in wealth strategies, at a time when traditional credit levers struggle to reactivate. The prospect of a return to floor rates is fading, and for borrowers, this means that current conditions, ranging between 3% and 3.5%, could become the norm. While this stabilization may reassure in the short term, it also demands a revision of long-term strategies for both individuals and investors.