Access to real estate credit is increasingly difficult, especially for rental investment projects. In question: the rise in credit rates, which have tripled in 18 months, the increase in the level of contribution necessary to obtain a loan… As a result, the borrowing capacity of investors is falling.
Despite this tense context, it is still possible to invest in rental real estate in a city adapted to its new borrowing capacity, according to Masteos, which specializes in turnkey rental investment.
Increase in credit rates, the amount of the contribution…
According to the Crédit Logement/CSA Observatory, the production of real estate loans to individuals fell by 41.2% on 1is quarter of 2023 compared to the 1is quarter 2022.
The rise in credit rates (from 1.1% at the end of 2021 to 3.5% today, according to the broker Pretto) is responsible for an average loss of 24% in the borrowing capacity of investors. The increase in the average contribution requested by banks is also tightening the noose around investors.
The end of the differential calculus of the debt ratio
Another important element explains the loss of borrowing capacity of investors, according to Masteos: the end of the differential calculation of the debt ratio. Since September 2021, banks can no longer use this method of calculation for real estate loans intended for rental investment.
It made it possible to reduce the debt ratio: part of the rents collected expected from the leased property automatically offset the borrower’s expenses related to the rental investment, explains Pretto. Banks must now rely on the calculation of the traditional debt ratio (borrower’s expenses divided by his income x 100).
Consequence: an additional drop in borrowing capacity of 10% for investors. This amounts to a total loss of 34% by adding the 24% linked to the increase in credit rates.
An even more glaring drop for the purchase of a thermal colander
The decline in the borrowing capacity of rental investors is even more severe in the event of the purchase of a thermal sieve, these properties classified F or G under the thermal performance diagnosis (DPE), “even though they present interesting investment opportunities”, points out Masteos, with lower selling prices.
Indeed, future rents are less taken into account in the calculation of the investor’s debt ratio by some banks: 50% of rents for rental properties classified F and 0% for those classified G, against 70% of rents taken into account for other properties.
Which solution ?
Faced with this drop in borrowing capacity, one solution is to invest in other cities that correspond to your budget. For example, for a rental investment in a 30 m² studio, for a borrowing capacity reduced from €300,000 to €200,000 (-34%), you have to turn to Lyon, Nice or Bordeaux (around €5,000 per m²) rather than to Courbevoie, Malakoff or Clichy. For a borrowing capacity increased from €200,000 to €130,000, you have to abandon Lyon, Nice or Bordeaux for Lille, Toulouse or Montpellier (€3,500 per m² on average).
According to Masteos, it is currently the regional mutual banks that best finance rental investments.
Where to invest with a budget of €50,000?
According to Masteos, which specializes in turnkey rental investment, it is possible to invest in certain cities with a budget of €50,000.
In the top 5, we find Le Havre (€2,067 per m²; 6.8% rental yield, with a rental tension of 7/10), Perpignan (€2,016 per m²; 6.5% yield, with a rental voltage of 10/10), Dunkirk (€1,857 per m²; 7.1% yield, with a rental voltage of 10/10), Montauban (€1,948 per m²; 6.5% yield, with a rental voltage of 10/10) and Niort (€1,825 per m²; 6.8% yield, with a rental voltage of 10/10).
This ranking takes into account a population of more than 40,000 inhabitants, prices per m² of less than €2,000, a rental yield of more than 6%, rental tension greater than or equal to 7/10 and a median income per inhabitant greater than 20 000 €.
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