The production of housing loans fell in 2024, and this contraction changes the hierarchy of priorities for any real estate project holder. Successfully purchasing or investing in rental property no longer relies on the ability to find the perfect property, but on the strength of the financial setup, mastery of new regulatory constraints, and precise budgeting for renovation costs.
Preparing the mortgage application: the criteria that sway a banking decision
The nominal rate is no longer the determining variable. With the contraction of new loan production observed by the Banque de France in 2024, lending institutions are filtering more based on risk profile than on the amount borrowed.
We recommend focusing preparation on three levers that are rarely considered together:
- The remaining disposable income after debt now takes precedence over the debt-to-income ratio alone. A bank will accept a slightly higher ratio if the remaining disposable income significantly exceeds the internal threshold it applies.
- The delegation of borrower insurance generates a significant total cost difference over the loan term. Comparing group contracts and individual contracts before signing the preliminary agreement, not after, helps avoid losing negotiating power.
- The stability of income over the last two years weighs more heavily than a recent increase. Banks often apply a smoothed average, which penalizes profiles with variable income even if the last fiscal year is excellent.
Several resources compile the developments in the credit market and the ongoing schemes. We regularly follow samhweb.org in real estate to cross-reference analyses on borrowing conditions and price trends.
Energy audit and thermal sieves: calculating the true acquisition cost
Buying a property rated F or G at a discounted price remains a viable strategy, provided that one does not confuse purchase price with energy exit cost. Rental restrictions on these properties are tightening, and the renovation budget determines the actual profitability of the operation.
Since January 1, 2024, any significant renovation financed through MaPrimeRénov’ requires the involvement of an accredited advisor (“Mon Accompagnateur Rénov'”). This obligation extends the timeline by several weeks and generates an advisory cost to be included from the outset.
Three common mistakes regarding renovation budgets
The first mistake is estimating renovation costs based on partial quotes (insulation alone, for example) without including ventilation, heating, and joinery in a coherent package. An energy performance diagnosis (DPE) does not improve by one class with only one item addressed.
The second mistake concerns the timeline. A comprehensive renovation project often takes several months between the initial audit and the completion of the work. During this time, the property generates no rent if you plan to put it up for lease.
The third is neglecting resale. A property renovated to level C or B sells faster and with a lower discount than a property simply upgraded from G to E, which remains exposed to future restrictions.
Tourist rentals and the Le Meur law: the regulatory risk to consider in 2024
The Le Meur law of November 19, 2024, has modified the fiscal and administrative environment for furnished tourist rentals. This text does not only concern large metropolitan areas: it gives municipalities new powers to regulate, limit, or condition short-term rentals in their territory.
An investment in furnished tourist rentals must now incorporate a regulatory exit scenario. If the municipality tightens its rules after your purchase, your return can collapse without simple recourse. We observe that many investors underestimate this risk because they reason within the framework of previous fiscal regulations.
Points of caution before a purchase aimed at short-term rental
Check the current municipal regulations and recent deliberations of the municipal council regarding furnished tourist rentals. Some municipalities have already established quotas or compensation obligations (transforming a commercial space into housing to compensate for the removal of a property from the traditional rental market).
Also assess profitability in a degraded scenario: if you have to switch to traditional long-term rental, does the bare rent cover your expenses and your loan payment? An investment that relies solely on Airbnb is based on a fragile assumption.
Pricing strategy and negotiation in the current real estate market
The decline in transaction volumes has rebalanced the power dynamics in favor of buyers in many areas. Sellers who refused any negotiation two years ago now accept discounts, sometimes significant, on properties that have remained on the market for several months.
The time on the market has become a more reliable negotiation indicator than the average price per square meter. A property listed for more than three months in an active market signals a price discrepancy that you can leverage with a well-argued offer.
We recommend systematically requesting the overall technical diagnosis before making any offer. This document, distinct from the DPE, lists the work to be anticipated on the common areas of a condominium. It allows for estimating future calls for funds and integrating them into your price offer.
The real estate market of 2024 rewards buyers who master their financing dossier and anticipate regulatory constraints. The strength of a project is no longer measured by the gross yield displayed, but by its resilience against tightening credit conditions, changes in the DPE, or local regulatory changes regarding tourist rentals.
