With the increase in interest rates, it takes longer and longer to make the purchase of your principal residence profitable. Drawing. (Pixabay / Mastersenaiper)
In 2023, it takes more than 15 years for buying your main residence to be more profitable than renting it. This is ten years more than two years ago according to the study by the broker Meilleurtaux. Some big cities are still doing well.
Buy or rent? Many French people ask themselves the question. Every year, Meilleurtaux publishes a study to help them make a choice. In 2023, for buying to be preferable to renting, you must remain the owner of your main residence for 15 years and six months, according to the report relayed by
The Parisian
. In 2022, it took two years less and in 2021, 10 years less.
Meilleurstaux based its study on housing with an average surface area of 70 m² in the 32 largest cities in France. For the purchase, the organization took into account the price per m², the property tax, the charges, and the borrowing rates, specifies the daily. For the rental, he retained the amount of the rents and the return on the money invested which would have constituted the personal contribution in the event of purchase.
High rates and prices that fall little
Buying your home has become less and less “profitable” in recent months.
“The explanation is that mortgage rates are rising while real estate is not really falling. And there is also the increase in property tax…”
indicates to the daily Maël Bernier, spokesperson for Meilleurtaux.
The most favorable year was in 2019. Buying then cost the same price as renting. At that time, borrowing rates were already low and real estate prices did not have to climb. Under these conditions, remaining a tenant was disadvantageous after barely a year and nine months, specifies
The Parisian
.
More than half of the major cities impacted
The time needed to make a purchase profitable has thus exploded in 17 of the 32 largest French cities. In Perpignan (Pyrénées-Orientales), you must occupy your property for at least 10 years (compared to two years in 2022). In Aix-en-Provence (Bouches-du-Rhône), it is necessary to stay 21 years and 6 months against 8 years in 2022. In Reims (Marne), the switch is made at 19 years against 3 and a half years in 2022.
But other cities remain attractive for investing in real estate. This is the case of Marseille (Bouches-du-Rhône), Lyon (Rhône), Rouen (Seine-Maritime) or Orléans (Loiret). In Marseille, it takes 13 years to make a purchase profitable, compared to 20 years in 2022. In Lyon, in 2023, we go from 28 to 22 years old.
Is it preferable in this context to postpone your real estate purchase at all costs? Not necessarily.
“At some point, if you’re a homeowner, you’ll be done paying off your loan,
explains Maël Bernier.
A tenant, in twenty-five years, will still have to pay his rent each month and will be at the mercy of the landlord’s decision.
. And when rates drop, new homeowners can always renegotiate their loan.